Procter & Gamble’s revenues and profits beat quarterly estimates this week due to improved sales in the US and China, its two largest markets.
Net sales rose 2% to $21.9bn in the three months to 31 December, the biggest increase in three quarters. Most of the growth came from higher volumes with prices relatively unchanged compared with the same period a year ago.
P&G’s sales in North America grew 4% while in China sales fell just 3%, compared with a 15% decline last quarter. While a significant improvement, CFO Andre Schulten told analysts he still does not believe China is out of the woods. “This will continue to be difficult. This will continue to be volatile,” he said.
P&G said innovation helped drive growth in its grooming business, which grew 2% after the company launched new products at a higher price point.
Only P&G’s beauty division saw volumes decline in the quarter, down by 1%. Its skincare segment, including Olay products, saw global volume decrease while its haircare products took a hit in China.
The company reiterated its guidance for sales and profit in the financial year, which runs till the end of June.
“We believe P&G remains one of the best-positioned CPG [consumer packaged goods] companies to deal with the volatility that has come to define the past few years and most likely the next few years,” said RBC analyst Nik Modi in a research note.
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