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Procter & Gamble

(PG) - Get Procter & Gamble Company Report

said fiscal second-quarter sales rose 9% from a year ago, while earnings exceeded the high end of the company's forecast.

Along with reporting its results, P&G said it plans to shed its coffee business and create an independent company named Folgers Coffee.

The consumer products giant had revenue of $21.6 billion in the most recent quarter, up from $19.7 billion a year earlier. P&G earned $3.3 billion, or 98 cents a share, compared with $2.9 billion and 84 cents a share in the 2006 quarter.

Analysts surveyed by Thomson Financial were calling for a profit of 97 cents and sales of $21.3 billion.

"This quarter is another demonstration of P&G's capability to deliver strong results in a difficult competitive and commodity cost environment," said A.G. Lafley, chairman and CEO, in a prepared statement. "Solid top line growth and a sharp focus on cost control are driving strong profit and cash generation. Looking ahead, we are confident that the strength of the company's brand portfolio, initiative pipeline and productivity program will enable P&G to continue delivering at or ahead of its targets."

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The coffee division that's being separated had sales of approximately $1.6 billion and operating income of about $350 million in fiscal 2007. The new company will employ roughly 1,250 employees at four sites in the U.S. and will be based in Cincinnati.

Jamie Egasti will serve as chief executive of Folgers. He's currently the president of coffee and global snacks at P&G.

For fiscal 2008, the company expects organic sales to grow 4% to 6%, in line with its long-term target range. Total sales should increase 7% to 9%, up one percentage point from the prior outlook owing to the anticipated benefits of the weak dollar.

P&G is looking for a profit of $3.46 to $3.50 for the year, up 14% to 15% from fiscal 2007. The previous outlook was $3.46 to $3.49.

As for the fiscal third quarter, sales are expected to increase 8% to 10% with earnings of 79 cents to 81 cents a share. On average, analysts are projecting 83 cents for the quarter and $3.49 for the year.

Shares of P&G were slipping 1.3%.

This article was written by a staff member of TheStreet.com.