|
--Maintains Fiscal 2013 Core EPS Guidance at $3.80 to $4.00
The Procter & Gamble Company (PG) increased organic sales for the
April-June quarter by three percent driven by price increases, partially
offset by geographic mix. Net sales were $20.2 billion, a decrease of
one percent versus the prior year period. Foreign exchange reduced net
sales by four percent. The Company continued to deliver broad-based
organic sales growth, with four of five business segments increasing
versus the prior year.
Diluted net earnings per share from continuing operations were $0.74,
including non-core charges of $0.08 per share. Core net earnings per
share were $0.82, consistent with the prior year period and $0.03 per
share above the top-end of the Company’s guidance range. Additionally,
P&G completed the sale of the Snacks business in the quarter, resulting
in a net gain of $0.48 per share.
"We enter fiscal 2013 with very strong developing market momentum,
strengthened plans on our core developed market business, and with the
benefit of a $10 billion cost savings program, which is well underway,"
said Chairman, President and Chief Executive Officer, Bob McDonald.
"Despite a difficult macro environment, we see significant opportunities
for top- and bottom-line growth."
Executive Summary
--
Organic sales increased three percent for the quarter.
--
Organic sales growth was broad-based, with four of five business
segments increasing organic sales.
--
Core operating profit increased four percent. Including non-core
charges, operating profit decreased four percent.
--
Core net earnings per share were in line with the prior year period at
$0.82. The benefits from cost savings and pricing were offset by the
decrease in net sales and higher commodity costs.
--
Diluted net earnings per share were $1.24, an increase of 48 percent
due to the gain on sale of the Snacks business, partially offset by
non-core charges. The non-core items included incremental
restructuring charges due to the productivity and cost savings plan.
--
Diluted net earnings per share from continuing operations were $0.74,
a decrease of 10 percent due to non-core restructuring charges.
--
Operating cash flow was $4.0 billion for the quarter and free cash
flow, which is operating cash flow less capital spending, was $2.7
billion. Adjusted free cash flow productivity was 142 percent of net
earnings.
April - June Quarter Discussion
Net sales decreased one percent to $20.2 billion in the April - June
quarter. Organic sales grew three percent. Volume was in line with the
year ago period. Broad-based price increases across all segments and
regions increased net sales by four percent. This represented the fourth
consecutive quarter in which positive pricing contributed four percent
or more to net sales growth. Unfavorable foreign exchange reduced net
sales growth by four percent. Geographic mix reduced net sales by one
percent.
Diluted net earnings per share from continuing operations were $0.74 per
share, a decrease of 10 percent due to non-core incremental
restructuring charges of $0.08 per share. Gross margin contracted 40
basis points due mainly to higher commodity costs, unfavorable
geographic and product mix and restructuring charges, which were
partially offset by positive pricing and cost savings. Selling, general
and administrative expenses (SG&A) as a percentage of net sales
decreased 10 basis points.
Core net earnings per share were $0.82, in line with the prior year
period. Excluding non-core charges, core gross margin increased 10 basis
points and SG&A as a percentage of net sales decreased 80 basis points.
Core operating profit, which excludes non-core items, increased four
percent.
Operating cash flow was $4.0 billion for the fourth quarter and free
cash flow was $2.7 billion. The Company returned $1.6 billion of cash to
shareholders as dividends. In April 2012, P&G increased its dividend for
the 56th consecutive year, making P&G one of only six U.S.
companies with this track record of dividend increases. P&G has paid a
dividend for 122 consecutive years.
Fiscal Year Discussion
Net sales increased three percent to $83.7 billion for fiscal 2012 on
unit volume that was in line with the prior year period. Organic sales
grew three percent. Price increases across all segments improved net
sales by four percent, partially offset by unfavorable geographic and
product mix which reduced net sales by one percent.
Diluted net earnings per share were $3.66 per share, a decrease of seven
percent due to non-core items. The non-core items included impairment
charges for goodwill and indefinite lived intangible assets of $0.51 per
share, incremental restructuring charges of $0.20 per share and earnings
from discontinued operations of $0.54 per share. Excluding non-core
items, Core EPS was $3.85, a decrease of one percent versus the prior
year. Gross margin contracted 160 basis points due mainly to higher
commodity costs, unfavorable geographic and product mix and
restructuring charges, which were partially offset by positive pricing
and cost savings. Selling, general and administrative expenses (SG&A) as
a percentage of net sales decreased 30 basis points due to productivity
savings, sales leverage and reduced charges for European legal matters,
partially offset by an increase in marketing spending and incremental
restructuring charges.
