On July 30th, 2021 Procter & Gamble reported 4th quarter & fiscal year-end 2021 earnings results (see press release here).
For the quarter, the company reported 7% top line revenue growth to $18.9 Billion versus last year. Diluted earnings per share (EPS) in Q4 was $1.13 vs. a $1.08 consensus estimate.
Overall ‘organic’ revenue increased 4% versus the same quarter last year. The company saw positive organic revenue gains in all but one segment.
P&G’s Health Care segment led with organic revenues up 14%, driven primarily by 13% volume growth in the quarter. Baby, Feminine & Family Care, posted a -1% organic sales decline mostly due to moderating volumes vs. heavy pandemic spending in the base quarter.
Net pricing increased 1% in Q4. According to a CNBC report, P&G plans to raise prices more this September (here). The company is looking for ways to offset an expected $1.9 billion ($0.70 per share) after-tax headwind next year from to higher commodity, transportation, and exchange costs.
In the 2021 fiscal year, P&G grew revenues to $76.1 billion, up 7% from the year prior. Diluted ‘core’ EPS was up 11% from 2020 to $5.50 per share. The company paid $8.3 billion in dividends and made $11.0 billion worth of share repurchases.
P&G set its fiscal 2022 “all-in” sales growth forecast to a range of 2% to 4% versus fiscal 2021. The company expects 2022 bottom line ‘core’ EPS to grow between 3%-6% vs. 2021’s $5.50 per share.
These estimates would put P&G’s full year ‘core’ earnings per share in a range of $5.67 to $5.83 for fiscal 2022. Applying 2022 guidance to P&G’s July 30th, 2021, closing price ($142.23) places their forward price/earnings valuations between 24.4 and 25.1 times earnings.
In all, both Q4 and FY 2021 earnings beat consensus forecasts, forward guidance remains strong, and expectations remain high. P&G’s price-earnings valuation continues to trend near the high-end of its range over the past decade (14.6x in 2011 and 25.7x in 2019).