P&G hopeful about organic sales growth

CINCINNATI Procter & Gamble expects to return to organic sales growth in the second quarter, following two quarters of organic sales declines, the company confirmed during an institutional investor conference in Boston on Thursday.

"We clearly see that we are approaching an inflection point in P&G's organic sales trends. The innovations we are launching and the investments we are making are having an impact in the market," stated Jon Moeller, CFO. "In addition, comparisons to prior year results will get easier as we move into the second quarter."

For the October-December quarter, P&G expects organic sales growth of 1% to 4%. P&G expects to give more details for second quarter sales and earnings per share when it releases first quarter results on Oct. 29.

For the July-September quarter, P&G confirmed expectations for organic sales growth of flat to -3%. Foreign exchange is expected to reduce net sale by about 7% resulting in a drop in net sales of -7% to -10% versus the prior year. It continues to expect all-in earnings per share of 95 cents to $1 for the quarter.

For fiscal year 2010, P&G confirmed previous guidance of organic sales growth of 1% to 3%. It expects net sales to between flat and 3%, versus prior-year levels, which includes foreign exchange impact of flat to -1%.

It now expects fiscal 2010 earnings per share in the range of $3.99 to $4.12 per share. This includes a one-time net increase in earnings of 44 cents per share from the sale of the pharmaceutical business, which will be partially offset by 10 cents to 12 cents per share related to the transaction.

"We acted with urgency to protect the structural economics of our business last year, and we are acting with urgency this year to deliver profitable market share growth," stated president and CEO Bob McDonald.