Go to... Toggle SGML Header (+) Section 1: 8 K (AMJ Q4 FY15 POWERPOINT) UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8 K CURRENT REPORT Pursuant to Section 13 OR 15(d) of The Securities Exchange Act Of 1934 Date of Report (Date of earliest event reported) July 30, 2015 THE PROCTER & GAMBLE COMPANY (Exact name of registrant as specified in its charter) Ohio 1 434 31 0411980 (Commission File Number) (State or other jurisdiction of incorporation) (IRS Employer Identification Number) One Procter & Gamble Plaza, Cincinnati, Ohio 45202 (Address of principal executive offices) Zip Code (513) 983 1100 45202 (Registrant's telephone number, including area Zip Code code) Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) Soliciting material pursuant to Rule 14a 12 under the Exchange Act (17 CFR 240.14a 12) Pre commencement communications pursuant to Rule 14d 2(b)under the Exchange Act (17 CFR 240.14d 2(b)) Pre commencement communications pursuant to Rule 13e 4(c) under the Exchange Act (17 CFR 240.13e 4(c)) ITEM 7.01 REGULATION FD DISCLOSURE On July 30, 2015, The Procter & Gamble Company (the "Company") issued a press release announcing its fourth quarter and fiscal year results and hosted a conference call related to those results. The Company is furnishing on Form 8 K a series of slides referenced in the conference call, which are also posted on the Company's website. This 8 K is being furnished pursuant to Item 7.01, "Regulation FD Disclosure." SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.
J u ly 3 0, 2 0 1 5 P ro c te r& Ga mb le E a rn in g s Re le a s e :Q4 F Y 2 0 1 5 Re s u lts THE PROCTER & GAMBLE COMPANY BY: /s/ Susan S. Whaley Susan S. Whaley Assistant Secretary July 30, 2015 EXHIBIT(S) 99. Informational Slides Provided by The Procter & Gamble Company dated July 30, 2015. (Back To Top) Section 2: EX 99 (AMJ Q4 FY15 POWERPOINT SLIDES)
F is c a lye a r2 0 1 5 Bu s in e s s Re s u lts
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E s tima te d Re s ta te d F Y 1 5 Co re E P S * In c lu d e s re s u lts fo rth e S a lo n P ro fe s s io n a l, F ra g ra n c e,co s me tic s a n d Ha irco lo rc a te g o rie s Q1 Q2 Q3 Q4 F Y 1 5 As Re p o rte d 1.0 4 1.0 6 0.9 2 1.0 0 4.0 2 Ad ju s tme n ts fo rre s u lts * Re s ta te d to Dis c Op s (0.0 5 )(0.1 1 )(0.0 3 )(0.0 6 )(0.2 5 )E s tima te d Re s ta te d 0.9 9 0.9 5 0.8 9 0.9 4 3.7 7 In fo rma tio n a l8 K wilb e a v a ila b le in S e p te mb e rwith fin a lre s ta te me n ts.p le a s e n o te th a th e s e n u mb e rs a re e s tima te s. Bu s in e s s S e g me n ts
Ap r J u n 1 5 (Q4 F Y 1 5 )Re s u lts Be a u ty, Ha ir& P e rs o n a lca re S e g me n t+ 5 % P ric in g, 1 % Mix Org a n ic S a le s :h L o w s in g le d ig its in De v e lo p e d ma rk e ts,imid s in g le d ig its in De v e lo p in g ma rk e ts Glo b a lv a lu e s h a re d e c lin e d 0.7 p o in ts v e rs u s y e a ra g o Ne te a rn in g s :P ro d u c tiv ity imp ro v e me n ts a n d p ric in g we re mo re th a n o fs e tb y v o lu me d e c lin e, mix h u rts a n d c u re n c y h e a d win d s. Org a n ic S a le s Org a n ic Vo lu me Ne te a rn in g s 1 % 5 % 1 %
By Ca te g o ry Org a n ic S a le s Gro wth IYA Glo b a lde v e lo p e d De v e lo p in g Ha irca re ~ = ~ = ~ = S k in Ca re P e rs o n a lcle a n s in g ~ = De o d o ra n ts + + Co s me tic s ~ = + P re s tig e + S a lo n P ro fe s s io n a l+ + + Ap r J u n 1 5 (Q4 F Y 1 5 )Re s u lts Be a u ty,ha ir& P e rs o n a lca re Org a n ic S a le s + re p re s e n ts g ro wth a b o v e 1 %, ~ = re p re s e n ts g ro wth o f1 % to d e c lin e o f1 %; re p re s e n ts d e c lin e g re a te rth a n 1 %.
