P&G CFO: US consumer spending 'is tremendously strong'

Brian Sozzi · Executive Editor

Updated Tue, Jul 30, 2019, 5:56 AM

The consumer products giant, which has jettisoned underperforming businesses, cut costs and reinvested in releasing more premium products under CEO David Taylor, delivered fiscal fourth quarter sales about $300 million ahead of analyst estimates on Tuesday. Earnings excluding one-time items clocked in at $1.10 a share, handily surpassing forecasts for $1.05 a share.

Shares popped more than 4% in pre-market trading.

P&G’s outlook also signaled another solid year of growth in its current fiscal year. The company outlined sales growth of 3% to 4% in the coming fiscal year. Earnings excluding one-time items are seen rising 4% to 9%.

“The U.S. consumer is tremendously strong,” P&G chief financial officer Jon Moeller tells Yahoo Finance. Moeller explained he is seeing very little evidence of a U.S. recession. Moreover, global economic conditions continue to be supportive of P&G’s businesses Moeller said — he pointed to sales in China surging 12% in the most recent quarter.

And the proof of all of that is in the pudding.

P&G grew organic sales in all of its business lines in the quarter, paced by 10% gains in health care and fabric and home care. Product volume increased in all segments except grooming, which fell 1%, as P&G continues to feel pressure from competitive pricing by upstart razor blade companies.

Brian Sozzi is an editor-at-large and co-host of The First Trade at Yahoo Finance. Follow him on Twitter @BrianSozzi