Procter & Gamble Co.(NYSE: PG) has issued an earnings update to reflect what it called significant currency exchange rate movements. The consumer products giant is adjusting its total sales and earnings growth estimates, but is still confirming organic sales growth and its currency-neutral earnings growth expectations.

We would caution that this is a headwind, and the market cap of $213.7 billion makes this the most watched consumer products company in the world. P&G is also a Dow Jones Industrial Average component.

Organic sales growth in 2014 is being put at 3% to 4% for its fiscal year 2014. Foreign exchange is expected to lower its sales growth by 2% to 3%. The consumer products giant lowered its core earnings per share growth range down to 3% to 5% from a prior range of 5% to 7%. Foreign exchange is now projected to be a nine percentage point core earnings per share growth headwind for fiscal year 2014.

The update follows recent policy announcements by the Venezuelan government — that impact foreign exchange rates applied to various transactions as well as significant exchange rate movements in Argentina and other developing countries.

P&G is lowering its guidance for all-in sales and all-in earnings growth to reflect the increased impact from foreign exchange. Venezuela announced that certain transactions, such as the importation of finished goods and raw materials for some product categories and the payment of inter-company dividends and royalties, would be transacted at the state-run SICAD currency rate.

P&G said:

P&G said it expects to incur one-time charges in the range of $230 million to $280 million after-tax, or $0.08 to $0.10 per share, based on its preliminary assessment of the impact of revaluing certain portions of the local Venezuelan balance sheet at the new exchange rate of 11.4 bolivares fuertes per U.S. dollar. The final impact will be dependent on confirmation of final balance sheet positions at the date of the policy change. The Company said it will recognize the one-time charges as non-core items in its fiscal year 2014 results.

P&G also projected that other financial impacts will reduce fiscal year 2014 core earnings growth by approximately one percentage point.

Shares of the consumer products giant closed up 1% at $78.84 against a 52-week range of $73.61 to $85.82, but the stock was indicated down 0.4% at $78.51 after the news. If P&G is having these woes, it is likely that other consumer products companies will as well.

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