Operating cash flow in fiscal 2012 was $13.3 billion. The Company
returned $6.1 billion of cash to shareholders as dividends and
repurchased $4 billion of P&G stock in fiscal 2012.
Business Segment Discussion
--
Beauty Care net sales decreased four percent to $4.8 billion. Organic
sales grew one percent. Unit volume decreased one percent. Price
increases added four percent to net sales growth. Mix reduced net
sales by three percent due to disproportionate growth in developing
regions and in product categories that have lower than segment average
selling prices. Unfavorable foreign exchange reduced net sales by four
percent. Volume in Hair Care was in line with the prior year period
due to mid-single digit growth in developing regions driven by market
growth, product innovations and distribution expansions in Asia. The
growth in developing regions was offset by developed regions which
decreased mid-single digits due to competitive pressure in North
America and Western Europe. Volume in Beauty, which includes skin,
cosmetics and personal care product categories, decreased mid-single
digits due to market share softness in the United States and China.
Volume in Prestige Products increased mid-single digits, driven by
initiative activity across fragrances and SK-II. Net earnings were in
line with the prior year period at $382 million as net earnings margin
expansion offset the impact of reduced net sales. Net earnings margin
increased due to a reduction in the effective tax rate partially
offset by higher commodities and unfavorable geographic and product
mix.
--
Grooming net sales decreased six percent to $2.0 billion. Unit volume
and organic sales were in line with the prior year period. Price
increases added one percent to net sales growth, while unfavorable
product mix decreased net sales by one percent mainly due to
disproportionate growth in developing markets. Foreign exchange
reduced net sales by six percent. Shave Care volume was in line with
the prior year period. Low single digit growth in developing regions
behind market growth and product and commercial innovation was offset
by a low single digit decrease in developed regions due to competitive
activity and market contraction in Western Europe. Volume in
Appliances increased mid-single digits with developed markets up
double digits primarily due to product innovation and in-store
programs. Grooming net earnings were in line with prior year at $406
million as an expansion in operating margin was offset by the decrease
in net sales. Operating margin increased mainly due to gross margin
expansion resulting from manufacturing cost savings and higher pricing.
--
Health Care net sales decreased one percent to $2.9 billion. Unit
volume increased one percent with organic volume in line with the
prior year period. Organic sales were up three percent. Pricing
increased net sales by four percent. Unfavorable product mix decreased
net sales by one percent. Foreign exchange reduced net sales by five
percent. Oral Care volume decreased low single digits due to
competitive activity in developed markets and pricing gaps in Greater
China. Volume in Feminine Care grew low single digits due to market
growth and product innovation in developing markets. Personal Health
Care volume increased mid-single digits, with organic volume
decreasing low single digits due to initiative activity in the base
period and lower shipments of Metamucil in North America. Net earnings
decreased two percent to $336 million due to gross margin contraction
partially offset by a reduction in SG&A expenses. Gross margin
decreased due to higher commodity costs and unfavorable mix, partially
offset by higher pricing and manufacturing cost savings.
--
Fabric Care and Home Care net sales decreased one percent to $6.6
billion. Unit volume decreased one percent. Organic sales were up
three percent. Pricing increased net sales by five percent. Mix
reduced net sales by one percent due to unfavorable geographic mix.
Foreign exchange reduced net sales by four percent. Fabric Care volume
decreased low single digits as growth in developing regions, driven by
product innovation and market growth, was more than offset by a
decrease in developed regions due to consumer value issues following
price increases taken in previous periods. Home Care volume increased
low single digits driven by a double digit increase in developing
markets behind innovation and distribution expansion and a low single
digit increase in developed markets due to Air Care innovation. Pet
Care volume decreased high single digits. Batteries volume decreased
low single digits due to distribution losses in developed regions,
partially offset by growth in developing regions from promotional and
initiative activity. Net earnings increased 10 percent to $635
million, due to operating margin expansion partially offset by the
decrease in net sales. Operating margin expanded behind lower SG&A
expenses and higher gross margin, as higher pricing and manufacturing
cost savings more than offset increased commodity costs.
