Why Procter & Gamble Q2 Earnings Were Not Enough

Companies and Brands

Published: January 23, 2018 9:50 am

Last Updated: January 12, 2020 4:13 am

Procter & Gamble Co. (NYSE: PG) released its most recent quarterly results before the markets opened on Tuesday. The company posted $1.19 in earnings per share (EPS) and $17.4 billion in revenue, compared with consensus estimates from Thomson Reuters that called for $1.14 in EPS on revenue of $17.39 billion. The same period of last year reportedly had EPS of $1.08 and $16.86 billion in revenue.

During the quarter, the company tallied a provisional net charge of $628 million related to the Tax Cut and Jobs Act, comprised of an estimated repatriation tax charge of $3.8 billion (comprised of the U.S. repatriation taxes and foreign withholding taxes) and a net deferred tax benefit of roughly $3.2 billion.

P&G reported its quarterly results for its business segments as follows:

Beauty segment organic sales increased 9% to $3.23 billion.
Grooming segment organic sales decreased 3% to $1.78 billion.
Health Care segment increased organic sales 4% to $2.21 billion.
Fabric and Home Care segment organic sales increased 3% to $5.43 billion.
Baby, Feminine and Family Care segment organic sales decreased 1% to $4.61 billion.

Looking ahead to the fiscal 2018 full year, the company expects to see core EPS up 5% to 8%, compared to in 2017. P&G also expects all-in sales growth of about 3% in the same time. The consensus estimates call for $4.18 in EPS and $67.05 billion in revenue for the 2018 fiscal year.

David Taylor, board chair, president and chief executive, kept it short and sweet:

We accelerated organic sales growth and delivered strong productivity cost savings and cash flow. We remain on track to achieve our fiscal year objectives.

Shares of Procter & Gamble traded down about 3% at $89.18 early Tuesday, with a consensus analyst price target of $93.84 and a 52-week range of $85.42 to $94.67.

Get Ready To Retire ^(Sponsored)

Start by taking a quick retirement quiz from SmartAsset that will match you with up to 3 financial advisors that serve your area and beyond in 5 minutes, or less.

Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests.

Here’s how it works:
1. Answer SmartAsset advisor match quiz
2. Review your pre-screened matches at your leisure. Check out the advisors’ profiles.
3. Speak with advisors at no cost to you. Have an introductory call on the phone or introduction in person and choose whom to work with in the future