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Increased spending pushes Procter & Gamble off target
PROCTER & Gamble (P&G), the world’s largest consumer goods firm, saw profits drop 12 per cent in the final quarter of its fiscal year as the company’s generous marketing spend outstripped rising sales volumes. P&G, which owns household brands such as Pampers nappies and Crest toothpaste, said earnings fell 11.3 per cent to $2.19bn (£1.37bn) over the quarter.
The fall came in spite of an eight per cent hike in P&G’s sales volumes, the company’s most impressive gain for 22 quarters. Total net sales for the year rose three per cent to $78.9bn.
P&G said it had ramped up advertising spend by 13 per cent to over 10 per cent of total sales, 2while it also increased its outlay on marketing and product development.