Proctor & Gamble (PG) reported its strongest annual growth since 2006 on Thursday, with fiscal fourth quarter earnings rising to more than $2.8 billion or $1.10 a share compared with a $5.2 billion loss in the comparable quarter last year. The positive results were spurred by demand for household cleaners and toilet paper as a result of the coronavirus pandemic.

The Cincinnati-headquartered company is known for producing Tide laundry detergent, Charmin toilet paper and many other household products.

“On the whole, with health, hygiene and cleaning, consumers’ needs have changed forever,” Chief Financial Officer Jon Moeller said. “Maybe not to the degree that’s happened recently. But it’s hard to imagine we’ll snap back to the old world.”

The company reported that net sales were up 5% or nearly $71 billion for the fiscal year, which ended June 30. Its fabric and home care unit, unsurprisingly, was the most successful, posting 14% sales growth, the company reported. That division is responsible for Tide, Mr. Clean, Dawn and Cascade.

Net sales for the fourth quarter totaled nearly $17.7 billion, up from $17 billion in 2019's fourth quarter. For the year, 2020 sales totaled $70.95 billion compared to $67.68 billion in 2019.

The reopening of business in China was also highlighted as a reason for the P&G’s strong sales as the country is its second-biggest market.

Moving forward, P&G has set a more modest 2% to 4% growth forecast for the current fiscal year, claiming the ongoing economic fallout created by the coronavirus pandemic has made the market uncertain. Despite this trepidation, the company has shown little sign of negative impact from the pandemic, with customers seemingly willing to pay premium prices for its home hygiene products while public health remains a paramount concern.

“We expect that if this gets longer and deeper, people will have to make choices,” CEO David Taylor said. “The good news is that, unlike last time, we have a broader portfolio.”

Proctor & Gamble was trading around $131 per share on Thursday afternoon, an over 2% increase since closing at $128.31 on Wednesday.

P&G shares were up 2.3% at $131.29 shortly before the close.

person-in-glove-spraying-detergent-at-walk-in-shower-glass-4239101
Surface disinfectant cleaners are an effective means to protect yourself from COVID-19. Pexels
RELATED STORIES
Coronavirus China