Detail view of rolls of Charmin toilet paper in a domestic home, San Ramon, California, March 25, 2020.
Smith Collection | Gado | Getty Images
Procter & Gamble reported that its fiscal third-quarter U.S. sales surged 10% as consumers stocked up on staples like Charmin toilet paper and Bounty paper towels ahead of the coronavirus outbreak.
But the Pampers owner cut its revenue forecast for fiscal 2020, citing headwinds from foreign currency.
Shares of the company rose less than 1% in premarket trading. The stock, which has a market value of $305 billion, has fallen 1% so far in 2020.
Here’s how Procter & Gamble did for the quarter ended March 31:
- Earnings per share: $1.17, adjusted
- Revenue: $17.21 billion
P&G reported fiscal third-quarter net income of $2.92 billion, or $1.12 per share, up from $2.75 million, or $1.04 per share, a year earlier. Excluding items, the Tide owner earned $1.17 per share.
Net sales rose 5% to $17.21 billion. Organic revenue, which strips out the impact of foreign currency, divestitures and acquisitions, rose 6% during the quarter.
Organic sales for P&G’s fabric and home care segment, which includes brands like Tide and Ariel, rose 10% in the quarter.
Its baby, feminine and family care business saw organic sales rise 7%, even though demand for its baby products weakened in China, its second-largest market. Retail sales disruptions in China hurt its beauty segment, with its sales of its pricey SK-II skincare line declining by double digits.
In mid-February, the company warned that its third-quarter profits and revenue would take a hit as the Covid-19 outbreak caused supply chain interruptions and weaker demand in China.
P&G’s grooming business, which includes Gillette and Venus, was the only segment to report shrinking organic sales.
Wall Street anticipated earnings per share of $1.13 on revenue of $17.46 billion, based on a survey of analysts by Refinitiv. However, it’s difficult to compare reported earnings to analyst estimates for P&G’s quarter, as the coronavirus pandemic continues to hit global economies and makes earnings impact difficult to assess.
P&G maintained its outlook for organic sales growth for the fiscal year, but revenue will be lower than expected due to the impact of foreign exchange. It now predicts fiscal 2020 sales will rise 3% to 4%, down from a prior range of 4% to 5% growth.
The company also backed its prior fiscal 2020 earnings forecast, which calls for growth of 235% to 245% on a per-share basis, due to impairment charges from the Gillette Shave business in 2019. Excluding items, adjusted earnings per share will be up 8% to 11%, P&G said.
Even as other firms are slashing or suspending their dividends, P&G announced on Tuesday that it would be raising its quarterly dividend by 6%.