Procter & Gamble (PG) - Get Procter & Gamble Company Report posted stronger-than-expected first quarter earnings Tuesday, but held onto prior profit and sales forecasts for the full year amid supply chain disruptions and rising input costs for the consumer brands group.
Procter & Gamble said core earnings for the three months ending in September, the group's fiscal first quarter, were pegged at $1.61 per share, a 1.2% decrease from the same period last year but 2 cents ahead of the Street consensus forecast. Group net sales, Procter & Gamble said, rose 5.2% to $20.3 billion, just ahead of analysts' estimates of a $19.87 billion tally.
For the current fiscal year, P&G maintained its sales growth forecast of between 2% and 4%, and sees core earnings growing between 3% and 6% from the 2021 tally of $5.66 per share.
“We delivered solid results in our first quarter of fiscal 2022 in a challenging cost and operating environment,” said CEO David Taylor. “These results keep us on track to deliver our top-line, bottom-line and cash targets for the fiscal year. We remain focused on executing our strategies of superiority, productivity, constructive disruption and continually improving P&G’s organization structure and culture."
"These strategies enabled us to build strong momentum before the COVID crisis and accelerate progress as we navigate through the crisis, and they remain the right strategies to deliver balanced growth and value creation,” he added.
Procter & Gamble shares were marked 2% lower in early Tuesday trading immediately following the earnings release to change hands at $139.50 each.
Earlier this year, P&G said longtime executive Jon Moeller would replace Taylor as CEO on November 1, following stints as both CFO and COO of the Cincinnati-based group.
The move was followed by the departure of activist investor Nelson Peltz from the P&G board in August, which ended a three-year spell and failed attempt to split the group apart in 2017.
"We think that Procter & Gamble deserves credit for maintaining its FY22 EPS outlook despite its expectation for greater cost pressures than what was initially anticipated back when guidance was first provided in July, and we think management is just being conservative on the top line given that the company still has three quarters ahead," said JPMorgan analyst Andrea Teixeira.