ii view: P&G on track in challenging times

First-quarter results to 30 September

• Net sales up 3% to $22.4 billion
• Core earnings per share (EPS) up 3% to $1.99
• Quarterly dividend unchanged from Q4 at $1.0568 per share

Guidance:

• Continues to expect adjusted or organic full-year 2026 sales growth of between flat and up 4%
• Continues to expect adjusted or core earnings per share growth of between flat and up 4%

Chief executive Jon Moeller said:

“These results keep us on track to deliver within our guidance ranges on all key financial metrics for the fiscal year in a challenging consumer and geopolitical environment.”

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ii round-up:

Consumer goods giant Procter & Gamble Co (NYSE:PG) maintained hopes for growth in sales and earnings over the current financial year while also flagging a challenging consumer and geopolitical environment.

Under relatively new head Jon Moeller, sales for the first quarter to late September improved 3% to $22.4 billion, pushing core earnings up by the same amount to $1.99 per share. Wall Street had forecast outcomes of $22.2 billion and $1.91 per share respectively. 

Shares in the Dow Jones company rose 1% in US trading having come into these latest results down around a tenth so far in 2025. That’s similar to rival US consumer goods makers Colgate-Palmolive Co (NYSE:CL) and Kimberly-Clark Corp (NASDAQ:KMB). The Dow Jones index is up 10% year-to-date. 

PG brands include Ariel, Fairy, Crest toothpaste and Always. Volume gains of 4% and 1% respectively for Beauty and Grooming products sat alongside volumes retreats of 2% for both Healthcare and Fabric and Home care items. 

Increased demand for Beauty products and including hair care, largely in North American, offset falls for Fabric and Home Care products such Ariel, mainly in Europe.   

Price rises of up to 4% for Grooming products under brands such as Gillette and Braun helped fuel the overall gain in quarterly revenues. 

P&G continues to predict growth of up to 4% in both adjusted sales and core earnings over the current financial year to late June 2026  

A quarterly dividend payment of $1.0568 per share is unchanged from the prior quarter. P&G returned over $16 billion to shareholders during its last financial year via $9.9 billion in dividend payments and $6.5 billion of share repurchases.  

Second-quarter results are likely to be announced mid-to-late January. 

ii view:

Headquartered in Cincinnati, Ohio, P&G employs more than 105,000 people across 70 countries. Fabric and Home Care generated most profits during its last financial year to late June at 35%. That was followed by Baby, Feminine & Family Care at 24%, Beauty at 16%, Healthcare 15%, and Grooming 10%.  Other brands include Tide, Febreze, Pantene, Pampers, and Tampax.

Geographically, North America makes most sales at 52%. Then comes Europe at 22%, Asia Pacific, China and Latin America all at 7%, and India, the Middle East and Africa 5%. Global competitors include Unilever (LSE:ULVR) and L'Oreal SA (EURONEXT:OR). 

For investors, a period of rising prices pressuring disposable consumer income may continue to see shoppers seek cheaper supermarket own-branded alternatives. Volatility in raw material costs given ongoing global trade and geopolitical tensions should not be forgotten. Sizeable sales overseas leave currency moves a feature, while the impact of product chemicals and packaging on the environment continues to warrant consideration.

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More favourably, P&G’s long list of household goods feature regularly for shoppers across the globe. Management initiatives to sharpen productivity and reduce costs are ongoing. Geographical diversity should help positives for one region counter challenges in another, while more than 65 years of consecutive annual dividend increases leaves the shares on a forecast dividend yield of around 2.8%.

On balance, and despite ongoing risks, this consumer goods mammoth continues to justify its place in many already diversified long-term investment portfolios.   

Positives: 

• Product and geographical diversity
• Progressive dividend policy

Negatives:

• Uncertain economic outlook
• Currency movements can hinder performance

The average rating of stock market analysts:

Buy