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File – File on Thursday, July 9, 2015 In the photo, you can see the Procter & Gamble headquarters complex in downtown Cincinnati. Proctor & Gamble is raising the prices of a variety of commodities as soaring commodities and fares are set to eat up profits. Manufacturers of Pampers diapers, tide detergents and crest toothpaste said on Tuesday, October 19, 2021, they were raising prices for product lines such as baby, family, home and fabric care. (AP photo / John Minchiro, file)
New York (AP) — Proctor & Gamble is raising prices for a variety of commodities as soaring commodities and fares are set to eat up profits.
Manufacturers of Pampers diapers, tide detergents and crest toothpaste said they are raising prices on product lines such as babies, families, homes and fabric care on Tuesday. In the past few weeks, we have begun telling retailers that we will raise prices in more categories such as grooming, skin care and oral care.
“The degree and timing of these moves is very specific to the category, brand, and sometimes the product form within the brand,” Chief Financial Officer Andre Schulten said on the phone to discuss quarterly results. “This is not a one-size-fits-all approach.”
He said he hasn’t seen any “significant changes” in consumer behavior in response to rising prices, albeit at an early stage.
According to Schulten, the Cincinnati company is currently forecasting a $ 2.1 billion product hit in fiscal year 2022. This is up from an estimated $ 1.8 billion in July.
P & G also expects higher transportation costs, partly due to a shortage of truck drivers and rising diesel fuel costs. The company estimates in July that it will cost an additional $ 100 million this year. On Tuesday, consumer goods makers doubled their quote to $ 200 million.
In total, a $ 2.3 billion increase in costs will reduce revenue in fiscal 2022 by approximately 90 cents per share.
Last week, the Ministry of Labor reported that wholesale prices in September rose 8.6%, a record high compared to a year ago. This is the largest increase since the 12-month change was first calculated in 2010. This year’s surge in inflation reflects rising food and energy prices. Wholesale-level core inflation, excluding volatile energy and food, rose 0.2% from August to September, rising 6.8% over the last 12 months.
Meanwhile, retail-level inflation rose 0.4% in September and the consumer price index rose 5.4% in the last 12 months, consistent with the fastest pace since 2008, according to government data.
P & G maintains its annual guidance and does not expect inflation to continue, calling it a “rough patch of temporary earnings.”
“If the opportunity allows, we’ll end a few price increases with new product innovations and add value to consumers in the process,” Schulten said.
P & G raises prices to offset rising commodity and freight rates | WGN Radio 720
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