--
Baby Care and Family Care net sales increased one percent to $4.1
billion on unit volume growth of one percent. Organic sales increased
five percent. Pricing increased net sales by four percent. Foreign
exchange reduced net sales by four percent. Baby Care volume increased
mid-single digits behind double digit growth in developing markets
driven by market size growth, product innovation and distribution
expansion, and by single digit growth in developed markets due to
promotional activity. Volume in Family Care decreased high single
digits primarily behind a strong base year period from volume pull
forward ahead of price increases. Net earnings increased 13 percent to
$540 million primarily due to operating margin expansion. Operating
margin increased driven by a higher gross margin. Gross margin
increased as price increases and manufacturing cost savings were
partially offset by higher commodity costs.
Snacks Divestiture
The Company divested the Snacks business to The Kellogg Company during
the April - June quarter. The transaction resulted in a net after tax
gain of $0.48 per share, including $0.02 per share of restructuring
costs to eliminate stranded overhead costs.
Fiscal Year 2013 Guidance
Net sales for fiscal 2013 are expected to be in line to down two percent
versus the prior year, including a negative four percent impact from
foreign exchange. Organic sales are expected to increase two to four
percent. Pricing is expected to add two percent to sales, and
unfavorable product and geographic mix is expected to reduce sales by
one percent. Diluted net earnings per share are expected to be in the
range of $3.61 to $3.85. Core EPS is expected to be in the range of
$3.80 to $4.00, consistent with the preliminary outlook provided by the
Company. Core EPS estimates exclude non-core restructuring charges of
$0.15 to $0.19.
The Company said it will repurchase $4 billion in P&G stock over the
course of the fiscal year.
July - September 2012 Quarter Guidance
For the July - September quarter, net sales growth is estimated to be
down six to down four percent versus the prior year period, including a
six percent negative impact from foreign exchange. Organic sales are
expected to be in-line to up two percent. Pricing is expected to add
three percent to sales growth. Diluted net earnings per share are
expected to be in the range of $0.83 to $0.91 which includes non-core
restructuring charges of $0.06 to $0.08 per share. Core EPS is expected
to be in the range of $0.91 to $0.97 versus a base period Core EPS of
$1.01. A major driver of the lower first quarter EPS outlook is foreign
exchange, which is forecast to reduce net earnings by five to six
percent versus the prior year.
Forward-Looking Statements
Certain statements in this release or presentation, other than purely
historical information, including estimates, projections, statements
relating to our business plans, objectives, and expected operating
results, and the assumptions upon which those statements are based, are
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995, Section 27A of the Securities
Act of 1933, and Section 21E of the Securities Exchange Act of 1934.
These forward-looking statements generally are identified by the words
"believe," "project," "anticipate," "estimate," "intend," "strategy,"
"future," "opportunity," "plan," "may," "should," "will," "would," "will
be," "will continue", "will likely results," and similar expressions.
Forward-looking statements are based on current expectation and
assumptions that are subject to risks and uncertainties which may cause
results to differ materially from the forward-looking statements. We
undertake no obligation to update or revise publicly any forward-looking
statements, whether because of new information, future events or
otherwise.
