P&G tops earnings and sales estimates after hiking prices

Brian Sozzi
·Executive Editor
Updated 2 min read
171
In this article:

It was another clean quarter from Tide maker Procter & Gamble (PG).

Shares of the consumer products giant rose nearly 2% in premarket trading on Wednesday amid better-than-expected fiscal first quarter results.

P&G chairman and CEO Jon Moeller characterized the quarter as "strong" in an interview with Yahoo Finance.

Despite increasing stress on consumer budgets, P&G was able to successfully push through price increases as it continues to double down on new product innovations.

The company saw organic sales growth in all product categories, led by a 10% increase in the healthcare business on the back of demand for Crest toothpaste and whiteners.

"Overall we view the result as solid and reflective of topline momentum and reinvestment positioning the company to accelerate organic volume growth," said Stifel analyst Mark Astrachan in a note to clients.

BEIJING, CHINA - 2010/06/09: Crest toothpaste, a Procter & Gamble product, competes for space with Colgate (a Colgate-Palmolive brand) on a supermarket's shelves. Procter & Gamble and Colgate-Palmolive products are both the biggest American brands of consumer products in Chinese market. (Photo by Zhang Peng/LightRocket via Getty Images)
Crest toothpaste, a Procter & Gamble product, on a Beijing supermarket shelf. (Zhang Peng/LightRocket via Getty Images) (Zhang Peng via Getty Images)

The earnings rundown

  • Net sales: $21.9 billion, up 6% from the prior year vs. (consensus) estimate of $21.62 billion

  • Organic sales growth: 7% vs. 5.83% estimate

    • Beauty Segment organic revenue growth: 5% vs. 6.55% estimate

    • Grooming Segment organic revenue growth: 9% vs. 6.88% estimate

    • Healthcare Segment organic revenue growth: 10% vs. 4.88% estimate

    • Fabric & Home Care Segment organic revenue growth: 9% vs. 6.43% estimate

    • Baby, Feminine & Family Care Segment organic revenue growth: 7% vs. 6.56% estimate

  • Operating profits: $5.76 billion vs. estimate of $5.34 billion estimate

  • Adjusted EPS: $1.83, up 17% from the prior year vs. estimate of $1.72

What else caught our attention: Forward guidance

  • P&G reiterated its fiscal year profit outlook in a range of $6.25 to $6.43 per share. The company sees an $800 million tailwind from lower commodities costs.

  • Fiscal first quarter gross profit margins rose 460 basis points from a year ago, in large part because of higher product prices and easing commodities costs.

Brian Sozzi is Yahoo Finance's Executive Editor. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn. Tips on deals, mergers, activist situations, or anything else? Email brian.sozzi@yahoofinance.com.

Click here for the latest stock market news and in-depth analysis, including events that move stocks

Read the latest financial and business news from Yahoo Finance

Advertisement

Recommended Stories