American multinational consumer goods firm Procter & Gamble (P&G) has reported a 4 per cent increase in net sales to $20.8 billion in the third quarter (Q3) of fiscal 2023 (FY23), compared to the previous year. The company's organic sales, which exclude the impact of foreign exchange and acquisitions and divestitures, increased by 7 per cent.

Diluted net earnings per share in Q3 FY23 were $1.37, a 3 per cent increase from the prior year. The increase in diluted net earnings per share was driven by an increase in net sales, operating margin, and a reduction in shares outstanding. Operating cash flow was reported at $3.9 billion, and net earnings at $3.4 billion for the quarter. Currency-neutral EPS were up 13 per cent versus the prior year EPS, the company said in a press release.

P&G's gross margin for the quarter increased by 150 basis points compared to the previous year, and 220 basis points on a currency-neutral basis. However, the selling, general, and administrative expense as a percentage of sales increased by 100 basis points compared to the previous year, and 50 basis points on a currency-neutral basis.

The operating margin for the quarter increased by 40 basis points versus the prior year, and 160 basis points on a currency-neutral basis. The operating margin included gross productivity savings of 290 basis points.

The baby, feminine and family care segment’s organic sales increased by 6 per cent compared to the previous year. Baby care organic sales increased mid-single digits due to increased pricing, while feminine care organic sales increased low teens due to increased pricing and favourable geographic and product mix. Family care organic sales increased low single digits due to increased pricing.

For fiscal 2023, the company expects all-in sales to grow approximately one per cent versus the prior fiscal, from a prior guidance range of down 1 per cent to in-line. The company also raised its outlook for organic sales growth to approximately six per cent versus the prior fiscal from a prior growth range of 4-5 per cent.

P&G maintained its outlook for fiscal 2023 diluted net earnings per share growth in the range of in-line to up 4 per cent versus its fiscal 2022 EPS of $5.81. The company expects EPS results towards the lower end of the fiscal guidance range, the release added.

“We delivered strong results in the third quarter of fiscal 2023 in what continues to be a very difficult cost and operating environment,” said Jon Moeller, chairman of the board, president and chief executive officer. “Our team’s strong execution of our strategies and our progress through three quarters enable us to raise our fiscal outlook for sales growth and cash return to shareowners and maintain our guidance range for EPS growth despite continued cost and foreign exchange headwinds. We remain committed to our integrated strategies of a focused product portfolio of daily use categories where performance drives brand choice, superiority, productivity, constructive disruption, and an agile and accountable organisation structure. These strategies have enabled us to build and sustain strong momentum, and we’re confident they remain the right strategies to deliver balanced growth and value creation going forward.”