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Gillette earnings thin out
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October 15, 1998: 6:29 p.m. ET
Weaker overseas markets, MACH3 launch put a substantial dent in 3Q results
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NEW YORK (CNNfn) - Personal-products manufacturer Gillette Co. on Thursday blamed global market weakness and the cost of launching new products for falling third-quarter revenue and profits, but the results were still only marginally below Wall Street expectations.
The Boston-based company posted earnings of $353 million or 30 cents per share in the period ending Sept. 30., down 21 percent from the year-ago figures of $437 million or 38 cents per share.
Analysts polled by First Call had expected the company to earn 31 cents per share.
The bulk of the loss was a result of slipping revenue, which fell to $2.53 billion from $2.70 billion a year ago.
"Our third-quarter results reflect broad-based economic weakness in international markets, the one-time start-up expenses associated with the accelerated launch plan for the MACH3 shaving system and the continuing negative effects of a strong dollar," said Alfred Zeien, Gillette chairman and CEO.
The figures did not take a previously-announced $347 million realignment charge for the divestiture of Jafra Cosmetics International into account, Gillette said. After the charge was applied, the company broke even in the quarter.
In the year to date, Gillette has earned $993 million or 86 cents per share on a fully diluted basis, down slightly from $1.01 billion or 88 cents per share in the prior year.
The company said blade and razor sales were moderately higher although profits decreased substantially from the applicable period of 1997 due to the launch of the MACH3 product.
"The MACH3 shaving system is making excellent progress," said Zeien. "Further, worldwide share positions throughout our core categories continue to improve."
Likewise, sales for the Duracell battery unit were slightly higher but profits were lower. Both sales and profits for toiletries, Oral-B and stationery products were significantly lower in the quarter, the company said.
Gillette stock (G) closed up 2-11/16 at 43-1/16 in high-volume NYSE trading on Thursday. 
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Gillette
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