Net Sales Unchanged;
Organic Sales +3%; Diluted Net EPS $0.96, +5%; Core EPS $1.03,
+5%
The Procter & Gamble Company (NYSE:PG) reported first
quarter fiscal year 2017 net sales of $16.5 billion, unchanged
versus the prior year. Organic sales increased three percent.
Organic sales increased in all five business segments driven by
low-to-mid single digit organic volume growth in all segments.
Diluted net earnings per share were $0.96, an increase of five
percent versus the prior year. Core earnings per share were $1.03,
an increase of five percent versus the prior year. Currency-neutral
core EPS increased 12% versus the prior year. Reported operating
profit margin was unchanged. Core operating profit margin increased
20 basis points as improvement in core gross margin was partially
offset by an increase in core SG&A costs as a percent of net
sales.
Operating cash flow was $3.0 billion for the quarter. Free cash
flow productivity was 85%. The Company repurchased $1 billion of
common stock and returned $1.9 billion of cash to shareholders as
dividends.
“Our first quarter results mark a good start to the fiscal
year,” said Chairman, President and Chief Executive Officer David
Taylor. “We delivered broad-based organic sales growth improvement
across product categories and markets, as well as strong cost
savings. Earlier this month, we completed the last major step in
P&G’s portfolio transformation with the Beauty Brands
divestiture to Coty Inc. We are now focusing all our efforts on 10
large, structurally attractive categories where P&G holds
leading positions. We’re pleased with the progress we’re making,
but there is still more work to do to get back to the levels of
balanced top- and bottom-line growth and cash generation that will
consistently put P&G shareholder value creation among the best
in our industry.”
July - September Quarter Discussion
Net sales in the first quarter of fiscal year 2017 were $16.5
billion, unchanged versus prior year, including a negative three
percent impact from foreign exchange. Organic sales increased three
percent driven by a three percent increase in organic shipment
volume. All-in volume increased two percent including the impacts
of minor brand divestitures and lost sales to Venezuelan
subsidiaries.
July - September
2016
Foreign
Organic
Organic
Net Sales
Drivers*
Volume
Exchange
Price
Mix
Other**
Net
Sales
Volume
Sales
Beauty (2)% (2)% 1% 1% 1% (1)% 2% 3% Grooming —% (3)% 1% —% 1% (1)%
3% 3% Health Care 5% (3)% 1% 1% —% 4% 5% 7% Fabric & Home Care
2% (2)% (1)% 1% 1% 1% 4% 4% Baby, Feminine & Family Care
3% (3)% (1)% (1)% 1% (1)%
4% 2%
Total P&G 2%
(3)% —% —% 1%
—% 3% 3%
* Net sales percentage changes are approximations based on
quantitative formulas that are consistently applied.** Other
includes the sales mix impact of acquisitions/divestitures and
rounding impacts necessary to reconcile volume to net sales.
- Beauty segment organic sales increased
three percent versus year ago behind higher organic volume and
increased pricing in both Hair Care and Skin & Personal Care.
Organic sales increased in Skin & Personal Care due to the
continued strong growth of the super-premium SK-II brand. Hair Care
growth was driven by mid-single-digit organic sales growth on both
Pantene and Head & Shoulders which was partially offset by
declines of smaller brands.
- Grooming segment organic sales
increased three percent due to strong innovation-driven organic
volume growth in both Shave Care and Appliances. Organic sales
increased low single digits in Shave Care and mid-single digits in
Appliances.
- Health Care segment organic sales
increased seven percent driven by double-digit growth in Personal
Health Care from innovation and pricing. Oral Care organic sales
grew mid-single digits due to broad-based volume growth and
favorable product mix from power toothbrushes and pricing.
- Fabric & Home Care segment organic
sales increased four percent versus year ago driven by
mid-single-digit growth in both Fabric Care and Home Care. Fabric
Care organic sales growth was led by high single-digit growth in
developed markets behind product innovation and marketing
investments. Home Care delivered mid-single-digit organic sales
growth in developed and developing markets behind the expansion of
product innovation.
- Baby, Feminine & Family Care
segment organic sales increased two percent driven by
mid-single-digit organic volume growth in all three businesses.
Baby Care organic sales increased low single digits behind market
growth, product innovation and consumer value corrections. Feminine
Care organic sales increased low single digits behind
mid-single-digit volume growth in both developed and developing
markets. Family Care organic sales increased low single digits
driven by new product innovation.
Diluted net earnings per share from continuing operations were
$1.00, an increase of four percent over the base period. Diluted
net earnings per share were $0.96, an increase of five percent
versus the prior year. Current year results included a $0.04 per
share loss from discontinued operations and non-core restructuring
costs of $0.03 per share. Core earnings per share, which exclude
non-core restructuring charges and the results of discontinued
operations, were $1.03, an increase of five percent versus the
prior year. Excluding the impact of foreign exchange,
currency-neutral core earnings per share increased 12% for the
quarter.
Reported gross margin increased 30 basis points, including a 20
basis point increase in non-core restructuring charges. Core gross
margin improved 50 basis points, including 80 basis points of
negative foreign exchange impacts. On a currency-neutral basis,
core gross margin increased 130 basis points, driven by 190 basis
points of productivity cost savings and 20 basis points of volume
growth leverage. These benefits more than offset headwinds from
unfavorable mix, innovation and capacity investments and commodity
cost increases.
Selling, general and administrative expense (SG&A) as a
percent of sales increased 20 basis points on a reported basis
versus the prior year, including a 10 basis point net benefit from
a year-on-year decline in non-core restructuring charges. Core
SG&A as a percentage of sales increased 40 basis points,
including 30 basis points of unfavorable foreign exchange impacts.