Risks and uncertainties to which our forward-looking statements are
subject include: (1) the ability to achieve business plans, including
growing existing sales and volume profitably and maintaining and
improving margins and market share, despite high levels of competitive
activity, an increasingly volatile economic environment, lower than
expected market growth rates, especially with respect to the product
categories and geographical markets (including developing markets) in
which the Company has chosen to focus, and/or increasing competition
from mid- and lower tier value products in both developed and developing
markets; (2) the ability to successfully manage ongoing acquisition,
divestiture and joint venture activities to achieve the cost and growth
synergies in accordance with the stated goals of these transactions
without impacting the delivery of base business objectives; (3) the
ability to successfully manage ongoing organizational changes and
achieve productivity improvements designed to support our growth
strategies, while successfully identifying, developing and retaining key
employees, especially in key growth markets where the availability of
skilled employees is limited; (4) the ability to manage and maintain key
customer relationships; (5) the ability to maintain key manufacturing
and supply sources (including sole supplier and plant manufacturing
sources); (6) the ability to successfully manage regulatory, tax and
legal requirements and matters (including product liability, patent,
intellectual property, price controls, import restrictions,
environmental and tax policy), and to resolve pending matters within
current estimates; (7) the ability to resolve the pending competition
law inquiries in Europe within current estimates; (8) the ability to
successfully implement, achieve and sustain cost improvement plans and
efficiencies in manufacturing and overhead areas, including the
Company’s outsourcing projects; (9) the ability to successfully manage
volatility in foreign exchange rates, as well as our debt and currency
exposure (especially in certain countries with currency exchange
controls, such as Venezuela, China and India); (10) the ability to
maintain our current credit rating and to manage fluctuations in
interest rate, increases in pension and healthcare expense, and any
significant credit or liquidity issues; (11) the ability to manage
continued global political and/or economic uncertainty and disruptions,
especially in the Company’s significant geographical markets, due to a
wide variety of factors, including but not limited to, terrorist and
other hostile activities, natural disasters and/or disruptions to credit
markets, resulting from a global, regional or national credit crisis;
(12) the ability to successfully manage competitive factors, including
prices, promotional incentives and trade terms for products; (13) the
ability to obtain patents and respond to technological advances attained
by competitors and patents granted to competitors; (14) the ability to
successfully manage increases in the prices of commodities, raw
materials and energy, including the ability to offset these increases
through pricing actions; (15) the ability to develop effective sales,
advertising and marketing programs; (16) the ability to stay on the
leading edge of innovation, maintain a positive reputation on our brands
and ensure trademark protection; and (17) the ability to rely on and
maintain key information technology systems and networks (including
Company and third-party systems and networks), the security over such
systems and networks, and the data contained therein. For additional
information concerning factors that could cause actual results to
materially differ from those projected herein, please refer to our most
recent 10-K, 10-Q and 8-K reports.
About Procter & Gamble
P&G serves approximately 4.6 billion people around the world with its
brands. The Company has one of the strongest portfolios of trusted,
quality, leadership brands, including Pampers(R), Tide(R), Ariel(R), Always(R),
Whisper(R), Pantene(R), Mach3(R), Bounty(R), Dawn(R), Fairy(R), Gain(R), Charmin(R),
Downy(R), Lenor(R), Iams(R), Crest(R), Oral-B(R), Duracell(R), Olay(R), Head &
Shoulders(R), Wella(R), Gillette(R), Braun(R), Fusion(R), Ace(R), Febreze(R), Ambi
Pur(R), SK-II(R), and Vicks(R). The P&G community includes operations in
approximately 75 countries worldwide. Please visit http://www.pg.com
for the latest news and in-depth information about P&G and its brands.
The Procter & Gamble Company
Exhibit 1: Non-GAAP Measures
In accordance with the SEC’s Regulation G, the following provides
definitions of the non-GAAP measures used in the earnings release and
the reconciliation to the most closely related GAAP measure.
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:
Net Foreign Acquisition/ Organic
Sales Exchange Divestiture Sales
AMJ 2012 Growth Impact Impact* Growth
---------- -------- ------------ --------
Beauty Care -4% 4% 1% 1%
Grooming -6% 6% 0% 0%
Health Care -1% 5% -1% 3%
Fabric Care and Home Care -1% 4% 0% 3%
Baby Care and Family Care 1% 4% 0% 5%
------------------------- ---------- -------- ------------ --------
Total P&G -1% 4% 0% 3%
------------------------- ---------- -------- ------------ --------
Net Foreign Acquisition/ Organic
Sales Exchange Divestiture Sales
Total P&G Growth Impact Impact* Growth
------------------------- ---------- -------- ------------ --------
JAS 2012 (Estimate) -6% to -4% 6% 0% 0% to 2%
FY 2013 (Estimate) -2% to 0% 4% 0% 2% to 4%
------------------------- ---------- -------- ------------ --------
*Acquisition/Divestiture Impact includes rounding impacts necessary to
reconcile net sales to organic sales.
Core EPS: This is a measure of the
Company’s diluted net earnings per share from continuing operations
excluding current year impairment charges for goodwill and indefinite
lived intangible assets, current year incremental restructuring charges
due to increased focus on productivity and cost savings, charges in both
years related to the European legal matters and a significant prior year
settlement from U.S. tax litigation related to the valuation of
technology donations. We do not view these items to be part of our
sustainable results. We believe the Core EPS measure provides an
important perspective of underlying business trends and results and
provides 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.