Ha irca re o rg a n ic s a le s we re in lin e with y e a ra g o. Glo b a ly, g ro wth o n He a d & S h o u ld e rs wa s o f s e tb y d e c lin e s in s ma le rha irca re a n d Co lo rb ra n d s.f o rf Y 1 5,U.S.P a n te n e g re w s a le s mid s in g le d ig its,a n d P 3 M v a lu e s h a re wa s u p n e a rly 1 p o in t.s k in Ca re o rg a n ic s a le s d e c lin e d d u e to c o mp e titiv e c h a le n g e s a c ro s s re g io n s. An tip e rs p ira n ts a n d d e o d o ra n ts o rg a n ic s a le s we re u p h ig h s in g le d ig its. De v e lo p e d ma rk e ts a le s in c re a s e d d o u b le d ig its with c o n tin u e d s tre n g th in Old S p ic e a n d we re p a rtia ly o fs e tb y De v e lo p in g ma rk e ts a le s d e c lin e d u e to a h ig h b a s e p e rio d fro m th e Old S p ic e e x p a n s io n.p e rs o n a lcle a n s in g o rg a n ic s a le s we re d o wn d u e to d e c lin e s in De v e lo p in g ma rk e ts la rg e ly b e h in d imp a c ts fro m tra d e in v e n to ry c o re c tio n s in Ch in a.co s me tic s o rg a n ic s a le s we re d o wn lo w s in g le d ig its. Mid s in g le d ig its a le s g ro wth in De v e lo p e d ma rk e ts b e h in d a fo c u s o n h ig h e rtie rp ro d u c ts a n d lo we rtra d e in v e s tme n ts wa s mo re th a n o fs e tb y d e c lin e s in De v e lo p in g ma rk e ts d u e to n e g a tiv e g e o g ra p h ic mix.org a n ic s a le s in P re s tig e d e c re a s e d lo w s in g le d ig its. S tro n g s a le s g ro wth in S KIwa s mo re th a n o fs e tb y d e c lin in g s a le s in F ra g ra n c e s d u e to lo we rle v e ls o fp ro d u c tin n o v a tio n v e rs u s th e b a s e p e rio d.s a lo n P ro fe s s io n a lo rg a n ic s a le s we re u p mid s in g le d ig its d riv e n b y p ric in g, in n o v a tio n a n d a lo w b a s e p e rio d. Ap r J u n 1 5 (Q4 F Y 1 5 )Re s u lts Glo b a lbe a u ty, Ha ir& P e rs o n a lca re Hig h lig h ts
Ap r J u n 1 5 (Q4 F Y 1 5 )Re s u lts Gro o min g S e g me n t+ 4 % P ric in g, 4 % Mix Org a n ic S a le s :ihig h s in g le s in De v e lo p e d ma rk e ts,imid s in g le s in De v e lo p in g ma rk e ts Glo b a lv a lu e s h a re d e c lin e d 0.3 p o in ts v e rs u s y e a ra g o Ne te a rn in g s :P ric e in c re a s e s a n d p ro d u c tiv ity s a v in g s we re mo re th a n o fs e tb y v o lu me d e c lin e s, mix h u rts a n d c u re n c y h e a d win d s. 7 % 3 4 % Org a n ic S a le s Org a n ic Vo lu me Ne te a rn in g s 7 %
By Ca te g o ry Org a n ic S a le s Gro wth IYA Glo b a lde v e lo p e d De v e lo p in g Bla d e s & Ra z o rs P re & P o s ts h a v e + ~ = + Bra u n & Ap p lia n c e s ~ = ~ = ~ = Ap r J u n 1 5 (Q4 F Y 1 5 )Re s u lts Gro o min g Org a n ic S a le s + re p re s e n ts g ro wth a b o v e 1 %,~ = re p re s e n ts g ro wth o f1 % to d e c lin e o f1 %; re p re s e n ts d e c lin e g re a te rth a n 1 %.
Glo b a lbla d e s & Ra z o rs o rg a n ic s a le s d e c lin e d in De v e lo p e d a n d De v e lo p in g ma rk e ts d riv e n b y a h ig h b a s e p e rio d fro m th e F le x Ba la u n c h in No rth Ame ric a a n d F IF A Wo rld Cu p in n o v a tio n a c ro s s re g io n s,p rio rq u a rte rin v e n to ry b u ild s fo rth e F le x Ba la u n c h in E u ro p e,in c re a s e d c o mp e titiv e a c tiv itie s in No rth Ame ric a, a n d in v e n to ry a d ju s tme n ts a fte re c e n td e v a lu a tio n p ric e in c re a s e s in Ru s s ia, Bra z ila n d J a p a n.ap p lia n c e s o rg a n ic s a le s we re u p s lig h tly a s g ro wth fro m re c e n tin n o v a tio n, lik e th e la u n c h o fs e rie s 9 s h a v e rs wa s o fs e tb y p ro mo tio n a lin v e s tme n ts. Ap r J u n 1 5 (Q4 F Y 1 5 )Re s u lts Glo b a lgro o min g Hig h lig h ts
Ap r J u n 1 5 (Q4 F Y 1 5 )Re s u lts He a lth Ca re S e g me n t+ 4 % P ric in g, + 3 % Mix Org a n ic S a le s :h Mid s in g le s in De v e lo p e d ma rk e ts,h Mid s in g le s in De v e lo p in g ma rk e ts Glo b a lv a lu e s h a re d e c lin e d 0.5 p o in ts v e rs u s y e a ra g o Ne te a rn in g s :P ric e in c re a s e s,mix h e lp s,a n d p ro d u c tiv ity s a v in g s we re mo re th a n o fs e tb y v o lu me d e c lin e s a n d c u re n c y h e a d win d s. Org a n ic S a le s Org a n ic Vo lu me Ne te a rn in g s 3 % 1 % 4 %
By Ca te g o ry Org a n ic S a le s Gro wth IYA Glo b a lde v e lo p e d De v e lo p in g Ora lca re + + + P e rs o n a lhe a lth Ca re + ~ = + Ap r J u n 1 5 (Q4 F Y 1 5 )Re s u lts He a lth Ca re Org a n ic S a le s + re p re s e n ts g ro wth a b o v e 1 %,~ = re p re s e n ts g ro wth o f1 % to d e c lin e o f1 %; re p re s e n ts d e c lin e g re a te rth a n 1 %.
