P&G raises full-year forecast after beauty, healthcare brands drive profit beat

(Reuters) – Procter & Gamble Co (N:) on Tuesday raised its full-year sales and profit forecasts after a better-than-expected first quarter, powered by demand for its premium beauty and toothpaste brands.

Shares of the world’s biggest personal care goods company rose 4.4% in premarket trading.

P&G, which makes Tide detergent and Pantene shampoo, has been raising prices and investing in new products across most of its business, hoping to claw back market share from upstart brands that have cropped up in recent years.

P&G forecast full-year core earnings growth in the range of 5% to 10%, compared with its prior estimate of 4% to 9% growth. The company expects full-year sales to grow as much as 5%, compared with earlier expectation of 4%. P&G retained its lower-end sales growth forecast of 3%.

Organic sales, which exclude acquisitions, divestitures and currency effects, rose 7% in the company’s fiscal first quarter, ended Sept. 30.

P&G said organic sales rose 10% in its beauty business, which makes SK-II and Olay products. The company, which launched its Oral-B Genius X electric toothbrush and Crest toothpaste aimed at people with sensitive teeth and gum, said organic sales rose 9% at its healthcare business.

Organic sales in the grooming unit, a sore point for the company, reported 1% growth. It took an $8 billion writedown for its Gillette shaving business in the fourth quarter.

Overall, net sales climbed 6.6% to $17.80 billion, beating analysts’ average estimate of $17.42 billion, according to IBES data from Refinitiv.

Net income attributable to the company rose to $3.59 billion, or $1.36 per share, in the three months, from $3.20 billion, or $1.22 per share, a year earlier. Excluding items, P&G earned $1.37 per share, beating estimates of $1.24.

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