The table below provides a reconciliation of diluted net earnings per
share to Core EPS:
AMJ 12 AMJ 11
-------------- -------
Diluted Net Earnings Per Share $1.24 $0.84
Gain from snacks divestiture ($0.48)
Snacks results of operations - Discontinued Operations ($0.02) ($0.02)
-------------- -------
Diluted Net Earnings Per Share-Continuing Operations $0.74 $0.82
Incremental restructuring $0.08 -
-------------- -------
Core EPS $0.82 $0.82
Core EPS Growth 0%
JAS 12 (est.) JAS 11
-------------- -------
Diluted Net Earnings Per Share-Continuing Operations $0.83 to $0.91 $1.01
Incremental restructuring $0.08 to $0.06 -
-------------- -------
Core EPS $0.91 to $0.97 $1.01
Core EPS Growth -10% to -4%
FY FY
FY 2013 (est.) 2012 2011
-------------- ------- -------
Diluted Net Earnings Per Share $3.61 to $3.85 $3.66 $3.93
Gain from snacks divestiture ($0.48)
Snacks results of operations - Discontinued Operations ($0.06) ($0.08)
------- -------
Diluted Net EPS-Continuing Operations $3.61 to $3.85 $3.12 $3.85
Impairment charges $0.51
Incremental restructuring $0.19 to $0.15 $0.20
Charges for European legal matters $0.03 $0.10
Settlement from U.S. tax litigation - - ($0.08)
Rounding Impacts ($0.01) -
------- -------
Core EPS $3.80 to $4.00 $3.85 $3.87
Core EPS Growth -1% to 4% -1%
Note - All reconciling items are presented net of tax. Tax effects are
calculated consistent with the nature of the underlying transaction.
Core Operating Profit Growth: This is a
measure of the Company’s operating profit growth adjusted for the
current year charges related to incremental restructuring charges due to
increased focus on productivity and cost savings:
AMJ 2012
--------
Operating Profit Growth (4%)
Incremental restructuring 8%
--------
Core Operating Profit Growth 4%
Core Gross Margin: This is a measure of the
Company’s Gross Margin adjusted for the current year charges related to
incremental restructuring charges due to increased focus on productivity
and cost savings:
AMJ 12 AMJ 11
------ ------
Gross Margin 48.1% 48.5%
Incremental restructuring 0.5%
------
Core Gross Margin 48.6% 48.5%
Basis point change 10
Core SG&A as a % of Net Sales: This is
a measure of the Company’s SG&A as a % of Net Sales adjusted for the
current year charges related to incremental restructuring charges due to
increased focus on productivity and cost savings:
AMJ 12 AMJ 11
------ ------
Selling, General & Administrative Expenses (SG&A) as a % Net Sales 32.9% 33.0%
Incremental restructuring -0.7% -
------ ------
Core SGA % Net Sales 32.2% 33.0%
Basis point change -80
Free Cash Flow / Adjusted Free Cash Flow:
Free cash flow is defined as operating cash flow less capital spending.
Adjusted free cash flow is free cash flow adjusted for after-tax impacts
of major divestitures. We view free cash flow as an important measure
because it is one factor in determining the amount of cash available for
dividends and discretionary investment. Free cash flow is also one of
the measures used to evaluate senior management and is a factor in
determining their at-risk compensation. The reconciliation of free cash
flow is provided below (amounts in millions):
Cash Tax
Payments- Adjusted
Operating Capital Free Cash Snacks Free Cash
Cash Flow Spending Flow Divestiture Flow
--------- -------- --------- ----------- ---------
Apr-Jun ’12 $3,973 ($1,301) $2,672 $519 $3,191
------------------------------------- --------- -------- --------- ----------- ---------
Adjusted Free Cash Productivity: Adjusted
free cash flow productivity is defined as the ratio of adjusted free
cash flow to net earnings excluding the gains from major divestitures.
