P&G CFO: US consumer spending 'is tremendously strong'
Another quarter in which Procter & Gamble Co. (PG) cleaned up nicely is in the books, thanks in large part to the spending habits of the U.S. consumer.
The consumer products giant, which has jettisoned underperforming businesses, cut costs and reinvested in releasing more premium products under CEO David Taylor, delivered fiscal fourth quarter sales about $300 million ahead of analyst estimates on Tuesday. Earnings excluding one-time items clocked in at $1.10 a share, handily surpassing forecasts for $1.05 a share.
Shares popped more than 4% in pre-market trading.
P&G’s outlook also signaled another solid year of growth in its current fiscal year. The company outlined sales growth of 3% to 4% in the coming fiscal year. Earnings excluding one-time items are seen rising 4% to 9%.
“The U.S. consumer is tremendously strong,” P&G chief financial officer Jon Moeller tells Yahoo Finance. Moeller explained he is seeing very little evidence of a U.S. recession. Moreover, global economic conditions continue to be supportive of P&G’s businesses Moeller said — he pointed to sales in China surging 12% in the most recent quarter.
And the proof of all of that is in the pudding.
P&G grew organic sales in all of its business lines in the quarter, paced by 10% gains in health care and fabric and home care. Product volume increased in all segments except grooming, which fell 1%, as P&G continues to feel pressure from competitive pricing by upstart razor blade companies.
Brian Sozzi is an editor-at-large and co-host of The First Trade at Yahoo Finance. Follow him on Twitter @BrianSozzi
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