P&G Reports $20.3 Billion in Net Sales for First Quarter 2022

Procter & Gamble (P&G) reported first quarter fiscal year 2022 net sales rose 5% to $20.3 billion. Organic sales increased 4%. Operating cash flow was $4.6 billion for the quarter.

 

“We delivered solid results in our first quarter of fiscal 2022 in a challenging cost and operating environment,” said David Taylor, chairman, president and CEO. “These results keep us on track to deliver our top-line, bottom-line and cash targets for the fiscal year.”

 

Taylor added that the company remains focused on executing strategies of superiority, productivity, constructive disruption, in addition to continually improving the company’s organization structure and culture. The strategies, he said, enabled the company to build solid momentum before the COVID crisis.

 

The company cites strong consumer demand for superior products and innovation – partially offset by a high base period in some markets due to rebuilding of inventories by retailers – as the main drivers of the volume increase. The positive mix was driven by the disproportionate volume growth of the North America region and the health care business and premium products – all of which constitute higher-than-company-average selling prices.

 

Organic Sales

 

Beauty segment organic sales increased 2% from last year. Hair care organic sales increased low single digits due to pricing and favorable mix from premium innovation in treatments and conditioners. Skin and personal care organic sales increased low single digits, primarily driven by pricing and higher volumes, partially offset by negative geographic mix.

 

Grooming segment organic sales increased 4% from last year. Shave care organic sales increased mid-single digits due to pricing and positive mix from premium innovation. Appliances organic sales decreased mid-single digits. Positive mix was more than offset by a volume decline versus a base period, which benefited from increased consumption due to COVID.

 

Health care segment organic sales increased 7% from last year. Oral care organic sales increased low single digits due to positive geographic and premium product mix, partially offset by a slight decline in shipment volumes. Personal health care organic sales increased double digits primarily due to market recovery of respiratory products, innovation and pricing in some markets.

 

Fabric and home care segment organic sales increased 5% from the previous year. Fabric care organic sales increased high single digits driven by innovation, pricing and mix. Positive mix was driven by disproportionate growth in North America and premium product forms. Home care organic sales increased low single digits primarily due to pricing, partially offset by a base period that benefited from pandemic-related consumption increases in North America.

 

Baby, feminine and family care segment organic sales increased 2% versus a year ago. Baby care organic sales increased mid-single digits due to positive mix from the disproportionate growth of premium pants and taped diapers, pricing and innovation-driven volume growth. Feminine Care organic sales increased mid-single digits primarily driven by innovation, pricing and mix. Positive mix was driven by disproportionate growth in North America and premium products. Family Care organic sales decreased mid-single digits. Higher volumes were more than offset by increased promotional spending versus a base with historically low promotional activity and unfavorable mix due to larger pack sizes.

 

 

Guidance for the Upcoming Fiscal Year 
 

P&G continues to expect fiscal year 2022 all-in sales growth in the range of 2 to 4% versus the prior fiscal year. Foreign exchange is now expected to be neutral to all-in sales growth. The Company also maintained its outlook for organic sales growth in the range of two to four percent.

 

The company said its current outlook estimates headwinds of $2.1 billion after-tax from higher commodity costs and an additional $200 million after-tax from higher freight costs. Foreign exchange is now expected to be approximately neutral to fiscal 2022 after-tax earnings. The approximately $2.3 billion after-tax combined impact of commodity and freight costs represents 90 cents per share headwind to fiscal year 2022 EPS.