Ora lca re o rg a n ic s a le s in c re a s e d mid s in g le d ig its. De v e lo p e d ma rk e ts a le s we re u p mid s in g le s d u e to p re miu m in n o v a tio n a n d De v e lo p in g ma rk e ts g re w lo w s in g le d ig its b e h in d p re miu m in n o v a tio n a n d p ric in g.p e rs o n a lhe a lth Ca re s a le s in c re a s e d lo w s in g le d ig its with De v e lo p in g ma rk e ts a le s u p h ig h s in g le s b e h in d p ric e in c re a s e s. De v e lo p e d ma rk e ts a le s we re fla ta s g ro wth in th e U.S. fro m in n o v a tio n a n d th e e n d o fa s tro n g c o u g h /c o ld s e a s o n wa s o fs e tb y d e c lin e s in P rilo s e c d u e to a n e w ma rk e te n tra n t. Ap r J u n 1 5 (Q4 F Y 1 5 )Re s u lts Glo b a lhe a lth Ca re Hig h lig h ts
Ap r J u n 1 5 (Q4 F Y 1 5 )Re s u lts F a b ric & Ho me Ca re S e g me n t+ 2 % P ric in g, F la tmix Org a n ic S a le s :h Mid s in g le s in De v e lo p e d ma rk e ts,il o w s in g le s in De v e lo p in g ma rk e ts Glo b a lv a lu e s h a re d e c lin e d 0.3 p o in ts v e rs u s y e a ra g o Ne te a rn in g s :P ro d u c tiv ity s a v in g s,p ric in g a n d c o mmo d ity imp ro v e me n ts we re o fs e tb y c u re n c y h e a d win d s a n d n e g a tiv e mix. Org a n ic S a le s Org a n ic Vo lu me 0 % 3 % 1 % Ne te a rn in g s
By Ca te g o ry Org a n ic S a le s Gro wth IYA Glo b a lde v e lo p e d De v e lo p in g F a b ric Ca re + + Ho me Ca re + + + P &G P ro fe s s io n a l+ + Ap r J u n 1 5 (Q4 F Y 1 5 )Re s u lts F a b ric & Ho me Ca re Org a n ic S a le s + re p re s e n ts g ro wth a b o v e 1 %,~ = re p re s e n ts g ro wth o f1 % to d e c lin e o f1 %; re p re s e n ts d e c lin e g re a te rth a n 1 %.
F a b ric Ca re o rg a n ic s a le s in c re a s e d lo w s in g le d ig its. De v e lo p e d ma rk e ts a le s we re u p mid s in g le d ig its with s o lid g ro wth in th e U.S.b e h in d in n o v a tio n a n d in J a p a n d u e to a lo w b a s e p e rio d d u e to th e VAT ta x in c re a s e.de v e lo p in g ma rk e ts a le s d e c lin e d b e h in d c o mp e titiv e a c tiv ity, in v e n to ry c o re c tio n s fro m d e v a lu a tio n p ric in g, min o rb ra n d d iv e s titu re s a n d th e d e p rio ritiz a tio n o fn o n s tra te g ic fo rms s u c h a s b a rs.u.s. F a b ric Ca re v a lu e s h a re g re w n e a rly 1 p o in tb e h in d th e la u n c h o fo u rin n o v a tio n b u n d le in th e Ma rc h q u a rte ra n d a d d itio n a lin v e s tme n ts.ho me Ca re o rg a n ic s a le s g re w mid s in g le d ig its. De v e lo p e d ma rk e ts a le s we re u p mid s in g le s d riv e n b y g ro wth fro m p re miu m in n o v a tio n in th e U.S. a n d De v e lo p in g ma rk e ts a le s in c re a s e d lo w s in g le d ig its d u e to p ric in g a n d s tro n g g ro wth o fd is h c a re. Ap r J u n 1 5 (Q4 F Y 1 5 )Re s u lts Glo b a lf a b ric & Ho me Ca re Hig h lig h ts
Ap r J u n 1 5 (Q4 F Y 1 5 )Re s u lts Ba b y, F e min in e & F a mily Ca re S e g me n t+ 3 % P ric in g, + 2 % Mix Org a n ic S a le s :h Mid s in g le s in De v e lo p e d ma rk e ts,imid s in g le s in De v e lo p in g Glo b a lv a lu e s h a re d e c lin e d 1.0 p o in ts v e rs u s y e a ra g o Ne te a rn in g s :P ric in g,lo we rc o mmo d ity c o s ts a n d p ro d u c tiv ity s a v in g s we re mo re th a n o fs e tb y c u re n c y h e a d win d s a n d ma rk e tin g in v e s tme n ts. Org a n ic S a le s Org a n ic Vo lu me
By Ca te g o ry Org a n ic S a le s Gro wth IYA Glo b a lde v e lo p e d De v e lo p in g Ba b y Ca re ~ = + F e min in e Ca re ~ = + F a mily Ca re + + Ap r J u n 1 5 (Q4 F Y 1 5 )Re s u lts Ba b y,f e min in e & F a mily Ca re Org a n ic S a le s + re p re s e n ts g ro wth a b o v e 1 %,~ = re p re s e n ts g ro wth o f1 % to d e c lin e o f1 %; re p re s e n ts d e c lin e g re a te rth a n 1 %.
