Procter & Gamble on Wednesday reported net sales of $21.0 billion for its fiscal second quarter that ended Dec. 31, a 6% YOY increase that the company attributed equally to higher volumes and price increases.
Growth was led by a 20% sales jump in personal health care, attributed “primarily to growth in respiratory products due to a more intense cough/cold/flu season.” P&G’s personal health care category includes brands acquired in its 2018 acquisition of Merck’s OTC business, a deal company president/CEO Jon Moeller termed “incredibly successful” during an earnings call discussing the quarterly results.
P&G simultaneously raised its organic sales growth outlook guidance for fiscal 2022 from a range of 2% to 4% to a range of 4% to 5%, with Moeller saying, “Our algorithm assumes 100% organic growth.” However, Moeller didn’t rule out possible upcoming acquisitions in skin care and, once again, in personal health care.
Other P&G categories showing double-digit growth for the second quarter were fabric care, “led by strong growth of unit-dose detergents and fabric enhancers,” and feminine care, “driven by commodity-based price increases, innovation, and positive geographic and product mix.”
Baby care sales, meanwhile, increased in the high single digit percentages, with “most of the growth, if not the absolute majority” coming from what chief financial officer Andre Schulten called Tier 1 products. These include Swaddlers, Pampers Pure, Cruisers 360 (“ a very unique proposition in the pant form for active babies”) and Ninjamas (“a bed-wetting product [in] which we reentered the category, created significant growth, and built a 9% share.”)
Other specific brands highlighted in the P&G earnings call included:
-- SK-II cosmetics, the Japanese-based luxury skin-care brand, which has seen soft sales. Moeller explained that’s because it’s “typically been a counseled product” in both department stores and travel retail, “meaning there’s a knowledgeable person in the store to help you understand the benefits of the product and which elements are right for you.” But, due to COVID, retail largely closed in many parts of Asia.
-- Oral B, whose $299 toothbrush has been negatively impacted by chip shortages, with “consumer demand higher than anything we can deliver,” per Schulten.
One of P&G’s future goals, Moeller noted, is to better serve two demographics -- Gen Z and multicultural consumers -- a goal made easier because “Gen Z is multicultural by definition.”