Procter & Gamble Co., the world’s largest consumer-goods maker, posted second-quarter profit that topped analysts’ estimates as sales of products such as Pampers diapers rose in emerging markets.
Net income fell 16 percent to $3.43 billion, or $1.18 a share, from $4.06 billion, or $1.39, a year earlier, Cincinnati-based P&G said Friday in a statement. Excluding some items, profit was $1.21 a share.
Chief Executive Officer A.G. Lafley has said developing markets with climbing household incomes will be “significant” drivers of growth. Sales in such countries rose 8 percent in the quarter, excluding the effects of acquisitions, divestitures and foreign-currency exchange-rate fluctuations. Those gains have helped P&G overcome weakness in the U.S., where it is trying to recapture market share in key categories such as detergents.
“Some of those investments are paying off for them in emerging markets,” Jack Russo, an analyst at Edward Jones & Co. in St. Louis, said. He recommends buying the shares.
Sales rose 0.5 percent to about $22.3 billion. Analysts estimated $22.3 billion, on average. Growth in developing regions helped boost sales in the fabric and home care business as well as the baby, feminine and family care unit, P&G said.
P&G reiterated its annual forecast for a 5 percent to 7 percent increase in adjusted earnings and a 3 percent to 4 percent organic sales gain.
P&G rose 4.1 percent to $81.43 at 10:21 a.m. in New York on Friday, and earlier climbed as much as 4.4 percent for the biggest intraday gain since May 24. The shares advanced 20 percent last year, compared with a 30 percent increase for the Standard & Poor’s 500 Index.
Currency fluctuations reduced earnings in the quarter by 11 cents a share, P&G said today. Currencies also reduced net sales by 3 percentage points, while the mix of products sold reduced sales 1 percent.
