Excluding the impacts of foreign exchange and acquisitions and divestitures, the company’s organic sales increased 5 per cent in Q2 FY23. Diluted net earnings per share were $1.59, a decrease of 4 per cent versus prior year’s EPS, P&G said in a media release.
The company’s gross margin for Q2 FY23 decreased 160 basis points versus year ago, 100 basis points on a currency-neutral basis. The decline was driven by 380 basis points of increased commodity and input material costs, 130 basis points of negative product mix, and 140 basis points of capacity start-up costs and other impacts. These were partially offset by benefits of 470 basis points from increased pricing and 80 basis points from gross productivity savings.
Selling, general and administrative expense as a percentage of sales increased 10 basis points in Q2 FY23 versus year ago and decreased 30 basis points on a currency-neutral basis.
In Q2 FY23, P&G’s baby, feminine, and family care segment’s organic sales increased 4 per cent versus a year ago. Baby care organic sales increased in low single digits due to increased pricing, partially offset by volume declines from market contraction. Feminine care organic sales increased in high single digits, driven by increased pricing and positive geographic mix, and partially offset by volume declines in emerging markets. Family care organic sales increased low single digits due to increased pricing, partially offset by lower volumes due to market contraction and market share softness.
P&G raised its guidance for fiscal 2023 all-in sales to a range of down 1 per cent to in-line versus the prior fiscal year from a prior range of down 3 per cent to down 1 per cent. The company also raised its outlook for organic sales growth to a range of 4-5 per cent versus the prior fiscal year from a prior growth range of 3-5 per cent.
P&G maintained its outlook for fiscal 2023 diluted net earnings per share growth in the range of in-line to up 4 per cent versus fiscal 2022 EPS of $5.81. The company added that given continued significant cost headwinds from commodity and materials costs and foreign exchange impacts, it continues to expect EPS results to be towards the lower end of the fiscal year guidance range.
Fibre2Fashion News Desk (DP)