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Procter & Gamble to Expand in Hungary, Create 250 Jobs


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Consumer goods giant The Procter & Gamble Co. (PG - Analyst Report) intends to expand operations in two of its manufacturing plant at Csomor and Gyongyos, Hungary. The proposed expansion will involve an investment of $200 million, creating 250 positions.

The signing of the expansion agreement with Hungarian government officials reportedly took place at P&G’s Hyginett Plant in Csomor, where it will upgrade technology to manufacture women’s sanitary pads. Packaging operations for its Braun razor brand and assembly and packaging operations for some Oral B tooth care products will be carried out at its Baby Care plant in Gyongyos.

Notably, total P&G employs about 1,200 workers in Hungary. About 800 people work at the Hyginett Plant whereas the Baby Care plant has employed more than 150 workers.

Management is optimistic about the fact that this expansion, which is part of its global supply chain transformation, will make P&G’s end-to-end supply network more efficient, productive, innovative and better positioned to drive growth.

Notably, P&G’s core earnings per share dipped 2% to $3.67 in fiscal 2016. Although the company’s organic sales grew 1% year over year, its net sales were down 8% to $65.3 billion. Though weak sales have been offsetting margin improvement from pricing gains and cost cuts for some time now, P&G is investing in its brands and products as well as re-designing the supply chain to boost productivity and organic growth.

In the wake of intensifying competition from industry peers like Colgate-Palmolive Co. (CL - Analyst Report) , The Clorox Company (CLX - Analyst Report) and Reckitt Benckiser Group plc (RBGLY - Snapshot Report) , the expansion drive could likely be P&G’s strategy to boost its top line.

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