Procter & Gamble Co (PG, Financial) released its Q1 FY2024 earnings report on October 18, 2023, revealing a strong start to the fiscal year. The company reported net sales of $21.9 billion, marking a 6% increase compared to the same period last year. Organic sales, which exclude the impacts of foreign exchange and acquisitions and divestitures, increased by 7%. Diluted net earnings per share were $1.83, a 17% increase year-over-year.
Financial Highlights
The company's operating cash flow for the quarter was $4.9 billion, and net earnings were $4.6 billion. Procter & Gamble Co (PG, Financial) returned $3.8 billion of cash to shareholders through approximately $2.3 billion of dividend payments and $1.5 billion of common stock repurchases.
The company's financial tables reveal that GAAP net sales for 2024 were $21.9 billion, a 6% increase from 2023. Diluted EPS and Core EPS both stood at $1.83, marking a 17% increase from the previous year.
Company Commentary
“We delivered very strong results in the first quarter of fiscal year 2024, putting us on track to deliver towards the higher end of our fiscal year guidance ranges for organic sales and core EPS growth,” said Jon Moeller, Chairman of the Board, President and Chief Executive Officer.
Performance Analysis
Procter & Gamble Co (PG, Financial) reported a 7% increase in organic sales, driven by a 7% increase from higher pricing and a 1% increase due to favorable product mix. However, this was partially offset by a 1% decrease in shipment volumes. The company's Beauty segment saw a 5% increase in organic sales, while the Grooming segment saw a 9% increase. The Health Care segment reported a 10% increase in organic sales, while the Fabric and Home Care segment saw a 9% increase. The Baby, Feminine and Family Care segment reported a 7% increase in organic sales.
FY2024 Guidance
Procter & Gamble Co (PG, Financial) adjusted its guidance range for fiscal 2024 all-in sales growth to be in the range of two to four percent versus the prior year. The company maintained its outlook for organic sales growth in the range of four to five percent. It also maintained its fiscal 2024 diluted net earnings per share growth in the range of six to nine percent versus fiscal 2023 EPS of $5.90.
The company expects tailwinds of approximately $800 million after tax due to favorable commodity costs for fiscal year 2024. However, unfavorable foreign exchange rates are now expected to be a headwind of approximately $1 billion after tax.
Procter & Gamble Co (PG, Financial) continues to expect adjusted free cash flow productivity of 90% and expects to pay more than $9 billion in dividends and to repurchase $5 to $6 billion of common shares in fiscal 2024.
