Consumer goods giant Procter & Gamble Co raised its full-year sales forecast on Friday, signalling higher prices would offset the hit from consumers turning to cheaper, private-label alternatives for tissues and other household essentials.
The Tide detergent maker's shares rose 1% in premarket trading.
P&G also said its expects annual earnings per share towards the lower end of the fiscal year guidance range.
Products made by companies such as P&G and Unilever are usually among the last to see a slowdown in demand during economic downturns, unlike discretionary items including appliances and furniture.
A Series Of Price Hikes
Demand has also managed to hold up against a series of price hikes by these companies to pass on steep input costs that stemmed from supply-chain snags and were worsened by the Ukraine crisis in 2022.
The Pantene shampoo maker reported a 3% fall in overall volumes in the third quarter, with average prices across its product categories rising 10%.
The company said it expects fiscal 2023 organic sales growth of about 6%, compared with its previous forecast for a 4% to 5% increase.
Jon Moeller, chairman of the board, president and chief executive officer of Procter & Gamble said, "Our team’s strong execution of our strategies and our progress through three quarters enable us to raise our fiscal year outlook for sales growth and cash return to shareowners and maintain our guidance range for EPS growth despite continued cost and foreign exchange headwinds."
Quarterly Highlights
Net sales in the third quarter increased by 4% year-on-year to $20.1 billion (€18.3 billion), with organic sales in the beauty segment increasing by 7%.
The skin and personal care segments saw organic sales growth in low single digits as higher pricing and innovation-based volume growth were partially offset by lower sales of SK-II in the travel retail channel.
The grooming division also witnesses a 7% year-on-year growth during the third quarter, while the health care segment registered 9% organic growth.
The fabric and home care division saw organic sales growth of 9%, while the baby, feminine and family care segment reported 6% organic sales growth.
Read More: Procter & Gamble Dialling Up Discounts As US Consumers Pull Back