Ba b y Ca re o rg a n ic s a le s we re in lin e with y e a ra g o a s s o lid g ro wth in th e U.S wa s p a rtia ly o fs e tb y in v e n to ry a d ju s tme n ts a n d c o n s u me rd e ma n d re d u c tio n s d u e to p ric in g fo rc u re n c y d e v a lu a tio n a n d tra d e te rms c h a n g e s in d e v e lo p in g ma rk e ts.in th e U.S.,b a b y c a re v a lu e s h a re wa s u p o v e r1 p o in tv e rs u s y e a ra g o b e h in d in n o v a tio n d riv e n u p tie rin g, with S wa d d le rs g ro win g v a lu e s h a re o v e r2 p o in ts v e rs u s la s ty e a r.f e min in e Ca re o rg a n ic s a le s we re in lin e with y e a ra g o. Mid s in g le d ig its a le s g ro wth in De v e lo p e d ma rk e ts d u e to th e Ad u ltin c o n tin e n c e la u n c h in 1 0 ma rk e ts, in c lu d in g No rth Ame ric a, U.K., F ra n c e, Ne th e rla n d s, Be lg iu m a n d Ge rma n y, a n d n e w in n o v a tio n o n th e b a s e b u s in e s s in th e U.S. wa s o fs e tb y v o lu me re d u c tio n s d u e to d e v a lu a tio n p ric in g in De v e lo p in g ma rk e ts.f a mily Ca re o rg a n ic s a le s we re u p mid s in g le d ig its a s g ro wth in th e U.S. b e h in d v a lu e in te rv e n tio n s wa s p a rtia ly o fs e tb y d e c lin e s in Me x ic o a s we fo c u s th e p o rtfo lio o n th e to p tie r. Ap r J u n 1 5 (Q4 F Y 1 5 )Re s u lts Glo b a lba b y, F e min in e & F a mily Ca re Hig h lig h ts
F is c a lye a r2 0 1 6 Gu id a n c e
F Y 2 0 1 6 Gu id a n c e * Org a n ic S a le s F Y 1 6 Org a n ic S a le s Gro wth In lin e to Up L o w S in g le Dig its Cu re n c y 4 % to 5 % Min o rb ra n d d iv e s titu re s Mo d e s tdra g Al in S a le s Gro wth Do wn L o w to Mid S in g le Dig its * Gu id a n c e a s s u me s th a tba te rie s & tra n s itio n in g Be a u ty b u s in e s s e s a re a c c o u n te d fo ra s d is c o n tin u e d o p e ra tio n s
F Y 2 0 1 6 Gu id a n c e * E P S Gro wth F Y 1 6 (v s. re s ta te d F Y 1 5 )Co re Op e ra tin g In c o me Gro wth Up Mid to Hig h S in g le Dig its Co re E a rn in g s P e rs h a re Gro wth Do wn S lig h tly to Up Mid S in g le Dig its Al in E a rn in g s P e rs h a re Gro wth + 5 3 % to + 6 3 % Oth e rite ms Imp a c to n Co re E P S Ve n e z u e la a c c o u n tin g c h a n g e $ (0.0 5 )to (0.0 6 )Be a u ty d e a ltra n s itio n c o s ts $ (0.0 2 )to (0.0 3 )No n Op e ra tin g in c o me 2 % to 3 % T a x Ra te 4 % F o re ig n E x c h a n g e 3 % to 4 % Co mmo d itie s Mo d e s tbe n e fit* Gu id a n c e a s s u me s th a tba te rie s & tra n s itio n in g Be a u ty b u s in e s s e s a re a c c o u n te d fo ra s d is c o n tin u e d o p e ra tio n s
F Y 2 0 1 6 Gu id a n c e * E P S Gro wth F Y 1 6 Co re Op e ra tin g In c o me Gro wth Up Mid to Hig h S in g le Dig its Co re E a rn in g s P e rs h a re Gro wth Do wn S lig h tly to Up Mid S in g le Dig its Al in E a rn in g s P e rs h a re Gro wth + 5 3 % to 6 3 % Oth e rite ms :Ve n e z u e la De c o n s o lid a tio n $ (0.0 5 )to (0.0 6 )Be a u ty d e a ltra n s itio n c o s ts $ (0.0 2 )to (0.0 3 )No n Op e ra tin g in c o me $ (0.0 9 )to (0.1 0 )T a x Ra te $ (0.1 6 )F o re ig n E x c h a n g e $ (0.1 2 )to (0.1 5 )Co mmo d itie s Mo d e s tbe n e fit* Gu id a n c e a s s u me s th a tba te rie s & tra n s itio n in g Be a u ty b u s in e s s e s a re a c c o u n te d fo ra s d is c o n tin u e d o p e ra tio n s F Y 2 0 1 6 Gu id a n c e Ca s h Ge n e ra tio n & Us a g e F re e Ca s h F lo w P ro d u c tiv ity :9 0 1 0 0 %Ca p ita ls p e n d in g,% S a le s :5 % to 6 %Div id e n d s :$ 7 B+ S h a re Re tire me n t/re p u rc h a s e s :$ 8 B to $ 9 B * S h a re s re tire d a th e c lo s e o fth e Du ra c e ltra n s a c tio n.
