Procter & Gamble (P&G) on Friday, Oct. 18, reported slightly lower sales and lower profits for the first quarter of its staggered 2025 fiscal year. The company said China’s recovery will still take several quarters.
Procter & Gamble, which makes products such as Tide detergent, Crest toothpaste, Head & Shoulders and Pantene shampoo, reported mixed sales across its five product categories, with health care seeing the most growth and beauty the most declining.
Sales decreased 1% to $21.7 billion. Profits fell 12% year-on-year to $4 billion, partly due to one-time restructuring costs of about $1.2 billion associated with the liquidation of assets in Argentina and Nigeria.
Beauty sales fell due to lower volumes in Greater China, where the super-premium SK-II skincare brand has been weak for several quarters.
“Our organic sales, earnings and cash performance in the first quarter showed that we are within guidance on all key financial metrics for the fiscal year,” said John Mueller, Chairman, President and CEO. We are on track to achieve this.”
China’s recovery ‘will take time’
Chief Financial Officer Andre Schulten said the company welcomed the Chinese government’s recent stimulus package, but did not expect a rapid recovery in the Chinese economy.
“What I can say at this point is that we are still in a slump. We think it will take several quarters to get back to positive growth,” Schulten said in a call with reporters. He said China’s recovery “will take time.”
By contrast, Schulten said U.S. consumer products were “very strong,” with P&G seeing about 4% growth in the category.
“Consumers continue to favor P&G, and we don’t see any decline in trading prices,” he said.
P&G has confirmed that its sales for fiscal 2025 are expected to increase by 2% to 4% compared to the previous year. “The combination of headwinds from foreign exchange and stock sales is expected to have a negative impact of approximately 1 percentage point on all-in sales growth,” the company said.
Shares fell 0.6% in pre-market trading.
