PG0.png

Summary

  • Procter & Gamble is a global leader in the fast-moving consumer goods.
  • Its products are sold in approximately 180 countries and territories and has on-the-ground operations in approximately 70 countries.
  • P&G own and operate 23 manufacturing sites in USA. In addition, the company own and operate 81 manufacturing sites in 35 other countries.

Procter & Gamble (NYSE: PG, LSE: 0NOF) is a global leader in the fast-moving consumer goods industry. The company's products are sold in approximately 180 countries and territories. P&G has on-the-ground operations in approximately 70 countries.

PG4.png

Financial Highlights

Fiscal Year 2023 Second Quarter Results1

1/19/2023; The Procter & Gamble Company reported second quarter fiscal year 2023 net sales of $20.8 billion, a decrease of one percent versus the prior year. Excluding the impacts of foreign exchange and acquisitions and divestitures, organic sales increased five percent. Diluted net earnings per share were $1.59, a decrease of four percent versus prior year EPS.

Operating cash flow was $3.6 billion, and net earnings were $4.0 billion for the quarter. Adjusted free cash flow productivity was 72%, which is calculated as operating cash flow, less capital spending, as a percentage of net earnings. The Company returned $4.2 billion of cash to shareholders via approximately $2.2 billion of dividend payments and $2 billion of common stock repurchases.

Diluted net earnings per share decreased by four percent to $1.59, driven by a decline in net sales and a decrease in operating margin partially offset by a lower effective tax rate and a reduction in shares outstanding. Currency-neutral EPS were up five percent versus the prior year EPS.

Gross margin for the quarter 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.

Operating margin for the quarter decreased 170 basis points versus the prior year, 70 basis points on a currency-neutral basis. Operating margin included gross productivity savings of 110 basis points.

Fiscal Year 2023 Guidance

P&G raised its guidance for fiscal 2023 all-in sales to a range of down one percent to in-line versus the prior fiscal year from a prior range of down three percent to down one percent. The Company also raised its outlook for organic sales growth to a range of four to five percent versus the prior fiscal year from a prior growth range of three to five percent. Foreign exchange is now expected to be a five percentage point headwind to all-in sales growth for the fiscal year.

Fiscal Year 2022 Annual Results

Net sales increased 5% to $80.2 billion on a 2% increase in unit volume. Unfavorable foreign exchange had a negative 2% impact on net sales. Net sales growth was driven by a high single digit increase in Health Care, mid-single digit increases in Fabric & Home Care and Baby, Feminine & Family Care and low single digit increases in Beauty and Grooming. Excluding the impact of acquisitions and divestitures and foreign exchange, Organic sales increased 7% on a 2% increase in organic volume. Organic sales increased double digits in Health Care, increased high single digits in Fabric & Home Care, increased mid-single digits in Baby, Feminine & Family Care and in Grooming and increased low single digits in Beauty.

Operating income decreased $0.2 billion, or 1% versus year ago to $17.8 billion, as the increase in net sales was more than offset by a decrease in operating margin.

Net earnings increased $0.4 billion or 3% versus year ago to $14.8 billion, due to a prior year loss on early debt extinguishment, lower taxes and interest expense in the current year. Foreign exchange impacts negatively affected net earnings by approximately $274 million.

Net earnings attributable to Procter & Gamble were $14.7 billion, an increase of $0.4 billion or 3% versus the prior year primarily due to the increase in net earnings.

Diluted net earnings per share (EPS) increased 6% to $5.81 due to the increase in net earnings, a reduction in shares outstanding and due to the prior year loss on early debt extinguishment. Cash flow from operating activities was $16.7 billion.

PG1.jpg

Company Overview

Procter & Gamble is a global leader in the fast-moving consumer goods industry. The Company was incorporated in Ohio in 1905, having first been established as a New Jersey corporation in 1890, and was built from a business founded in Cincinnati in 1837 by William Procter and James Gamble. Today, its products are sold in approximately 180 countries and territories. P&G has on-the-ground operations in approximately 70 countries.2

Business Segments

Beauty

P&G is a global market leader amongst the beauty categories in which the company compete, including hair care and skin and personal care. P&G is a global market leader in the retail hair care market with more than 20% global market share primarily behind its Pantene and Head & Shoulders brands. In skin and personal care, the company offer a wide variety of products, ranging from deodorants to personal cleansing to skin care, such as its Olay brand, which is one of the top facial skin care brands in the world with approximately 6% global market share.

