Gillette’s Profit Up, Helped by Battery Sales

Gillette Co., Boston, MA, the world’s largest maker or razor blades and batteries, said on Tuesday that profit rose in the first quarter on the weaker dollar and consumers stocking up on batteries amid Homeland Security concerns.

But the company also said it expected sales of Duracell batteries, which rose 16% in the quarter despite a price cut, to slow during the year as consumers use up excess batteries. In January, Gillette’s Duracell unit decided to cut prices on its popular AA- and AAA-sized batteries in order to narrow the gap with lower-priced and private-label battery makers, a move it said would cut Duracell sales by mid-single digits this year.

Gillette, which also makes Venus and Mach3 razors and OralB toothbrushes, posted profit of $263 million compared with $223 million a year ago.

Sales rose 14% to $1.97 billion, with weakness of the dollar against the euro helping add 5 percentage points to sales growth. Sales of Mach3 Turbo razors in Europe and new toothbrush products added to growth, the company said.

Duracell sales rose 16% to $384 million in the quarter and were also aided by sales to the military, the company said. Sales of razors and blades rose 16% to $893 million. Unlike in batteries, Gillette has been able to take annual price increases on razors and blades. Oral care sales rose 11% to $295 million. But profit from that segment fell 7% to $49 million, due to costs of extended warranties in Europe and higher marketing costs.