Procter & Gamble raised its fiscal 2027 net-sales growth forecast after first-quarter net sales rose 4%, citing its Thorne acquisition while leaving its organic-sales target unchanged.
The fiscal first quarter ended Sept. 30. Net sales rose 4% year over year to $23.3 billion, while the cost of products sold climbed 7% to $11.7 billion, according to P&G’s Oct. 22 earnings release, furnished as Exhibit 99.1 to its Form 8-K filed with the U.S. Securities and Exchange Commission (SEC).
Diluted earnings per share advanced 1% to $1.97, and core earnings per share rose 1% to $2.00. Reported operating margin declined to 25.5% from 26.2% a year earlier. After excluding foreign-exchange and acquisition or divestiture effects, organic sales increased 4%.
P&G said reported gross margin narrowed by 160 basis points, partly because of higher commodity costs, product reinvestments and an unfavorable mix. Productivity savings, tariff effects and pricing partly offset those pressures. The cost of products sold grew faster than sales in the quarter, while reported operating margin was lower year over year.
The company raised its fiscal 2027 net-sales growth forecast to 2% to 4%, citing the Thorne acquisition as of Oct. 1. Its earlier forecast put net-sales and organic-sales growth in the 1% to 3% range, as outlined in an earlier fiscal 2027 outlook. P&G kept its organic-sales range at 1% to 3%, so its higher reported-sales range incorporates the acquisition while the organic target stays unchanged.
Core earnings per share are still expected to range from $6.89 to $7.11, equivalent to growth ranging from flat to 3%. Chairman of the Board, President and Chief Executive Officer Shailesh Jejurikar said, “This strong start keeps us on track,” referring to the company’s full-year guidance. P&G expects to pay more than $10 billion in dividends and repurchase about $5 billion in shares in fiscal 2027. Shareowners received $3.9 billion through dividends and repurchases during the quarter.
