Procter & Gamble says prices for Tide laundry products and personal care items will soon rise

The cost of laundry detergent will rise, according to Procter & Gamble Co., which announced additional price increases Wednesday along with its fiscal second-quarter results.

“In mid-December, we announced to retailers that effective February 28, we are increasing prices on the rest of our Fabric Care portfolio, which includes Tide, Gain, Downy, Bounce and Unstopables and includes all shapes , liquids and unit doses. detergents, scent beads, liquid fabric softeners and dryer sheets,” said Andre Schulten, PG of P&G,
chief financial officer during the earnings call, according to a FactSet transcript.

The company has raised prices for “intermediate” liquid and powder detergents in recent months, Schulten said.

“We have now announced price increases in each of our 10 U.S. product categories, increases in Baby Care, Feminine Care, Adult Incontinence, Family Care, Home Care, hair, oral care and skin care are now mainstream in the market,” he said.

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Other brands in P&G’s portfolio include Pantene hair care products, Crest toothpaste and oral care items, Charmin toilet paper and the Vicks brand of cough, cold and flu products.

Prices for personal health care products will rise in the United States in mid-April. Vicks, Pepto Bismol and Metamucil fall into this category.

“As we have said before, we believe this is a difficult temporary growth period, not a reason to reduce investment in the business. We stick to the strategy that worked well before and during the COVID crisis,” Schulten said.

Read: Is Fido capricious? Pet food is impacted by supply chain disruptions

Like many other companies, P&G has seen transportation, material, labor and other costs rise during the pandemic. Inflation is also taking its toll.

“The recent spike in virus cases and resulting lockdowns increase the risk of additional work stoppages to our operations or those of our suppliers,” Schulten said.

“Based on current spot prices, we now estimate a $2.3 billion after-tax headwind to the cost of raw materials for fiscal year 2022. Since our last update, we have seen continued increases diesel and chemicals with little compensation in other materials Freight costs have continued to rise We now expect freight and transportation costs to be an additional $300 million headwind after tax for fiscal year 2022.”

General Mills Inc. GIS,
discussed price increases, and companies like McCormick & Co. MKC,
and Freshpet Inc. FRPT,
talked about the disruptions in production caused by the pandemic.

To see: Cheerios parent company General Mills expects supply chain disruptions to further impact prices

P&G reported better-than-expected sales and earnings on Wednesday and tightened its sales forecast for the year.

“We maintain a buy rating, viewing PG’s better supply chain and dominant pricing power as significant competitive advantages in this challenging operating environment,” CFRA’s Arun Sundaram wrote in a post-earnings memo. .

CFRA raised its 12-month price target by $2 to $178.

“Consistently strong execution, along with a product portfolio focused on everyday use items and a growth strategy focused on innovation, should equate to strong and reliable long-term results.”

Credit Suisse maintained its neutral rating and $145 price target, noting the hurdles the company may soon face.

“While elasticities have been better so far than in the past, volume growth should moderate from here as more pricing takes effect,” the analysts wrote.

“[S]the timulus decreases, mobility resumes and consumption expenditure could shift towards services (and not towards goods). Thus, we see greater uncertainty around the consumer and, therefore, the sustainability of revenue growth. We also note that the Chinese economy is slowing and Procter’s sales are flat this fiscal year.

P&G stock rose 3.4% on Wednesday and has gained 23.2% over the past 12 months. The Dow Jones Industrial Average DJIA,
increased by 12.1% over the past year.

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