F o rwa rd L o k in g S ta te me n ts Ce rta in s ta te me n ts in th is re le a s e o rp re s e n ta tio n, o th e rth a n p u re ly h is to ric a lin fo rma tio,in c lu d in g e s tima te s,p ro je c tio n s,s ta te me n ts re la tin g to o u rb u s in e s p la n s,o b je c tiv e s a n e x p e c te d o e ra tin g re s u lts,a d th e a s s u mp tio n s u p o n wh ic h th o s e s ta te me n ts a re b a s e d, a re " fo rwa rd lo o k in g s ta te me n ts " with in th e me a n in g o fth e P riv te S e c u ritie s L itig a tio n Re fo rm Ac to f1 9 9 5, S e c tio n 2 7 A o fth e S e c u ritie s Ac to f1 9 3 3, a n d S e c tio n 2 1 E o fth e S e c u ritie s E x c h a n g Ac to f1 9 3 4. T h e s e fo rwa rd lo o k in g s ta te me n ts g e n e ra ly a re id n tifie d b y th e wo rd s " b e lie v e," " p ro je c t," " a n tic ip a te," " e s tima te," " e x p e c t," " in te n d," " s tra te g y," " fu tu re," " o p p o rtu n ity," " p la n," " ma y," " s h o u ld," " wil," " wo u ld," " wilb e," " wilc o n tin u e," " wilik e ly re s u lt," a n d imila re x p re s s io n s. F o rwa rd lo o k in g s ta te me n ts a re b a s e d o n c u re te x p e c ta tio n s a n d a s s u mp tio n s, wh ic h a re s u b je c to ris k s a n d u n c e rta in tie s th a tma y a u e re s u lts to d ife rma te ria ly fro m th o s e x p re s s e o rimp lie d in th e fo rwa rd lo o k in g s ta te me n ts. We u n d e rta k e n o o b lig a tio n to u p d a te o re v is e p u b lic ly a n fo rwa rd lo o k in g s ta te me n ts, wh e th e rb e c a u s e o fn e w in fo rma tio n, fu tu re e v e n ts o ro th e rwis e. Ris k s a n d u n c e rta in tie s to wh ic h o rfo rwa rd lo o k in g s ta te me n ts a re s u b je c tin c lu d, with o u tlimita tio n :(1 )th e a b ility to s u c c s s fu ly ma n a g e g lo b a lfin a n c ia l, o p ra tio n la n d ma n u fa c tu rin g ris k s, in c lu d in g, a mo n g o th e rs,(a )a n in c re a s in g ly v o la tile e c o n o mic e n v iro n me n t,with p te n tia ly s ig ific a n td is ru p tio n s a n d re d u c e d ma rk e tg ro wth ra te s,(b )fo re ig n c u re n c y flu c tu a tio n s,(c )s ig n ific a n tc re d ito rliq u id ity is s u e s,(d )d e b t,c u re n c y e x p o s u re a n d re p a tria tio n is s u e s in c o u trie s with c u re n c y e x c h a n g e, imp o rta u th o riz a tio n o rp ric in g c o n tro ls (s u c h a s Ve n e z u e la,arg e n tin a,ch in a,in ia a n d E g y p t),(e )ma in ta in in g k e y ma n u fa c tu rin a n d s u p p ly s o u rc e s (in c lu d in g s o le s u p p lie ra n s o le ma n u fa c tu rin g p la n ta ra n g e me n ts ),a n d (f)ma n a g in g d is ru p tio n o fb u s in e s s d u e to fa c to rs o u ts id e o fo u rc o n tro l, s u c h a s a tu ra ld is a s te rs a n d a c ts o fwa ro rte ro ris m;(2 )th e a b ility to s u c c e s s fu ly ma n a g e c o tflu tu a tio n s a n d p re s s u re s, in c lu d in g c o mmo d ity p ric e, ra w ma te ria ls, la b o rc o s ts, e n e rg y c o s ts p e n s io n a n d h e a lth c a re c o s ts, a n d a c h ie v e c o s ts a v in g s d e c rib e d in o u ra n n o u n c e d p ro d u c tiv ity p la n ;(3 )th e a b ility to s ta y o n th e le a d