Tide laundry detergent is shown on display in Compton, California, U.S., January 10, 2017.
Mike Blake | Reuters
Procter & Gamble on Friday reported quarterly earnings and revenue that beat analysts’ expectations, because of price hikes for products like Crest toothpaste and Pampers diapers.
But the corporate released a depressing outlook for its fiscal 2024 sales that fell wanting Wall Street’s estimates.
Still, shares of P&G rose greater than 2%.
Here’s what the corporate reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:
- Earnings per share: $1.37 vs. $1.32 expected
- Revenue: $20.55 billion vs. $19.98 billion expected
The Tide detergent owner reported fiscal fourth-quarter net income of $3.38 billion, or $1.37 per share, up from $3.05 billion, or $1.21 per share, a 12 months earlier.
Net sales rose 5% to $20.55 billion. Its organic revenue, which strips out the impact of foreign currency, acquisitions and divestitures, increased 8% within the quarter.
For fiscal 2024, P&G is forecasting that its revenue will grow 3% to 4%, lower than Wall Street’s expectations of 4.5% sales growth. The corporate can be projecting earnings per share growth of 6% to 9%, which is on the lower end of analysts’ forecast of 8.8%.
“We’ll undoubtedly experience more volatility within the fiscal 12 months ahead, and while supply chains and input costs have change into more stable as we enter fiscal 2024, the challenges we face are multi-faceted,” CFO Andre Schulten said on the corporate’s conference call.
But one vivid spot is a $400 million after-tax profit from favorable commodity costs, even including currency tail winds.
For roughly two years, P&G has been raising prices on its products to mitigate higher commodity costs. Yet customers have not been as willing to follow P&G’s brands, resulting in five consecutive quarters of volume declines. Volume excludes the impact of currency and pricing changes to reflect demand.
P&G’s volume fell 1% in the course of the quarter. In fiscal 2024, P&G expects its volume will start increasing again, and costs will only rise 1% to 1.5%.
In the US, P&G’s largest market, consumers traded right down to cheaper private-label products. However the market’s volume actually grew 3% within the quarter. Demand was weaker in Europe and Asia Pacific.
The corporate’s health-care segment reported the most important drop in global volume at 3%. The division, which incorporates Oral-B and Pepto-Bismol, scared off North American customers with its higher prices, in keeping with P&G. Europe and Asia-Pacific also saw market contractions.
P&G’s fabric and home-care business, which incorporates Tide and Febreze, saw its volume fall 2%. The corporate said customers in China were buying fewer fabric-care products, like Downy detergent.
The corporate’s grooming segment, which incorporates Gillette and Venus razors, reported its volume shrank 1% within the quarter.
P&G’s baby, feminine and family care and sweetness segments reported flat volume for the quarter.
