The Procter & Gamble Company (NYSE: PG) announced its fiscal Q2 results on Thursday with net sales of $20.8 billion, down 1% year-over-year but still beating Street estimates by $50 million. Core adjusted earnings came in at $1.59 per share, a drop of 4% year-over-year but were in-line with Street estimates.
In spite of “significant headwinds,” the consumer goods giant raised its FY23 guidance and now expects sales to either decline by 1% or grow in-line year-over-year versus its prior outlook of a drop in sales in the range of 1% to 3%.
PG anticipates organic sales to rise in the range of 4% to 5% in FY23 versus its earlier guidance of a growth rate between 3% and 5%. When it comes to its diluted earnings, the company expects diluted EPS to be in-line or register a growth of 4% year-over-year.
P&G stated in its press release, “… 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.”
The company added that its FY23 outlook includes headwinds due to exchange rate fluctuations of around $1.2 billion after-tax, higher commodity costs of $2.3 billion, and another $200 million as a result of higher freight costs.
Analysts are cautiously optimistic about PG stock with a Moderate Buy consensus rating based on seven Buys and five Holds.