NEW YORK – Procter & Gamble Co. (PG) said on Thursday quarterly profit jumped 13 percent on solid sales growth, beating estimates, and the consumer products maker raised its fiscal year forecast.
Profit at the maker of Crest toothpaste and Pampers diapers rose to $1.72 billion, or 63 cents per share, in the fiscal third quarter ended March 31, up from $1.53 billion, or 55 cents a share, a year earlier.
Wall Street, on average, had expected 61 cents a share, according to Reuters Estimates. P&G had forecast 60 cents to 62 cents.
"P&G has done a great job weathering the storm of higher input prices and a secular slowdown in Western Europe," said CSFB analyst Lauren Lieberman, who rates the stock "neutral."
P&G and other consumer products makers have been trimming expenses and raising prices to mitigate the effects of rising commodity and raw material costs.
Shares of Cincinnati, Ohio-based P&G, a component of the Dow Jones industrial average, were at $53.99, up 46 cents from a Wednesday close at $53.53 on the New York Stock Exchange (search).
Quarterly net sales grew 10 percent to $14.29 billion, ahead of analysts' average forecast of $13.9 billion. The company had expected growth in the high single digits.
Higher prices on items such as coffee added 1 percent to sales growth, P&G said. The weak dollar added 3 percent, boosting the value of sales in other currencies.
Unit volume grew 6 percent, led by growth in health care and developing markets. Volume grew 7 percent excluding the impact of acquisitions and divestitures.
P&G said earnings for the fourth quarter, which ends in June, should be 54 cents to 55 cents per share. For the fiscal year, it now expects $2.64 to $2.65 per share, up from a previous forecast of $2.61 to $2.64.
Analysts, on average, expect a profit of 55 cents a share for the fourth quarter and $2.63 for the year.
In January, P&G agreed to buy Gillette Co. (G), a deal valued at over $55 billion that would create one of the world's largest makers of household goods. P&G said on Thursday its integration planning with Gillette was continuing.
"We think top- and bottom-line momentum will only accelerate once Gillette is incorporated into the business, and cost and revenue synergies begin to accrue," said Deutsche Bank's Bill Schmitz, who rates P&G shares "buy."