Procter & Gamble Co (NYSE:PG) has topped Wall Street estimates in terms of earnings and revenue as its fiscal first-quarter report was disclosed Tuesday. The company accrued revenue of $20.34 billion compared to $19.91 expectations, up 5% from last year.
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Fiscal Results
As reported by CNBC, the consumer giant also reported this quarter a net income of $4.11 billion, or $1.61 per share, down from $4.28 billion, or $1.63 per share, a year earlier, as “analysts surveyed by Refinitiv were expecting earnings per share of $1.59.”
Organic sales grew with the aid of a 1% price jump in products like Pamper diapers, as price hikes compensated for increasing freight costs during the period. However, it was not enough to offset the rising cost of commodities.
In fact, as inflation hits, after-tax commodity costs are expected to reach $2.1 billion while freight costs are forecast to hit $200 million in the company’s fiscal results for 2022. This will be translated into higher prices for consumer staples, as reported by The Wall Street Journal.
Andre Schulten, CFO of Procter & Gamble said in a press call, “We base our forecast on spot rates, so we don’t expect any easing on commodity cost forecasts.”
Top Performers
“We can’t expect to reduce costs,” Schulten also said. “Although the pace is slow, we see an increase every week.”
The segment which performed best during the quarter was healthcare, reporting organic sales growth of 7%, with brands such as Vicks and Pepto Bismol. The business unit was followed by fabric and home care, the biggest category in the company, with a 5% increase.
The grooming segment was also on the rise with a 4% increase in organic sales, with brands like Braun, Gillette, and Joy+Glee. Meanwhile, baby care hit a 2% increase, led by consumers turning to premium Pampers diapers, which saw significant growth.
Despite increasing costs, CNBC reports the company restated its prior forecast for full-year earnings and revenue, as “P&G is calling for fiscal year sales to grow 2% to 4% from the prior year and core earnings per share to increase by 3% to 6%.”
