CINCINNATI -- Procter & Gamble is about to shrink.
The world's largest consumer products maker said it will shed more than half its brands around the globe over the next year or two, leaving it with about 70 to 80 of its top performers when the nips and tucks are complete. The maker of Duracell, CoverGirl, Pampers and Tide did not say which products it plans to keep but noted that they account for more than 90 percent of its sales.
P&G expects primarily to sell off the brands to other companies. CEO A.G. Lafley said the company should have made the move long ago.
"In an ideal world, we would've done this at the depth of the financial crisis, in the recession," Lafley said Friday during a conference call with analysts and investors. "Having said that, I don't see any reason to wait. I don't see any virtue in waiting another minute."
The Cincinnati-based company had already been trimming its operations, including selling Iams pet food and the rest of its pet business to Mars Inc. The decision to accelerate the process by selling or otherwise eliminating 90 to 100 brands comes as the company fights to boost sluggish sales. For the latest quarter, the company reported a slight decline in sales and missed Wall Street expectations. When discounting factors like foreign exchange rates and divestitures, it said sales rose by 3 percent.
By dramatically trimming its product lineup, Procter & Gamble is hoping to focus more energy on products with bigger potential. With its Always Infinity female hygiene pads, for instance, Lafley said the company didn't adequately communicate to women the new absorbing technology that made them superior.
And he said nearly all the company's products, including in the U.S., are "under-tried," meaning customers haven't given them a chance.
For its fiscal fourth quarter, Procter & Gamble Co. said cost-cutting helped boost its profit by 38 percent. Net income increased to $2.58 billion, or 89 cents per share, for the three months ended June 30.
Excluding one-time items, it earned 95 cents per share, topping the 91 cents per share analysts expected.
Revenue fell slightly to $20.16 billion, missing Wall Street expectations for $20.47 billion.
Full-year net income climbed to $11.64 billion, or $4.01 per share, from $11.31 billion, or $3.86 per share in the previous year. Adjusted profit was $4.22 per share.
For fiscal 2015, P&G anticipates adjusted earnings growth in the range of mid-single digits. Revenue is expected to be in the low single-digit range.
Shares gained $1.67, or 2.2 percent, to $78.99 before the market open.