PG beats 4Q forecasts but irks activist investor Trian

Procter & Gamble reported profit and revenue that beat Wall Street expectations, but it wasn’t good enough for at least one major shareholder. The world’s largest consumer products maker posted fiscal fourth-quarter profit of $2.22 billion, beating Wall Street forecasts and the $1.95 billion posted in the same quarter last year.

But the company has consistently trailed its competitors, drawing the ire of activist investor Trian Fund Management, led by Nelson Peltz. In a statement, Trian said P&G “needs to address the root causes of this consistent underperformance, including deteriorating market share across most of its categories and excessive cost and bureaucracy. While P&G says it is addressing the underperformance issue, shareholders have heard similar promises in the past and results have not materially improved.”

The maker of Tide detergent and Charmin toilet paper has been shedding underperforming brands for years in an attempt to boost profits. Its shares are up almost 7 percent in the past 12 months, but have lagged behind competitors Unilever, Johnson & Johnson and Colgate-Palmolive for years.

Trian, which FactSet lists as the fifth largest shareholder with approximately $3.3 billion of P&G shares, suggested appointing Peltz to the Board of Directors.

“Nelson Peltz has been involved with numerous successful turnarounds of consumer brands and businesses, and adding him to the P&G Board will help P&G become bestin-class,” Trian said. “As a motivated independent director, he will have a laser focus on long-term shareholder value creation that can accelerate positive change at P&G.” (AP)