Procter & Gamble Shakes Up Its Management, Replaces Jager
CINCINNATI -- Procter & Gamble Co. overhauled its top management yesterday, replacing top executive Durk I. Jager following a series of disappointing earnings results that have led to a profound stock slump at the maker of Tide, Crest and Pampers.
The changes came as the company warned it expects fourth-quarter earnings per share will be equal to last year's, compared with its previous expectations of a 15 percent to 17 percent increase.
Jager, 57, has been president, chief executive and chairman since January 1999. He will retire after 30 years with the Cincinnati-based company, an American industry stalwart built on its 19th century sales successes with soap and candles.
The consumer product company's board of directors elected Alan G. Lafley, 52, president of its divisions for global beauty care and North America, as president and chief executive.
John E. Pepper, 61, who headed P&G before Jager and has been heading its board's executive committee, was elected as the board's chairman.
Investors sent shares of P&G down nearly 10 percent, or $6.13, to $56.75 on the New York Stock Exchange. Since P&G reached its 52-week-high of $118.38 back in January, the company's stock has dropped 52 percent.
P&G did the right thing by reacting now to deal with its problems, rather than letting troubles fester, said analyst Doug Christopher of Crowell Weedon.
"I think it's very healthy," Christopher said. "Past credibility is history. Now they move ahead."
Investor Don Apking, 62, agreed, albeit for different reasons.
"I think they should have done it a long time ago," said Apking , who retired in 1993 after 36 years with P&G and is part of a group of shareholders suing the company over the stock price decline in recent months. …