in g e d g e o fin n o v a tio n, o b ta in n c e s s a ry in te le c tu a lp ro p e rty p ro te c tio n s a n d s u c c e s s fu ly re s p o n d to te c h n o lo g ic a la d v a n c e s a ta in e d b y, a n d a te n ts g ra n te d to, c o mp e tito rs ;(4 )th a b ility to c o mp e te with o u rlo c a la n d g lo b a lc o mp e tito rs b y s u c c e s s fu ly re s p o n d in g to o mp e titiv e fa c to rs, in c lu d in g p ric e s, p ro mo tio n a lin c e n tiv s a n d tra d e te rms fo rp ro d u ts ;(5 )th e a b ility to ma n a g e a n d ma in ta in k y c u s to me re la tio n s h ip s ;(6 )th e a b ility to p ro te c to u re u ta tio n a n d b ra n e q u ity b y s u c e s s fu ly ma n a g in g re a lo rp e rc e iv e d is s u e s, in c lu d in g c o n c e rn s a b o u ts a fe ty, q u a lity, e fic a c y o rs imila rma te rs th a tma y a ris e ;(7 )th e a b ility to s u c c e s s fu ly ma n a g e th e fin a n c ia l, le g a l, re p u ta tio n a la n d o p e ra tio n a lris k a s s o c ia te d with th ird p a rty re la tio n s h ip s,s u c h a s o u rs u p p lie rs,c o n tra c to rs a n d e x te rn a lb u s in e s s p a rtn e rs ;(8 )th e a b ility to re ly o n a n d ma in ta in k e y in fo rma tio n te c h n o lo g y s y s te ms a n d n e two rk s (in c lu d in g Co mp a n y a n d th ird p a rty s y s te ms a n d n e two rk s )a n d ma in ta in th e s e c u rity a n d fu n c tio n a lity o fs u c h s y s te ms a n d n e two rk s a n d th e d a ta c o n ta in e d th e re in ;(9 )th e a b ility to s u c c e s s fu ly ma n a g e re g u la to ry,ta x a n d le g a lre q u ire me n ts a n d ma te rs (in c lu d in g,with o u tlimita tio n,p ro d u c tlia b ility,in te le c tu a lp ro p e rty,p ric e c o n tro ls, imp o rtre s tric tio n s, a c c o u n tin g s ta n d a rd s a n d e n v iro n me n ta la n d ta x p o lic y )a n d to re s o lv e p e n d in g ma te rs with in c u re n te s tima te s ;(1 0 )th e a b ility to s u c c e s s fu ly ma n a g e o u rp o rtfo lio o p timiz a tio n s tra te g y, a s we la s o n g o in g a c q u is itio n, d iv e s titu re a n d jo in tv e n tu re a c tiv itie s, to a c h ie v e th e Co mp a n y 's o v e ra lb u s in e s s s tra te g y, with o u timp a c tin g th e d e liv e ry o fb a s e b u s in e s s o b je c tiv e s ;(1 1 )th e a b ility to s u c c e s s fu ly a c h ie v e p ro d u c tiv ity imp ro v e me n ts a n d ma n a g e o n g o in g o rg a n iz a tio n a lc h a n g e s, wh ile s u c c e s s fu ly id e n tify in g, d e v e lo p in g a n d re ta in in g p a rtic u la rly k e y e mp lo y e e s, e s p e c ia ly in k e y g ro wth ma rk e ts wh e re th e a v a ila b ility o fs k ile d o re x p e rie n c e d e mp lo y e e s ma y b e limite d ;a n d (1 2 )th e a b ility to g e n e ra te s u fic ie n tin c o me a n d c a s h flo w to a lo w th e Co mp a n y to e fe c th e e x p e c te d s h a re re p u rc h a s e s a n d d iv id e n d p a y me n ts. F o ra d d itio n a lin fo rma tio n c o n c e rn in g fa c to rs th a tc o u ld c a u s e a c tu a lre s u lts to ma te ria ly d ife rfro m th o s e p ro je c te d h e re in, p le a s e re fe rto o u rmo s tre c e n t1 0 K, 1 0 Q a n d 8 K re p o rts.
