P&G Q3: organic sales up 5 percent but margin drop spooks market

P&G Q3: organic sales up 5 percent but margin drop spooks market

Procter & Gamble has reported its results for the third quarter of fiscal 2019. The US FMCG giant saw sales rise 1 percent to US$16.5 billion (+5 percent in organic terms). Earnings were also up, growing 9 percent versus the prior year to US$1.04 per share.

“We delivered another quarter of strong organic sales growth, enabling us to further increase our outlook for the year,” said David Taylor, Chairman, President and Chief Executive Officer. “Cash generation also remains strong, supporting an increase in our cash productivity target and extending our long track record of dividend increases. Our focus on superiority, productivity and improving P&G’s organization and culture is delivering improved results despite a challenging competitive and macroeconomic environment.”

The Beauty category delivered a net sales increase of 4 percent, with skin and personal care – particularly the premium SK-II brand – named as a highlight, although grooming disappointed with net sales down 8 percent.

However, a drop in operating margin – down 10 basis points versus the base period on a reported basis – was a red flag for some and sent shares down 3.3 percent, per Reuters.