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2019-08-01 Economy
P&G posts strong sales, takes $8 billion Gillette writedown
[TWITTER] I blame all that toxic masculinity. Don't worry. When men start shaving their legs sales will bounce right back.
If only that was what happened. But actually it’s because more than half of Gillette sales are outside the U.S., and the strengthening dollar impacted numbers, allowing P&G to take a nice — and legal— goodwill tax write off, which sheltered nearly all the profits for this quarter.

Posted by Fred 2019-08-01 00:00|| || Front Page|| [11130 views ]  Top

#1 full report of the quarter is here

The Grooming Sector is about 10% of the company's sales and Gillette is part of that.
Posted by lord garth 2019-08-01 03:25||   2019-08-01 03:25|| Front Page Top

#2 But actually it’s because more than half of Gillette sales are outside the U.S., and the strengthening dollar impacted numbers..

Why is Gillette so dependent upon overseas sales? I sense far more in the future. Mirrors the crap coming from Hollyweird. If you are reliant upon the dollar vs the world, you just put your future in others hands. Maybe not the business plan that is optimal for investors.
Posted by Procopius2k 2019-08-01 07:16||   2019-08-01 07:16|| Front Page Top

#3 If you are reliant upon the dollar vs the world, you just put your future in others hands.

My guess is they have a shit finance team - they're supposed to buy puts & calls on foreign currency to hedge against these fluctuations. Boeing largely avoids this because their contracts are to get paid in USD but not every country is able to do that.
Posted by Raj 2019-08-01 08:22||   2019-08-01 08:22|| Front Page Top

#4 Have you priced a Gillette razor lately? I switched to electric razor and never looked back, I must have saved a couple hundred dollars since then.
Posted by Seeking Cure For Ignorance 2019-08-01 09:15||   2019-08-01 09:15|| Front Page Top

#5 P&G has been an international company since the 1920s, as I recall, and has factories supplying local customers in much of the world. We lived in Germany and Belgium because Mr. Wife was part of the team developing products for Eastern Europe and the former Soviet Union after the Wall fell; his travels in the years before that supported factories manufacturing soap and toothpaste in most of the world except Australia and Antarctica.

My guess is they have a shit finance team - they're supposed to buy puts & calls on foreign currency to hedge against these fluctuations.

Raj, Mr. Wife tells me that P&G does not play the puts/calls game, because that only protects against short term fluctuations, not trends a decade or more out. The company sources materials and has factories all over the world. And given that the writedown actually benefits the company’s bottom line...
Posted by trailing wife 2019-08-01 10:15||   2019-08-01 10:15|| Front Page Top

#6 I've been retired for a few years, and the accounting rules may have changed. But back in the day goodwill amortization and writeoffs were after tax--so did not shelter income from taxation.
Posted by Tom 2019-08-01 11:53||   2019-08-01 11:53|| Front Page Top

#7 Still ain't buying their overpriced shit.

Dollar Shave Club all the way, baby!
Posted by DarthVader 2019-08-01 12:14||   2019-08-01 12:14|| Front Page Top

#8 P&G has long been known to investment bankers as having really shitty risk management capabilities.

Back in the day, the head of Citibank joked that P&G management should do "more proctoring and less gambling" with company finances.
Posted by Lex 2019-08-01 15:38||   2019-08-01 15:38|| Front Page Top

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