The Procter & Gamble Company Regulation G Reconciliation of Non GAAP Measures In accordance with the SEC's Regulation G, the following provides definitions of the non GAAP measures used in Procter & Gamble's July 30, 2015 earnings call and associated slides and the reconciliation to the most closely related GAAP measure. The measures provided are as follows: 1. Organic Sales Growth pages 1 and 2 2. Core EPS and Currency Neutral Core EPS pages 3 5 3. Core Operating Profit Margin page 6 4. Core Gross Margin page 6 5. Core Selling, General & Administrative Expenses (SG&A) as a % of Net Sales page 6 6. Core Effective Tax Rate page 7 7. Adjusted Free Cash Flow page 7 8. Adjusted Free Cash Flow Productivity page 8 1. Organic Sales Growth: Organic sales growth is a non GAAP measure of sales growth excluding the impacts of acquisitions, divestitures and foreign exchange from year over year comparisons. We believe this provides investors with a more complete understanding of underlying sales trends by providing sales growth on a consistent basis. Organic sales is also one of the measures used to evaluate senior management and is a factor in determining their at risk compensation. The reconciliation of reported sales growth to organic sales is as follows: Foreign Exchange Impact Acquisition/ Divestiture Impact* Organic Sales Growth Three Months Ended June 30 Net Sales Growth Beauty, Hair and Personal Care (10)% 8% 1% (1)% Grooming (18)% 11% 0% (7)% Health Care (6)% 10% 0% 4% Fabric Care and Home Care (7)% 9% 1% 3% Baby, Feminine and Family Care (7)% 8% 0% 1% Total P&G (9)% (9)% 0% 0% Foreign Exchange Impact Organic Sales Prior Periods (Restated for Batteries Discontinued Operations) Acquisition/ Divestiture Impact* Total Company Net Sales Growth FY 2015 (5)% 6% % 1% FY 2014 % 3% 0% 3% FY 2013 1% 2% % 3% Organic Sales Growth Foreign Exchange Impact Acquisition/ Divestiture Impact* Total Company Net Sales Growth AMJ 2014 (1)% 2% 1% 2% JAS 2014 % 1% 1% 2% OND 2014 (4)% 5% 1% 2% JFM 2015 (8)% 8% 1% 1% Organic Sales Growth *Acquisition/Divestiture Impact includes volume and mix impacts of acquired and divested businesses, as well as rounding impacts necessary to reconcile net sales to organic sales. Total P&G FY 2016 Estimate Net Sales Growth Down lowto mid single digits Foreign Exchange Impact Acquisition/ Divestiture Impact* Approximately 5% 0% Organic Sales Growth In line to up low single digits *Acquisition/Divestiture Impact includes volume and mix impacts of acquired and divested businesses, as well as rounding impacts necessary to
reconcile net sales to organic sales. The core earnings measures included in the following reconciliation tables refer to the equivalent GAAP measures adjusted as applicable for the following items: charge in 2015 related to the change in accounting for our Venezuelan subsidiaries charges for incremental restructuring due to increased focus on productivity and cost savings, charges for balance sheet impacts from the devaluation of the foreign currency exchange rate in Venezuela and charges for certain European legal matters. We do not view these items to be part of our sustainable results. We believe that these Core measures provide an important perspective of underlying business trends and results and provide a more comparable measure of year on year earnings per share growth. Core EPS is also one of the measures used to evaluate senior management and is a factor in determining their at risk compensation. 2. Core EPS and Currency neutral Core EPS: Core EPS is a measure of the Company's diluted net earnings per share from continuing operations adjusted as indicated below. Currency neutral Core EPS is a measure of the Company's Core EPS excluding the incremental current year impact of foreign exchange. We believe the currency neutral Core EPS measure provides a more comparable view of year on year earnings per share growth. The table below provides a reconciliation of diluted net earnings per share to Core EPS and Core EPS to Currency neutral Core EPS: Three Months Ended June 30 2015 2014 Diluted Net Earnings Per Share from Continuing Operations $ 0.22 $ 0.87 Incremental Restructuring 0.07 0.04 Charges for European Legal Matters (0.01) 0.02 Venezuela Devaluation 0.71 Rounding 0.01 Core EPS $ 1.00 $ 0.93 Percentage change vs. prior period 8% Currency Impact to Earnings $ 0.13 Currency Neutral Core EPS $ 1.13 Percentage change vs. prior period 22% Note All reconciling items are presented net of tax. Tax effects are calculated consistent with the nature of the underlying transaction. Diluted EPS Growth Impact of Incremental Non Core Items Core EPS Growth Total P&G FY 2016 (Estimate) 53% to 63% (47)% to (64)% (1)% to 6% Core EPS and Currency Neutral Core EPS Prior Periods (Restated for Batteries Discontinued Operations) JFM 14 FY15 FY14 AMJ 14 AMJ 13 JAS 14 JAS 13OND 14 OND 13 JFM 15 Diluted Net Earnings Per Share from Continuing Operations, attributable to P&G $ 0.87 $ 0.61 $ 0.97 $ 1.00 $ 1.02 $ 1.12 $ 0.85 $ 0.87 $ 3.06 $3.86 $3.71 Incremental Restructuring 0.04 0.01 0.03 0.03 0.03 0.02 0.07 0.04 0.20 0.12 0.17 Venezuela B/S Remeasurement & Devaluation 0.04 0.04 0.10 0.04 0.09 0.08 FY 13
