P&G Posts Drop in Q3 2009 Sales

The Procter & Gamble Company announced its 2009 third quarter (January-March 2009) net sales were down 8% from the year-ago quarter, at $18.4 billion. Organic sales were up 1%, reflecting a 6% net benefit from pricing and mix, which offset lower volume.

"We delivered good third quarter results in a very challenging macroeconomic environment," said A.G. Lafley, chairman of the board and CEO, P&G. "We grew organic sales and EPS, maintained global value share and generated strong cash flow. Our near term efforts are focused on enhancing consumer value, driving productivity and simplification, and making the necessary investments for the future. We continue to invest at leadership levels in innovation, brand building, capacity and capabilities and are confident in our long term growth prospects."

The company's beauty net sales declined 9% during the quarter to $4.3 billion. Organic sales were in line with the previous year period. Volume declined 5% due, in part, to market softness in prestige fragrances, where the volume declined in double digits. Retail hair care volume was down low single digits, while volume in professional hair care decreased double digits primarily due to market softness. Skin care volume declined high single digits, mainly due to trade inventory reductions and the divestiture of Noxzema.

For the 2009 fiscal year, the company expects organic sales to grow by 2&ndash3%. Net sales are expected to be down 2–4%, due primarily by unfavorable foreign exchange of about 5%. Operating margin is expected to be consistent with the prior fiscal year. The company also stated that it is comfortable with analysts' current consensus earnings per share estimate of $4.22 with a range of $4.20 to $4.25.

The full report is available on the company's site.

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