P&G`s Q1 net sales rise by just 1%, as the company lowers guidance for the fiscal year
Net sales at Procter & Gamble rose 1% to $20.612 billion in the three months ending September, which is the first financial quarter of 2023. The cost of products sold was up by 5%.
The company announced on Wednesday that unfavorable foreign exchange had a six percent impact on net sales.
Organic sales, which exclude the impacts of foreign exchange and acquisitions and divestitures, grew by 7%.
This was mainly because of a 9% increase in charging more, and a one percent increase from positive product mix. But shipment volumes decreased by 3%.
“We delivered solid results in a very difficult cost and operating environment,” said Jon Moeller, the CEO of P&G.
Volume fell just 3% even as prices rose, and a big part of that decline came because of less business in Russia.
Although the Cincinnati-based company is maintaining some pricing power, the figures suggest people are about to ditch some of their few remaining small joys.
Sales grew in three out of five categories, but mostly for things like toothpaste, baby wipes and laundry detergent.
Grooming sales fell, while beauty was flat. For the rest of the fiscal year, the company lowered guidance, saying total sales would be down 1% to 3% year-over-year, instead of flat to up 2%.
It seems that P&G is expecting a rapid change in shopper’s habits, while Fitch Rating says a recession is likely in 2023, even though the U.S. consumer is strong.
People soon might start pulling back on necessary goods, either by buying generic or cutting back on what they use.
P&G’s adjusted guidance range for fiscal year 2023 means that risks and uncertainties are taken into consideration.
Procter & Gamble reported yesterday net sales of $20.6 billion for the third quarter 2022. Sales increased 1% from the same period a year ago beating estimates of $20.3 billion, according to Refinitiv. Net earnings attributable to the company were $3.9 billion, a 4% year-over-year drop.