Given the size of these gains and our view that they are not part of our
sustainable results, we have excluded gains from our calculation. We
believe this provides a better perspective of our underlying liquidity
trends. The Company’s long-term target is to generate free cash flow at
or above 90 percent of net earnings. Adjusted free cash flow
productivity is also one of the measures 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 (amounts in millions):
Net Adjusted
Adjusted Earnings Free Cash
Free Cash Excluding Flow
Flow Net Earnings Snacks Gain Gain Productivity
--------- ------------ ----------- --------- ------------
Apr-Jun ’12 $3,191 $3,667 $1,418 $2,249 142%
------------------------------------- --------- ------------ ----------- --------- ------------
THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES
(Amounts in Millions Except Per Share Amounts)
Consolidated Earnings Information
Three Months Ended June 30 Twelve Months Ended June 30
----------------------------------------- ----------------------------------------
2012 2011 % CHG 2012 2011 % CHG
-------------- -------------- ----------- -------------- -------------- ----------
NET SALES $ 20,212 $ 20,451 (1 )% $ 83,680 $ 81,104 3 %
COST OF PRODUCTS SOLD 10,497 10,532 (0 )% 42,391 39,859 6 %
------- ------- ------- -------
GROSS PROFIT 9,715 9,919 (2 )% 41,289 41,245 0 %
SELLING, GENERAL & ADMINISTRATIVE EXPENSE 6,652 6,740 (1 )% 26,421 25,750 3 %
GOODWILL & INDEFINITE LIVED INTANGIBLE IMPAIRMENT CHARGES 0 0 - 1,576 0 -
------- ------- ------- -------
OPERATING INCOME 3,063 3,179 (4 )% 13,292 15,495 (14 )%
TOTAL INTEREST EXPENSE 182 212 (14 )% 769 831 (7 )%
OTHER NON-OPERATING INCOME/(EXPENSE), NET 24 162 (85 )% 262 333 (21 )%
------- ------- ------- -------
EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES 2,905 3,129 (7 )% 12,785 14,997 (15 )%
INCOME TAXES ON CONTINUING OPERATIONS 692 661 5 % 3,468 3,299 5 %
NET EARNINGS FROM CONTINUING OPERATIONS 2,213 2,468 (10 )% 9,317 11,698 (20 )%
------- ------- ======= =======
DISCONTINUED OPERATIONS:
INCOME FROM DISCONTINUED OPERATIONS BEFORE INCOME TAX 1,966 104 2,165 322
INCOME TAXES ON DISCONTINUED OPERATIONS 512 33 578 93
------- ------- ------- -------
NET EARNINGS FROM DISCONTINUED OPERATIONS 1,454 71 N/A 1,587 229 N/A
------- ------- ------- -------
NET EARNINGS 3,667 2,539 44 % 10,904 11,927 (9 )%
LESS: NET EARNINGS ATTRIBUTABLE TO NONCONTROLLING INTERESTS 36 29 24 % 148 130 14 %
------- ------- ------- -------
NET EARNINGS ATTRIBUTABLE TO PROCTER & GAMBLE 3,631 2,510 45 % 10,756 11,797 (9 )%
======= ======= ======= =======
EFFECTIVE TAX RATE 23.8 % 21.1 % 27.1 % 22.0 %
BASIC NET EARNINGS PER COMMON SHARE:
EARNINGS FROM CONTINUING OPERATIONS $ 0.76 $ 0.85 (11 )% $ 3.24 $ 4.04 (20 )%
EARNINGS FROM DISCONTINUED OPERATIONS $ 0.53 $ 0.03 1,667 % $ 0.58 $ 0.08 625 %
-- ------- -- ------- -- ------- -- -------
BASIC NET EARNINGS PER COMMON SHARE $ 1.29 $ 0.88 47 % $ 3.82 $ 4.12 (7 )%
DILUTED NET EARNINGS PER COMMON SHARE:
EARNINGS FROM CONTINUING OPERATIONS $ 0.74 $ 0.82 (10 )% $ 3.12 $ 3.85 (19 )%
EARNINGS FROM DISCONTINUED OPERATIONS $ 0.50 $ 0.02 2,400 % $ 0.54 $ 0.08 575 %
-- ------- -- ------- -- ------- -- -------
DILUTED NET EARNINGS PER COMMON SHARE $ 1.24 $ 0.84 48 % $ 3.66 $ 3.93 (7 )%
DIVIDENDS PER COMMON SHARE $ 0.5620 $ 0.5250 7 % $ 2.137 $ 1.9704 8 %
