Procter & Gamble’s fiscal second-quarter earnings and sales, reported on Wednesday, beat the Wall Street estimates, which also prompted the company to raise forecast of its organic sales.
Prices rose by the consumer products giant amid higher transportation and commodity costs has now been paying off, to which company said that in the quarter about 1 percent of its organic sales came from the hiked prices.
Beating results surged the company’s share by more than 4.7 percent in premarket trading on Wednesday.
To the gains, contribution came from the company’s segments of health care, beauty products and fabric and home care businesses.
In the fiscal second-quarter of 2019, P&G’s after adjustments per share earnings of $1.25 surpassed $1.21 expected by analysts surveyed by Refinitiv for the same. Also the revenue of $17.44 billion remained up from $17.15 billion estimates.
Net income for the fiscal second-quarter rose to $3.19 billion or $1.22 per share from $2.5 billion or 93 cents per share in the same quarter a year ago.
Higher prices as well as strong demand for its Olay skin care products and super-premium SK-II brand drove the organic sales of P&G’s beauty care business, during the reported period and on year-on-year basis, to grow by 8 percent.
Organic sales in its heath care division rose 5 percent while that rose 6 percent in company’s fabric and home care business during the fiscal second-quarter.
The grooming business of the company, which includes its Gillette brand, remained struggling in the reported quarter but due to volume decline during the quarter in shave care business, the segment came with a fall of 3 percent in organic sales.
P&G has a market value of $225.3 billion and is planning to buy back stocks of worth $5 billion in the fiscal year 2019.
Announced in November, company is also reorganizing its operational structure, with a separate unit CEO of each of its six units, who will be responsible for all major decision within their units.