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Gillette to be drag on P&G profits next two yearsPosted by Retirement on: 2005-10-04 07:10:29 in category:
Stocks & Securities [ Print | Permalink / 0 Comment(s) ] Posted on Mon, Oct. 03, 2005 Associated Press CINCINNATI - Integrating the Gillette Co. into the Procter & Gamble Co. fold will reduce P&G's profits by 20 to 26 cents per share in the current fiscal year ending June 30, 2006, and by 12 to 18 cents the following year, P&G said Monday. However, the effects of the $57 billion acquisition that closed Saturday should then be neutral, putting P&G back on track with its pre-Gillette earnings growth target for fiscal 2008, the company said. "I am confident that the merger of P&G and Gillette will succeed," said A.G. Lafley, P&G chairman, president, and chief executive. "We are both industry leaders on our own, and we will be even stronger and even better together. We are ready to get on with the integration." Procter & Gamble is the world's largest maker of household products, including Tide detergent, Bounty paper towels, Crest toothpaste and Folgers coffee. The acquisition of Gillette adds the Mach 3 and Fusion razors and Duracell batteries to its line of products. Analysts surveyed by Thomson Financial, on average, project earnings of $2.81 for fiscal 2006 and $3.18 for 2007. The company said about half of this fiscal year dilution will affect the October-to-December quarter, driven by one-time charges from closing the deal and a lower level of cost savings in the first three months compared with later quarters. Analysts on average expect revenue growth of 6 percent for 2006 and 5 percent for 2007, according to Thomson Financial. In fiscal 2005, the company earned $7.26 billion, or $2.66 a share, on sales of $56.74 billion. P&G also reported Monday that it had repurchased 156 million shares, or about $8.5 billion, as part of the previously announced share repurchase program associated with the Gillette acquisition. The program anticipates that the company will repurchase $18 billion to $22 billion of P&G stock over a 12 to 18 month period that began on Jan. 28. P&G shares fell 15 cents to $59.31 in trading Monday on the New York Stock Exchange, down from its 52-week high of $59.46 reached Friday. Its shares have traded as low as $50.53 in the past year. Homepage Other open community sites http://www.business-business.biz Please support our sponsors: To design your custom retirement plan. http://www.retirement-plan.us For planning IRA rollovers. http://www.ira-rollover.us Professional asset allocation and the wonders it can do. http://www.asset-allocation.us Professional money management- Nationally ranked performance. http://www.roth-ira.us Managers selected to fit your needs. http://www.money-managers.us |
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