AVERAGE DILUTED SHARES OUTSTANDING 2,930.0 2,983.6 2,941.2 3,001.9
Basis Pt Basis Pt
COMPARISONS AS A % OF NET SALES Chg Chg
------------------------------------------------------------
GROSS MARGIN 48.1 % 48.5 % (40 ) 49.3 % 50.9 % (160 )
SELLING, GENERAL & ADMINISTRATIVE EXPENSE 32.9 % 33.0 % (10 ) 31.5 % 31.8 % (30 )
GOODWILL & INDEFINITE LIVED INTANGIBLE IMPAIRMENT CHARGES 0.0 % 0.0 % - 1.9 % 0.0 % 190
OPERATING MARGIN 15.2 % 15.5 % (30 ) 15.9 % 19.1 % (320 )
EARNINGS BEFORE INCOME TAXES 14.4 % 15.3 % (90 ) 15.3 % 18.5 % (320 )
NET EARNINGS FROM CONTINUING OPERATIONS 10.9 % 12.1 % (120 ) 11.1 % 14.4 % (330 )
NET EARNINGS ATTRIBUTABLE TO PROCTER & GAMBLE 18.0 % 12.3 % 570 12.9 % 14.6 % (170 )
THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES
(Amounts in Millions)
Consolidated Cash Flows Information
Twelve Months Ended June 30
---------------------------------------
2012 2011
------------------ ------------------
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD $ 2,768 $ 2,879
OPERATING ACTIVITIES
NET EARNINGS 10,904 11,927
DEPRECIATION AND AMORTIZATION 3,204 2,838
SHARE-BASED COMPENSATION EXPENSE 377 414
DEFERRED INCOME TAXES (65 ) 128
GAIN ON SALE OF BUSINESSES (2,106 ) (203 )
GOODWILL AND INDEFINITE LIVED INTANGIBLES IMPAIRMENT CHARGES 1,576 0
CHANGES IN:
ACCOUNTS RECEIVABLE (427 ) (426 )
INVENTORIES 77 (501 )
ACCOUNTS PAYABLE, ACCRUED AND OTHER LIABILITIES (22 ) 358
OTHER OPERATING ASSETS & LIABILITIES (444 ) (1,221 )
OTHER 210 16
------- -------
TOTAL OPERATING ACTIVITIES 13,284 13,330
------- -------
INVESTING ACTIVITIES
CAPITAL EXPENDITURES (3,964 ) (3,306 )
PROCEEDS FROM ASSET SALES 2,893 225
ACQUISITIONS, NET OF CASH ACQUIRED (134 ) (474 )
CHANGE IN INVESTMENTS 112 73
------- -------
TOTAL INVESTING ACTIVITIES (1,093 ) (3,482 )
------- ---- ------- ----
FINANCING ACTIVITIES
DIVIDENDS TO SHAREHOLDERS (6,139 ) (5,767 )
CHANGE IN SHORT-TERM DEBT (3,412 ) 151
ADDITIONS TO LONG-TERM DEBT 3,985 1,536
REDUCTIONS OF LONG-TERM DEBT (2,549 ) (206 )
TREASURY STOCK PURCHASES (4,024 ) (7,039 )
IMPACT OF STOCK OPTIONS AND OTHER 1,729 1,203
------- -------
TOTAL FINANCING ACTIVITIES (10,410 ) (10,122 )
------- ---- ------- ----
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS (113 ) 163
------- ---- -------
CHANGE IN CASH AND CASH EQUIVALENTS 1,668 (111 )
------- ------- ----
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 4,436 $ 2,768
==== ======= ==== =======
THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES
(Amounts in Millions)
Consolidated Balance Sheet Information
June 30, 2012 June 30, 2011
------------------ ------------------
CASH AND CASH EQUIVALENTS $ 4,436 $ 2,768
ACCOUNTS RECEIVABLE 6,068 6,275
TOTAL INVENTORIES 6,721 7,379
OTHER 4,685 5,548
------- -------
TOTAL CURRENT ASSETS 21,910 21,970
NET PROPERTY, PLANT AND EQUIPMENT 20,377 21,293
NET GOODWILL AND OTHER INTANGIBLE ASSETS 84,761 90,182
OTHER NON-CURRENT ASSETS 5,196 4,909
------- -------
TOTAL ASSETS $ 132,244 $ 138,354
==== ======= ==== =======
ACCOUNTS PAYABLE $ 7,920 $ 8,022
ACCRUED AND OTHER LIABILITIES 8,289 9,290
DEBT DUE WITHIN ONE YEAR 8,698 9,981
------- -------
TOTAL CURRENT LIABILITIES 24,907 27,293
LONG-TERM DEBT 21,080 22,033
OTHER 22,222 21,027
------- -------
TOTAL LIABILITIES 68,209 70,353
------- -------
TOTAL SHAREHOLDERS’ EQUITY 64,035 68,001
------- -------
TOTAL LIABILITIES & SHAREHOLDERS’ EQUITY $ 132,244 $ 138,354
