Fearing a slow second quarter ahead, the world’s leading consumer goods manufacturer Procter & Gamble Co. (PG) has decided to halt recruitment for the coming six months. The consumer giant chose to shed its workforce to cut down on the operational costs.

Instead of retrenching its human resource, the company is devising a $1 billion restructuring that includes voluntary early retirement incentive packages for some employees.

Since 2009, P&G has increased its work force from 127,000 to about 129,000 worldwide employees. P&G is based in Cincinnati, and has about 12,000 employees in that area.

The company is afraid of a challenging December quarter, bogged down by difficult commodity cost comparisons. Worsening currency and the volume growth being pressurized by slow growth in the developed market are expected to make matters worse.

For the December quarter, earnings per share are estimated to be in the range of $1.05 to $1.11, or down 5%-to-flat versus earnings per share of $1.11 in the base period. Compared to base period core earnings per share of $1.13, earnings per share are expected to be down $7 to down 2%.

P&G Coupons on Phones

Separately, P&G said it is working with a start-up company, mobeam Inc., on a pilot program that will allow consumers to redeem coupons for P&G products straight from their phones. San Francisco-based mobeam has patented a way to beam out a bar code from the screen of a phone that is legible to normal laser scanners.

Mobeam confirmed that it is in talks with several mobile manufacturers to include the necessary technology in the tens of millions of phones that will hit the market in 2012. Mobeam was tight-lipped about the names of the device makers, but incidentally, Samsung Venture Investment Corp. had recently invested in mobeam.

Procter & Gamble Co. reported modest results for the first quarter 2012, with net earnings from continuing operations inching up 1.0% year over year to $1.03 a share, which were in line with the Zacks Consensus Estimate. Profits were driven by efforts to enhance productivity and cost-saving initiatives.

Currently, we prefer to be Neutral on P&G’s stock. Furthermore, P&G holds a Zacks #3 Rank, which translates into a short-term ‘Hold’ rating.

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