Revenue Drops at Proctor & Gamble on Strong Dollar

On Tuesday, Proctor & Gamble warned that efforts to trim down and speed its growth in sales by cutting down on brands has been overshadowed by the unprecedented devaluations in currency.

Almost every currency worldwide devalued against the U.S. dollar, with the Ruble in Russian being the leader, said CEO A.G. Lafley in a prepared news release.

While the company continues to make good progress on its transformation, product innovation, productivity progress and business portfolio was not sufficient to overcome the foreign exchange losses.

P&G announced it expects the volatility of currency to reduce sales for its year that ends in June by up to 5% and its profit by as much as 12%.

The warning arrived as P&G reported its December quarter that did not meet expectations, as its sales fell throughout all divisions as the impact of foreign exchange weighed heavily.

The comments regarding currency impacts have echoed those recently by United Technologies, Pfizer and DuPont, all of which released outlooks that were disappointing.

Shares at P&G were down by 2.4% during trading before the bell on Tuesday. The company has planned to shed as many as 100 brands as it is focusing resources on between 70 and 80 brands that are the highest growth.

In November, it agreed to sell Duracell battery a billion dollar business to Berkshire Hathaway, Warren Buffett’s company.

P&G said at that time it was close to selling 10 other small brands, with potential buyers holding information packs. Last month, P&G entered into an agreement to sell its Zest and Camay soap brands to rival Unilever.

Overall, P&G showed a profit of $2.36 billion equal to 82 cents per share, which was down from last year during the same period of $3.42 billion equal to $1.17 per share.

Excluding certain items earnings per share reached $1.06. Revenue was down by 4.4% to end the quarter at $20.16.

Analysts were expecting earnings per share to be $1.13 on $20.62 billion of revenue.

Excluding the impact from rated of foreign exchange sales at P&G were up 2%.