==== ======= ==== =======
THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES
(Amounts in Millions)
Consolidated Earnings Information
Three Months Ended June 30, 2012
--------------------------------------------------------------------------------------
% Change % Change Net Earnings % Change
Versus Earnings Before Versus From Continuing Versus
Net Sales Year Ago Income Taxes Year Ago Operations Year Ago
----------------- -------------- --------------- ---------- --------------- ----------
Beauty Care $ 4,806 -4 % $ 544 -6 % $ 382 0 %
Grooming 2,007 -6 % 534 -2 % 406 0 %
Health Care 2,929 -1 % 496 -8 % 336 -2 %
Fabric Care and Home Care 6,551 -1 % 1,002 4 % 635 10 %
Baby Care and Family Care 4,099 1 % 840 5 % 540 13 %
Corporate (180 ) N/A (511 ) N/A (86 ) N/A
------ ---- ------------ ------ - -------- ------ - --------
Total Company 20,212 -1 % 2,905 -7 % 2,213 -10 %
Twelve Months Ended June 30, 2012
--------------------------------------------------------------------------------------
% Change % Change Net Earnings % Change
Versus Earnings Before Versus From Continuing Versus
Net Sales Year Ago Income Taxes Year Ago Operations Year Ago
----------------- -------------- --------------- ---------- --------------- ----------
Beauty Care $ 20,318 2 % $ 3,196 -6 % $ 2,390 -6 %
Grooming 8,339 1 % 2,395 1 % 1,807 2 %
Health Care 12,421 3 % 2,718 0 % 1,826 2 %
Fabric Care and Home Care 27,254 3 % 4,645 -5 % 2,915 -6 %
Baby Care and Family Care 16,493 6 % 3,351 5 % 2,123 7 %
Corporate (1,145 ) N/A (3,520 ) N/A (1,744 ) N/A
------ ---- ------------ ------ - -------- ------ - --------
Total Company 83,680 3 % 12,785 -15 % 9,317 -20 %
Three Months Ended June 30, 2012
--------------------------------------------------------------------------------------
(Percent Change vs. Year Ago)*
Volume Volume
With Without
Acquisitions/ Acquisitions/ Foreign Net Sales
Divestitures Divestitures Exchange Price Mix/Other Growth
----------------- -------------- --------------- ---------- --------------- ----------
Beauty Care -1 % -1 % -4 % 4% -3 % -4 %
Grooming 0 % 0 % -6 % 1% -1 % -6 %
Health Care 1 % 0 % -5 % 4% -1 % -1 %
Fabric Care and Home Care -1 % -1 % -4 % 5% -1 % -1 %
Baby Care and Family Care 1 % 1 % -4 % 4% 0 % 1 %
------ ---- ------ ------ ------ - -------- ------ - ---- ----
Total Company 0 % 0 % -4 % 4% -1 % -1 %
Twelve Months Ended June 30, 2012
--------------------------------------------------------------------------------------
(Percent Change vs. Year Ago)*
Volume Volume
With Without
Acquisitions/ Acquisitions/ Foreign Net Sales
Divestitures Divestitures Exchange Price Mix/Other Growth
----------------- -------------- --------------- ---------- --------------- ----------
Beauty Care 2 % 2 % 0 % 3% -3 % 2 %
Grooming 1 % 1 % -1 % 2% -1 % 1 %
Health Care 1 % 0 % 0 % 3% -1 % 3 %
Fabric Care and Home Care -1 % -1 % 0 % 5% -1 % 3 %
Baby Care and Family Care 1 % 1 % 0 % 5% 0 % 6 %
------ ---- ------ ------ ------ - -------- ------ - ---- ----
Total Company 0 % 0 % 0 % 4% -1 % 3 %
* These sales percentage changes are approximations based on
quantitative formulas that are consistently applied.
SOURCE: The Procter & Gamble Company
P&G Media Contacts:
Paul Fox, 513-983-3465
Jennifer Chelune, 513-983-2570
or
P&G Investor Relations Contact:
John Chevalier, 513-983-9974
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