P&G to prioritise investments in core business and geographies
Revises down April-June quarter guidance and releases preliminary 2013 guidance
To achieve its objectives of more balanced growth across geographies, product categories and the top and bottom lines, Procter & Gamble has announced that it intends to prioritise investments in its core business, biggest, most profitable markets, biggest innovations and biggest emerging markets. However the company also clarified that it intends to maintain strong investment levels in recently entered markets.
Speaking at the Deutsche Bank Global Consumer Conference in Paris, P&G chairman Bob McDonald said the company also hoped to drive productivity improvements and cost savings by improving the consistency of execution in all facets of its operations in the hope of delivering $10bn in cost savings by the end of fiscal 2016.
P&G also announced adjustments to its April-June quarter guidance; organic sales growth is now expected to be in the range of 2-3%, compared to previous guidance of 4-5%, net sales are now expected to decrease by 1% while core earnings per share are likely to be in the range of $0.75 to $0.79. These revisions are primarily driven by slower than anticipated top line growth from slower than expected market growth rates and market share softness in developed regions and negative impacts from foreign exchange rates, said P&G.
Meanwhile, preliminary guidance for fiscal 2013 suggests organic sales could increase in the range of 2-4%, while core earnings per share are expected to be in line to up mid-single digits percentage versus fiscal 2012.
P&G will provide an update to its fiscal year 2013 financial outlook when it releases final results for fiscal year 2012 on 3 August.