Procter & Gamble disappointed Wall Street by reporting fiscal first-quarter organic sales growth of 5% today, below that of key competitors that reported so far. The company also announced price
increases--mostly driven by higher commodity costs--including a 5%-12% hike on Olay and Ivory cleansing products and a 5%-8% increase on Pampers diapers.
P&G's beauty business, with
organic sales growth of 4%, dragged down overall company results. Olay, long a major driver of P&G's skin-care growth, slowed to mid-single digits last quarter, though Chairman-CEO A.G. Lafley
promises new product initiatives for the Regenerist and Definity lineups by early next year.
On the bright side, coffee and snacks businesses had organic sales growth of double digits behind product launches that included Dunkin Donuts supermarket coffee in the U.S. and Pringles Rice Infusion in Europe. P&G's marketing spending--which has been a subject of scrutiny as the company's organic sales growth has slowed the past two years and the company redefined it--was up as a percent of sales, though Lafley would not say by how much.