People are no longer stocking up on household products like they did in the early days of the coronavirus pandemic, but Procter & Gamble chief executive officer David Taylor told TBEN on Tuesday that the company expects it to be. that increased demand for certain categories remains.
“They don’t do hoarding anymore. In a lot of cases, they’re working on the inventory they’ve built in their homes,” Taylor said in an interview broadcast on “Closing Bell.” “But I think consumers are recognizing that there is still a lot of variability to come in what could happen, so they’re going to maintain a bit more than they did before the pandemic.”
Specifically, Taylor said that P&G – owner of brands such as Mr. Clean, Microban 24 and Crest – expected people to continue to focus more on cleaning and hygiene, providing a favorable wind for the consumer goods giant. .
“I think we’ve all adopted cleaning habits. We’re used to making the house a bigger part of our lives, ”said Taylor, who has led P&G in Cincinnati since 2015.“ In many ways, these habits will likely continue for… an extended period after the pandemic, and that bodes well for many of the categories in which we compete. “
P&G was seen as the type of company that would profit from the pandemic, with TBEN’s Jim Cramer including his shares in his Covid index, for example. But investors have questioned the sustainability of any increase in Covid-related sales, particularly as a wider range of economic activity picks up and more immediate virus problems fade away.
P&G shares are down more than 10% from their 52-week high of $ 146.92 on November 9. For comparison, the benchmark S&P 500 is up just over 9% in the same time frame.
Taylor said it would be “interesting” to see how consumer spending is recalibrated, but that he believes “health, cleaning and hygiene will remain strong after the pandemic.”
Taylor isn’t alone in predicting that altered attitudes to cleanliness will continue. Linda Rendle, the chief executive of Clorox, offered a similar perspective in an interview with TBEN on Friday. “People are embracing cleaning as more about safety and well-being, not just a chore,” said Rendle.
Clorox raised its full-year sales outlook following its quarterly earnings report earlier this month, forecasting revenue growth of between 10% and 13% in fiscal 2021. P&G followed suit in January, when it released its fiscal second quarter results. He said he now expects sales for the full year to increase between 5% and 6%, against his previous forecast of 3% to 4%.
P&G shares closed Tuesday’s session up 0.74% at $ 127.52 each.