2nd profits warning for Procter and Gamble

Published:  21 Jun at 6 PM

For the second time in two months, Procter and Gamble (P&G), which manufactures Duracell batteries and Pampers nappies, has slashed its sales and profits predictions.

The globe’s largest maker of household products has predicted sales to be 3 percent higher than in 2011 during the three months until the end of June, instead than 5 percent. The firm cautioned that profit would also see lower numbers due to the economic struggle in the EU.

Danone, the globe’s top yogurt-producer, released a profit warning as well. In an effort to slash costs by $10 billion before 2016, the firm announced plans to slash over 4,000 jobs. This was on top of 1,600 job cuts unveiled in 2011.

P&G's CEO Bob McDonald expressed his satisfaction with the group's advancement in reducing costs, but admitted the firm still needed to restore its profitability. The company blamed weakened sales in developed markets including the United States and Europe.

Cheaper rival brands are also winning out in the market, as European and US households reduce their monthly grocery bills. Shares for P&G opened down by 3.7 percent in early New York trading.