Procter & Gamble's net income falls 2 pct
CINCINNATI (AP) — Procter & Gamble Co.'s net income fell 2 percent in the fiscal first quarter as revenue growth was offset by the consumer-goods giant's higher costs.
P&G, maker of Tide detergent and Pampers diapers, said net income fell to $3.02 billion from $3.08 billion. Per-share earnings were $1.03 per share, in line with analysts' estimates.
The decline came despite a revenue increase of 9 percent to $21.9 billion. That beat analysts' estimates for revenue of $21.5 billion. P&G said it expects revenue to increase 3 to 6 percent for the current fiscal year, which runs through June, due in part to higher prices.
P&G serves as a bellwether for the consumer-products industry and the economy as a whole because its products ranging from Gillette razors to Olay skin cream can be found in homes across America. Like many companies, it's been raising prices and trimming some of its own expenses to battle higher costs for raw materials. But it has to be careful not to raise prices too high and risk driving away customers who already are saddled down by stubbornly high unemployment, stock market turmoil and an overall weak economy.
The Cincinnati-based company has raised prices on some products, including Pampers diapers, Charmin toilet paper and Cascade dish detergent. P&G took a different tack during the depths of the recession, going after customers who were trading down to store brands by offering cheaper "Basic" versions of some products.
P&G also has been expanding in emerging market countries in Africa, the Middle East and elsewhere, as a way to make up for recession-weary U.S. customers reining in spending. Like most companies, P&G usually sells lower-priced items with lower profit margins in those regions, although they hope to move consumers into buying higher-priced products.