Grooming

The company compete in shave care and appliances. In shave care, P&G is the global market leader in the blades and razors market. The company's global blades and razors market share is more than 60%, primarily behind its Gillette and Venus brands. The company's appliances, such as electric shavers and epilators, are sold primarily under the Braun brand in a number of markets around the world where the company compete against both global and regional competitors. The company hold over 25% of the male electric shavers market and over 65% of the female epilators market.

Health Care

The company compete in oral care and personal health care. In oral care, there are several global competitors in the market and P&G has the number two market share position with nearly 20% global market share behind its Crest and Oral-B brands. In personal health care, P&G is a global market leader among the categories in which the company compete, including respiratory treatments, digestive wellness, vitamins and analgesics behind its Vicks, Metamucil, Pepto-Bismol and Neurobion brands.

Fabric & Home Care

This segment is comprised of a variety of fabric care products, including laundry detergents, additives and fabric enhancers; and home care products, including dishwashing liquids and detergents, surface cleaners and air fresheners. In fabric care, the company generally have the number one or number two market share position in the markets in which the company compete and are the global market leader with over 35% global market share, primarily behind its Tide, Ariel and Downy brands. The company's global home care market share is nearly 25% across the categories in which the company compete, primarily behind its Cascade, Dawn, Febreze and Swiffer brands.

Baby, Feminine & Family Care

In baby care, P&G is a global market leader and compete mainly in taped diapers, pants and baby wipes with more than 20% global market share. P&G has the number one or number two market share position in most of the key markets in which the company compete, primarily behind Pampers, the Company's largest brand, with annual net sales of over $7 billion. P&G is a global market leader in the feminine care category with over 20% global market share, primarily behind its Always and Tampax brands. The company also compete in the adult incontinence category in certain markets behind Always Discreet, with over 10% market share in the key markets in which the company compete. The company's family care business is predominantly a North American business comprised primarily of the Bounty paper towel and Charmin toilet paper brands. North America market shares are over 40% for Bounty and over 25% for Charmin.

PG2.png

Brands

Many of Procter & Gamble brands have worldwide recognition.

Home CareFabric CareSkin and Personal CarePersonal Health CareHair CareBaby CareFeminine CareGroomingOral CareFamily Care
Ambi PurArielGilletteAlignAussieAll GoodAlwaysBraunCrestBounty
CascadeBounceIvoryClearblueHead & ShouldersCharlie BananaAlways DiscreetGilletteFixodentCharmin
DawnCheerNativeMetaHerbal EssencesLuvsJustjoy+gleeOral-BPuffs
FebrezeDownyOlayPepto-BismolMy Black Is BeautifulNinjamasTampaxVenusScope 
GainDreftOld SpicePrilosec OTCOld SpicePampersThis is LThe Art of Shaving  
Microban 24EraSafeguardVicksPantene     
Mr. CleanGainSecretZzzQuil      
SalvoRindex 3en1SK-II       
SwifferTide        
Zevo         

PG3.jpg

Manufacturing

P&G own and operate 23 manufacturing sites located in 17 different states. In addition, the company own and operate 81 manufacturing sites in 35 other countries. Many of the domestic and international sites manufacture products for multiple businesses. Beauty products are manufactured at 22 of these locations; Grooming products at 17; Health Care products at 20; Fabric & Home Care products at 38; and Baby, Feminine & Family Care products at 37. The company own its Corporate headquarters in Cincinnati, Ohio. The company own or lease its principal regional general offices in Switzerland, Panama, Singapore, China and Dubai. The company own or lease its principal regional shared service centers in Costa Rica, the United Kingdom and the Philippines. Management believes that the Company's sites are adequate to support the business and that the properties and equipment have been well maintained.

References

  1. ^ https://www.pginvestor.com/financial-reporting/press-releases/news-details/2023/PG-Announces-Fiscal-Year-2023-Second-Quarter-Results/default.aspx
  2. ^ https://fintel.io/doc/sec-procter-gamble-co-80424-11k-2022-december-12-19338-9252
Tags: US:PG GB:0NOF USA
Created by Asif Farooqui on 2023/01/25 06:15
     
This site is funded and maintained by Fintel.io