Impacts Venezuela 0.71 Deconsolidation Charges for Pending European Legal Matters 0.02 0.04 0.01 0.01 0.02 0.05 Goodwill & Intangible Impairment 0.10 0.10 Rounding (0.01) (0.01) (0.01) Core EPS $ 0.93 $ 0.76 $ 1.04 $ 1.01 $ 1.06 $ 1.15 $.92 $ 1.00 $ 4.02 $4.09 $3.89 Percentage change vs. prior period 22% 3% (8)% (8)% (2)% 5% 6% Currency Impact to Earnings 0.04 0.07 0.16 0.18 0.53 0.34 0.16 Currency Neutral Core EPS $ 0.97 $ 1.11 $ 1.22 $ 1.10 $ 4.55 $4.43 $4.05 Percentage change vs. prior period 28% 10% 6% 10% 11% 14% 10% 3. Core Operating Profit Margin: This is a measure of the Company's operating margin adjusted for items as indicated below. AMJ 15 AMJ 14 FY 15 FY 14 Operating Profit Margin 5.2% 16.1% 15.5% 18.3% Incremental Restructuring 1.5% 0.7% 0.9% 0.5% Venezuela Charge 11.4% % 2.7% % Venezuela Balance Sheet Revaluation and Devaluation % % 0.2% 0.4% Charges for European Legal Matters (0.1)% 0.3% % 0.1% Rounding 0.1% 0.1% % % Core Operating Profit Margin 18.1% 17.2% 19.3% 19.3% Basis Point Change 90 4. Core Gross Margin: This is a measure of the Company's gross margin adjusted for items as indicated below. AMJ 15 AMJ 14 FY 15 FY 14 Gross Margin 48.0% 47.5% 49.0% 49.1% Incremental Restructuring 1.1% 0.5% 0.7% 0.4% Rounding (0.1)% Core Gross Margin 49.1% 48.0% 49.7% 49.4% Basis Point Change 110 30 5. Core Selling, General and Administrative Expense (SG&A) as a percentage of sales: This is a measure of the Company's SG&A as a percentage of sales adjusted for items as indicated below. AMJ 15 AMJ 14 FY 15 FY 14 SG&A as a % of NOS 31.3% 31.4% 30.9% 30.8% Incremental Restructuring (0.4)% (0.2)% (0.3)% (0.2)% Venezuela Balance Sheet Revaluation and Devaluation % % (0.2)% (0.4)% Charges for European Legal Matters 0.1% (0.3)% % (0.1)% Rounding 0.1% 0.1% Core SG&A as a % of NOS 31.0% 30.9% 30.5% 30.2% Basis Point Change 10 30 6. Core Tax Rate: This is a measure of the Company's tax rate on continuing operations adjusted for items as indicated below.
AMJ 15 AMJ 14 FY 15 FY 14 Effective Tax Rate 49.6% 18.8% 24.6% 21.1% Incremental Restructuring 0.5% 0.2% 0.1% (0.1)% Charges for European Legal Matters 0.1% (0.3)% % (0.1)% Venezuela Balance Sheet Revaluation and Devaluation % % 0.1% (0.3)% Venezuela Charge (31.2)% % (3.8)% % Rounding 0.1% % (0.1)% % Core Tax Rate 19.1% 18.7% 20.9% 20.6% Basis Point Change 40 30 7. Adjusted free cash flow: Adjusted free cash flow is defined as operating cash flow less capital spending excluding tax payments for the Pet divestiture. We view adjusted free cash flow as an important measure because it is one factor used in determining the amount of cash available for dividends and discretionary investment. The reconciliation of adjusted free cash flow is provided below (amounts in millions): Operating Cash Flow Capital Spending Free Cash Flow Cash Tax Payment Pet Sale Adjusted Free Cash Flow Three Months Ended June 30, 2015 $3,988 $(1,274) $2,714 $183 $2,897 Operating Free Cash Tax Adjusted Cash Capital Cash Payment Pet Free Cash Flow Spending Flow Sale Flow FY 2015 $14,608 $(3,736) $10,872 $729 $11,601 8. Adjusted free cash flow productivity: Adjusted free cash flow productivity is defined as the ratio of adjusted free cash flow to net earnings excluding impairment charges. The Company's long term target is to generate annual free cash flow at or above 90 percent of net earnings. Adjusted free cash flow productivity is also a measure used to evaluate senior management and is a factor in determining their at risk compensation. The reconciliation of adjusted free cash flow productivity is provided below: Adjusted Free Cash Flow Net Earnings Impairment & Venezuela Charges Net Earnings Excl. Impairment Charges Adjusted Free Cash Flow Productivity Three Months Ended June 30, 2015 $2,897 $538 $2,205 $2,743 106% Adjusted Impairment Net Earnings Adjusted Free Cash Flow Net Earnings & Venezuela Charges Excl. Impairment Charges Free Cash Flow Productivity FY 2015 $11,601 $7,144 $4,187 $11,331 102% (Back To Top)