P&G share price falls as revenue just misses expectations in earnings report

Procter & Gamble (NYSE:PG) share price falls despite earnings report showing earnings per share (EPS) being above, and revenue being similar to, expectations of analysts.

The consumer goods corporation announced a 1% increase in revenue, compared to last year, to $16.653 billion. This just misses forecasts by analysts polled by Thomson Reuters, which was $16.698 billion. EPS was $1.09, above forecasts by 1c, a 6% increase. P&G say this was “primarily due to a reduction in outstanding shares.”

The company also returned $4.3 billion to shareholders, $1.8 billion of which was paid through dividend payments, the rest through common stock repurchase. P&G also had a $3.6 billion operating cash flow for the quarter.

David Taylor, chairman, president and CEO of P&G, said that “First quarter sales and earnings results were in line with our going-in expectations and keep us on track to deliver our targets for the fiscal year”. Of the future, Taylor said “we will drive innovation, productivity and organization transformation to accelerate top-line growth while further expanding our industry-leading profit margins.”

The results posted for their individual sectors were mixed, with beauty, health care and fabric and home care increasing sales, whereas grooming and baby, feminine and family care experienced a reduction in revenue.

P&G have estimated that the sales growth for the coming year should be 3-4% and they have maintained their 2-3% forecast for organic growth in the same period. The company have also noted that they maintain their expectations for EPS of 5-7% for the fiscal year despite “over $100 million of incremental commodity cost headwinds resulting from the hurricanes that impacted the Gulf Coast in September.”

P&G’s share price has fallen by over 3% in early trading to $88.61 at the time of writing. These results come as Nelson Peltz continues to contend a proxy vote that meant he did not manage to successfully join the board.