Procter & Gamble has raised its full-year sales forecast on the back of increased prices, even as it warned of high commodity costs pressuring profits.
P&G, like other consumer goods companies, has implemented multiple price increases over the last few months to cover soaring transportation, commodity and labour costs, as well as the impact of a stronger US dollar on its overseas revenue.
While the price hikes have been met with less pushback compared to those in discretionary products that customers have largely shunned, sales volumes for P&G have still dipped. The company reported a 6% fall in second-quarter overall volumes.
The company said it expects fiscal 2023 total sales to range between flat and a 1% drop, compared with its previous forecast of a 1% to 3% fall, but maintained its annual earnings forecast of flat to up 4%, citing elevated commodity costs.
Jon Moeller, chairman of the board, president and chief executive officer, said, "Progress against our plan fiscal year to date enables us to raise our sales growth outlook for fiscal 2023 and maintain our guidance range for EPS growth despite significant headwinds."
The company's shares fell about 1% to $143.93 in premarket trading.
P&G said net sales fell 1% to $20.77 billion in the reported quarter, compared with analysts' average estimate of $20.73 billion, according to IBES data from Refinitiv.
The company's earnings per share of $1.59 was in line with analysts' average estimate.