Summary
Procter & Gamble (PG) reported solid results for the third quarter and the first nine months of fiscal year 2022, demonstrating resilience in a challenging economic environment. Net sales for the quarter grew 7% to $19.4 billion, driven by a combination of higher pricing (5%), positive product mix (2%), and a 3% increase in unit volume, partially offset by a 3% negative impact from foreign exchange. The company saw broad-based strength across its segments, with Health Care, Fabric & Home Care, and Baby, Feminine & Family Care showing particularly strong performance. Despite significant headwinds from rising commodity and transportation costs, which impacted gross margins, P&G managed to increase net earnings attributable to the company by 3% to $3.4 billion for the quarter and $11.7 billion for the nine-month period. Diluted Earnings Per Share (EPS) also saw a healthy increase of 6% for the quarter and 5% for the nine-month period, aided by share repurchases. The company generated strong operating cash flow of $13.0 billion for the nine months and maintained high free cash flow productivity of 92%, underscoring its financial health and ability to return value to shareholders.
Financial Highlights
53 data points| Revenue | $19.38B |
| Cost of Revenue | $10.33B |
| Gross Profit | $9.05B |
| SG&A Expenses | $5.03B |
| Operating Income | $4.02B |
| Interest Expense | $109.00M |
| Net Income | $3.35B |
| EPS (Basic) | $1.37 |
| EPS (Diluted) | $1.33 |
| Shares Outstanding (Basic) | 2.40B |
| Shares Outstanding (Diluted) | 2.53B |
Key Highlights
- 1Net sales increased by 7% to $19.4 billion for the third quarter, driven by a 5% increase in pricing and a 2% positive mix, with unit volume contributing 3% growth.
- 2Net earnings attributable to Procter & Gamble increased by 3% to $3.4 billion for the third quarter, demonstrating effective cost management amidst inflationary pressures.
- 3Diluted EPS grew by 6% to $1.33 for the third quarter, supported by higher net earnings and a reduction in weighted average shares outstanding.
- 4For the nine-month period, net sales rose 6% to $60.7 billion, with organic sales up 7%, excluding the impact of foreign exchange and portfolio changes.
- 5Gross margin declined by 400 basis points to 46.7% in the quarter, primarily due to a 410 basis-point increase in commodity costs.
- 6The company generated strong operating cash flow of $13.0 billion for the nine months ended March 31, 2022, with adjusted free cash flow productivity at 92%.
- 7Significant cost pressures from commodities and transportation impacted profitability, but were partially mitigated by pricing actions and productivity savings.