* Sees '10 EPS $3.65-$3.80; Street expected $3.92
* Says to invest in new products, international mkts
* Shares down 0.2 percent
(Adds company comments)
By Martinne Geller
NEW YORK, May 28 Procter & Gamble (PG.N)
forecast fiscal 2010 earnings way below Wall Street estimates,
as it invests in international markets and new products, but
its shares fell only slightly as analysts said the investments
were needed for future growth.
The maker of Gillette razors and Tide laundry detergent,
which has seen some of its brands lose market share as
recession-hit consumers trade down to cheaper or private-label
brands, said on Thursday that it plans to accelerate its
spending on new plants and new products.
P&G said it is expanding its presence in faster-growing
emerging markets like India, where it launched its Pampers
brand of diapers. Within the next five years, the company said
it expects to sell its products in 8 million stores in emerging
markets, up from about 4 million now.
It is also launching new products at home and abroad under
its core brands, such as a new Tide Stain Release laundry
additive, the company said at an investor conference.
Due to these initiatives, P&G said it expects earnings of
$3.65 to $3.80 per share for fiscal 2010, which starts in July,
and net sales ranging from down 2 percent to up 1 percent.
Analysts on average expected fiscal 2010 earnings of $3.92
per share, according to Reuters Estimates.
BMO Capital Markets analyst Connie Maneaty recommended
buying P&G shares on any weakness resulting from the outlook as
she sees the company's fundamentals improving over the next
"We expected P&G to offer an outlook that pointed to heavy
investment to recoup share losses, especially in detergents,
and accelerate the investment in faster-growth international
markets," Maneaty wrote in a note to clients. "We believe
today's news represents a solid buy-point."
When asked about whether it planned to lower any prices
this year, P&G executives said there would be "surgical"
adjustments, primarily in its laundry and paper goods
For 2009, P&G expects net sales growth in the range of
minus 2 percent to minus 4 percent and net earnings in the
range of $4.20 to $4.25 a share. Analysts on average were
expecting $4.23 per share, according to Reuters Estimates.
P&G shares were down 8 cents at $51.70 on the New York
(Reporting by Martinne Geller and Ben Klayman, editing by Dave
Zimmerman and Tim Dobbyn)