P&G delivers fourth quarter organic sales up 4 %

The Procter & Gamble Company reported fiscal year 2013 and fourth quarter results. Net sales increased 2 % to $20.7 billion in the April – June quarter, including unfavourable foreign exchange of two percentage points. Organic sales grew 4 %, including a unit volume increase of 5 %. Geographic and category mix reduced net sales by one percentage point, while pricing was unchanged versus the prior year. Net sales increased 1 % to $84.2 billion for fiscal year 2013. Unit volume growth contributed two percent to sales growth, and pricing added one percent. Organic sales increased 3 %, with all segments growing organic sales.

“The company met its objectives for the fourth quarter and fiscal year, and we will build on these results in fiscal 2014,” said Chairman, President and Chief Executive Officer, A.G. Lafley. “With an overriding focus on value creation, we will strengthen and accelerate productivity plans. We will continue to make conceived investments in core brands, our biggest innovation opportunities, and in our core developed and most promising developing markets. In all we do, we will stay focused on winning with consumers, customers and shareholders.”

Fiscal Year 2014 Guidance

For fiscal year 2014, P&G expects organic sales growth in the range of 3 to 4 % compared to underlying global market growth of about 3.5 %, the company stated. All-in sales growth is forecast in the range of 1 % to 2 %, including a negative foreign exchange impact of approximately 2 %.

Beauty segment

Beauty segment net sales increased 1 % driven by a 4 % increase in unit volume, partially offset by a negative two percentage point impact from foreign exchange and one percentage point of unfavourable product mix, the company informed. Sales were down in hair care, as volume growth was more than offset by pricing adjustments to improve consumer value and unfavourable foreign exchange. In the personal beauty categories, sales were up high single digits behind strong, innovation-driven growth in personal cleansing products, cosmetics and deodorants. Sales were down versus prior year in skin care due to high levels of competitive promotional activity. Prestige sales grew mid-single digits driven by new innovation. Beauty segment net earnings growth drivers were a lower effective tax rate and lower SG&A costs, partially offset by a lower gross margin.