- Procter & Gamble on Tuesday reported mixed quarterly earnings and revenue for its fiscal second quarter.
- The company narrowed its outlook for full-year adjusted earnings per share, although its forecast for unadjusted earnings fell due to its plans to write down Gillette and restructure certain markets.
- After roughly two years of higher prices on their Charmin toilet paper and Downy fabric softener, consumers have pulled back on their purchases of P&G products.
Procter & Gamble on Tuesday reported mixed quarterly earnings and revenue for its fiscal second quarter of 2024 as price hikes helped boost revenue 3%.
The company also narrowed its outlook for full-year adjusted earnings per share to a range of $6.37 to $6.43, although its forecast for unadjusted earnings fell due to its plans to write down Gillette and restructure certain markets.
Shares of the company rose about 1% in premarket trading.
Here’s what P&G reported compared with what Wall Street was expecting, based on a survey of analysts by LSEG, formerly known as Refinitiv:
- Earnings per share: $1.84 adjusted vs. $1.70 expected
- Revenue: $21.44 billion vs. $21.48 billion expected
P&G reported fiscal second-quarter net income attributable to the company of $3.47 billion, or $1.40 per share, down from $3.93 billion, or $1.59 per share, a year earlier.
The Tide detergent owner wrote down the value of razor brand Gillette by $1.3 billion, following through on an announcement it made in December. The company previously said it would record up to $2.5 billion in charges over the next two fiscal years related to Gillette impairment charges and restructuring its business in some markets, like Argentina and Nigeria.
Excluding the impacts of restructuring and intangible impairment, the company earned $1.84 per share.
Net sales rose 3% to $21.44 billion. P&G’s organic revenue, which strips out the impact of acquisitions, divestitures and foreign exchange, rose 4% in the quarter.
Product volumes
After roughly two years of higher prices on their Charmin toilet paper and Downy fabric softener, consumers have pulled back on their purchases of P&G products. The company’s volume was flat overall for the quarter, and only its grooming business reported volume growth. The metric excludes the impact of currency and pricing changes to reflect demand.
The grooming division, which includes Gillette, saw volume grow 1% in the quarter.
P&G’s beauty segment reported flat volume for the quarter as sales of its pricey SK-11 skincare brand continued to struggle. Its fabric and home care business also reported flat volume.
The company’s health care division reported volume declines of 3%. P&G said the market for respiratory products, like its brand Vicks, shrank during the quarter.
P&G’s feminine, baby and family care business saw its volume fall 2% in the quarter, fueled by shrinking demand for its diapers and tampons. Of that division, only its family care segment, which includes Bounty paper towels, saw volume increase.
For fiscal 2024, the company now anticipates core earnings per share growth of 8% to 9%, narrowing its prior range of 6% to 9%. However, it now expects unadjusted earnings per share to be flat to down 1%, significantly lower than a prior range of 6% to 9% growth.
P&G reiterated its forecast for fiscal sales growth of 2% to 4%.
This story is developing. Please check back for updates.
Source: Business - cnbc.com
