Quarterly Profit Dips at Two Gillette Units

Procter & Gamble Co. posted declining quarterly profits at two of Gillette Co.’s business units, batteries and razors, due to higher advertising costs, one-time charges and ho-hum sales. Procter acquired the divisions as part of its takeover of Gillette, but did not include their performance in its recent first-quarter earnings report because the three-month period ended Oct. 30 and the merger was complete Sept. 1. According to a document filed with the Securities and Exchange Commission, P&G said profits at the razors and blades division slipped by 7% ($382 million), on a sales gain of 5% ($1.2 billion). The decline was driven by higher advertising expenses and one-time items such as asset write-offs and charges from an advertising claim settlement. At the batteries and Braun division, profits declined 6% ($153 million) on flat sales of $912 million. In addition to lackluster sales activity, profits slipped on costs related to the shuttering of a Lexington plant. P&G said it plans to report the two divisions as a separate Gillette business unit in future filings. Gillette’s oral-care business will be reported within P&G’s healthcare division; its and personal-care businesses will be reported within P&G’s beauty-care unit.