Cincinnati's Procter & Gamble is one of Ohio's largest companies in terms of revenue. (Photo credit: Wikipedia)  Procter & gamble is on the right track, as its fiscal second quarter earnings revealed on Friday. The company easily topped analysts’ profit estimates, expanded core gross margins substantially, grew market share, and increased its guidance. Happy investors met the results with more buying, sending the stock up nearly 4% in early trading in New York.  The company that boasts it serves 4.6 billion around the world grew core EPS 12% to $1.22, beating the consensus call by an 11-cent margin. Procter & Gamble’s organic sales growth hit 3%, toward the top-end of their guidance, while net revenue inched up 2% to $22.2 billion.  Among the most impressive numbers unveiled by the company on Friday were its margins. Core gross margin expanded 110 basis points (Citi’s analysts expected a 50 basis point move) to 51.5% on pricing benefits and manufacturing cost savings. Core operating profit jumped 7% while operating income surged 68% to $4.5 billion.  Procter & Gamble didn’t stop there. Beyond its stellar margin numbers, the company managed to gain or hold approximately market share in 50% of its global businesses, up from 45% last quarter; in the U.S., they did it for 60% of their sales. Expect this trend of improvement to continue, Citi’s analysts said, as newly released and coming products keep the momentum going.  “Global market share trends improved as we continued to implement our growth strategy and made very good progress against our productivity and cost savings goals. Our strong first half results have enabled us to raise our sales, earnings and share repurchase outlook for the fiscal year, while we strengthen investments in our innovation and marketing programs,” explained Bob McDonald, chairman and CEO of Procter and Gamble.  The company raised its organic sales growth target for fiscal 2013 to 3% to 4% (from 2% to 4%) and their core EPS forecast to $3.97 to $4.07 (from $3.80 to $4.00 previously). They now expect to buy back between $5 and $6 billion in stock this year.  Procter’s increased guidance and solid quarter could indicate the global consumer is beginning to look healthier. It does clash with Johnson & Johnson’s recent guidance, which came in below expectations and sent the stock down on Tuesday. Procter’s earnings report also revealed some weakness in Western Europe, and strength in Asia, which is similar to what companies like Starbucks have experienced. McDonald’s, another company with global reach, recently posted weak earnings, casting doubt over the strength of the global recovery  Shares in Procter & Gamble rallied onto the open and essentially stayed up there through the trading session. By 11:49 AM in New York, the stock was up 3.6% to $72.97.
Procter &amp; Gamble had a solid second quarter, delivering big margin expansion as core sales grew and guidance was raised.