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Procter & Gamble Q4 Results Beat View

Procter & Gamble Co. (PG) reported that its fourth-quarter net earnings attributable to the company was $2.80 billion or $1.07 per share, compared to net loss of $5.24 billion or $2.12 per share in the prior year, due primarily to the impairment charge for the Gillette Shave Care business in the base year.

Core earnings per share were $1.16, a five percent increase versus the prior year, driven by the net sales increase and an increase in operating margin. Currency-neutral core earnings per share increased 11%. Analysts polled by Thomson Reuters expected the company to report earnings of $1.01 per share for the fourth-quarter. Analysts' estimates typically exclude special items.

Net sales in the fourth quarter of fiscal year 2020 were $17.70 billion, an increase of four percent from the prior year. Analysts expected revenues of $16.97 billion for the quarter.

Unfavorable foreign exchange negatively impacted sales by three percentage points for the quarter. Excluding the impacts of foreign exchange, acquisitions and divestitures, organic sales increased six percent driven primarily by a three percent increase in organic shipment volume.

The volume increase was driven by strong programs and increased consumer demand for household cleaning, personal health and cleansing products, particularly in North America and China, related to the COVID-19 pandemic. The increases were partially offset by volume decreases in other regions and certain categories primarily due to the disruption of consumer access to retail markets caused by the pandemic.

The company expects fiscal 2021 all-in sales growth in the range of one to three percent versus the prior fiscal year. This includes an estimated one percent negative impact from foreign exchange. The company targets organic sales growth in the range of two to four percent.

P&G expects fiscal 2021 GAAP net earnings per share growth in the range of six to ten percent versus fiscal 2020 GAAP earnings per share of $4.96. Core earnings per share growth for fiscal 2021 is expected to be in the range of three to seven percent versus fiscal 2020 core earnings per share of $5.12.

P&G targets adjusted free cash flow productivity of 90% and expects to pay approximately $8 billion in dividends and repurchase $6 billion to $8 billion of common shares in fiscal 2021.

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