A year into its restructuring, Procter & Gamble has yet to improve its sales performance after shedding thousands of jobs.
On July 29, the company reported an annual profit of $16 billion on sales of $87 billion. Organic sales growth, a key metric, increased 1% in the previous fiscal year, down from 2% last year when slowing sales prompted the current restructuring.
P&G’s sales results for the fiscal year and April-June quarter fell short of Wall Street analysts’ forecasts, while profits beat predictions. In the fourth quarter, the company booked a $3 billion profit on sales of $21.2 billion.
In a conference call with Wall Street analysts, CEO Shailesh Jejurikar characterized the past 12 months as “foundation building” amid “a very challenging geopolitical and economic environment.” He said results would improve in the toward the end of the new fiscal year.
“We’re pleased with the progress we’re making (but) it won’t be a straight line,” he told analysts. “We are building momentum with consumers, and we are excited about the long-term opportunities ahead.”
Looking ahead, P&G said it expects organic sales to grow 1% to 3% in the 2027 fiscal year. Organic sales growth excludes impact from foreign exchange, acquisitions and divestitures.
In a separate announcement on July 29, P&G said Jejurikar’s predecessor, Jon Moeller, the board chairman would retire on July 31 and leave the company on Aug. 14. Jejurikar will become board chairman on Aug. 1.
The Cincinnati-based maker of Tide laundry detergent and Pampers diapers first announced plans to slim down at an industry conference in summer 2025, by cutting 7,000 office jobs worldwide.
In June, a year later at the same event, executives revealed it was “on track” to cut more than 3,500 by the end of the first year of the cutbacks. On the July 29 conference call, chief financial officer Andre Schulten confirmed the progress: “Half of the headcount reduction has been executed.”
Wall Street analysts expected P&G to post a $16.6 billion profit before one-time items on sales of $87.1 billion for the fiscal year ended June 30, according to Zacks Investment Research of Chicago. Analysts also forecasted the company will post a $3.4 billion profit before one-time items in the fourth quarter on sales of $21.4 billion.
P&G is a major local employer
P&G’s hometown could be more deeply affected by the cuts that are targeting nonmanufacturing jobs. Most of the roughly 10,000 P&G workers in Greater Cincinnati are office workers.
Last year, P&G earned a $16 billion profit on total sales of $84.2 billion.
Based in downtown Cincinnati, P&G employs 109,000 workers worldwide. Besides Tide and Pampers, other products the company makes include Gillette razors, Pantene shampoo, Olay moisturizer, Mr. Clean household cleaners and Vicks cough medicine.
This article originally appeared on Cincinnati Enquirer: P&G sales stay sluggish as restructuring continues, chairman to retire
Reporting by Alexander Coolidge, Cincinnati Enquirer / Cincinnati Enquirer
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By Alexander Coolidge, Cincinnati Enquirer | USA TODAY Network