On a currency-neutral basis, core SG&A was up 10 basis points
versus the prior year as increased advertising and sampling
investments were partially offset by productivity savings in
overhead and marketing costs.
Reported operating profit margin was unchanged. Core operating
profit margin increased 20 basis points versus the prior year,
including 100 basis points of foreign exchange impacts. On a
currency-neutral basis, core operating profit margin increased 120
basis points driven by productivity cost savings of 270 basis
points for the quarter.
Fiscal Year 2017 Guidance
P&G said it is maintaining its projection for organic sales
growth of approximately two percent for fiscal 2017. The Company
expects the combined headwinds of foreign exchange and minor brand
divestitures to reduce sales growth by about one percentage point.
As a result, P&G continues to estimate all-in sales growth of
about one percent for fiscal 2017.
The Company also maintains its expectation for core earnings per
share growth of mid-single digits versus fiscal 2016 core EPS of
$3.67. All-in GAAP earnings per share are expected to increase 45%
to 50% versus fiscal year 2016 GAAP EPS of $3.69. The fiscal 2017
GAAP EPS estimate includes approximately $0.10 per share of
non-core restructuring costs and $0.13 per share of charges related
to early debt retirement that was initiated earlier this month.
Also included in GAAP EPS is a significant gain from the
divestiture of 41 beauty brands to Coty Inc. The exact earnings
gain from the transaction with Coty, which closed October 1, 2016,
will be reported in the second quarter results.
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,” “expect,” “anticipate,” “estimate,” “intend,”
“strategy,” “future,” “opportunity,” “plan,” “may,” “should,”
“will,” “would,” “will be,” “will continue,” “will likely result,”
and similar expressions. Forward-looking statements are based on
current expectations and assumptions, which are subject to risks
and uncertainties that may cause results to differ materially from
those expressed or implied in 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, without limitation: (1) the ability to
successfully manage global financial risks, including foreign
currency fluctuations, currency exchange or pricing controls and
localized volatility; (2) the ability to successfully manage local,
regional or global economic volatility, including reduced market
growth rates, and generate sufficient income and cash flow to allow
the Company to effect the expected share repurchases and dividend
payments; (3) the ability to manage disruptions in credit markets
or changes to our credit rating; (4) the ability to maintain key
manufacturing and supply arrangements (including sole supplier and
sole manufacturing plant arrangements) and manage disruption of
business due to factors outside of our control, such as natural
disasters and acts of war or terrorism; (5) the ability to
successfully manage cost fluctuations and pressures, including
commodity prices, raw materials, labor costs, energy costs and
pension and health care costs; (6) the ability to stay on the
leading edge of innovation, obtain necessary intellectual property
protections and successfully respond to technological advances
attained by, and patents granted to, competitors; (7) the ability
to compete with our local and global competitors in new and
existing sales channels, including by successfully responding to
competitive factors such as prices, promotional incentives and
trade terms for products; (8) the ability to manage and maintain
key customer relationships; (9) the ability to protect our
reputation and brand equity by successfully managing real or
perceived issues, including concerns about safety, quality,
ingredients, efficacy or similar matters that may arise; (10) the
ability to successfully manage the financial, legal, reputational
and operational risk associated with third party relationships,
such as our suppliers, contractors and external business partners;
(11) the ability to rely on and maintain key information technology
systems and networks (including Company and third-party systems and
networks) and maintain the security and functionality of such
systems and networks and the data contained therein; (12) the
ability to successfully manage regulatory and legal requirements
and matters (including, without limitation, those laws and
regulations involving product liability, intellectual property,
antitrust, privacy, tax, accounting standards and environmental)
and to resolve pending matters within current estimates; (13) the
ability to manage changes in applicable tax laws and regulations;
(14) the ability to successfully manage our portfolio optimization
strategy, as well as ongoing acquisition, divestiture and joint
venture activities, to achieve the Company’s overall business
strategy, without impacting the delivery of base business
objectives; (15) the ability to successfully achieve productivity
improvements and cost savings and manage ongoing organizational
changes, while successfully identifying, developing and retaining
particularly key employees, especially in key growth markets where
the availability of skilled or experienced employees may be
limited; and (16) the ability to manage the uncertain implications
of the United Kingdom’s withdrawal from the European Union. For
additional information concerning factors that could cause actual
results and events to differ materially from those projected
herein, please refer to our most recent 10-K, 10-Q and 8-K
reports.
About Procter & Gamble
P&G serves consumers around the world with one of the
strongest portfolios of trusted, quality, leadership brands,
including Always®, Ambi Pur®, Ariel®, Bounty®, Charmin®, Crest®,
Dawn®, Downy®, Fairy®, Febreze®, Gain®, Gillette®, Head &
Shoulders®, Lenor®, Olay®, Oral-B®, Pampers®, Pantene®, SK-II®,
Tide®, Vicks®, and Whisper®. The P&G community includes
operations in approximately 70 countries worldwide.
Please visit http://www.pg.com for the latest news and
information about P&G and its brands.
THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES
(Amounts in Millions Except Per Share Amounts)
Consolidated
Earnings Information Three Months Ended
September 30 2016 2015 % Chg
NET SALES $ 16,518 $ 16,527 — % COST OF PRODUCTS SOLD 8,102
8,152 (1 )%
GROSS PROFIT 8,416 8,375 — %
SELLING, GENERAL AND ADMINISTRATIVE EXPENSE 4,645 4,607
1 %
OPERATING INCOME 3,771 3,768 — % INTEREST EXPENSE
131 140 (6 )% INTEREST INCOME 35 44 (20 )% OTHER NON-OPERATING
INCOME/(LOSS), NET 63 (18 ) N/A
EARNINGS FROM CONTINUING
OPERATIONS BEFORE INCOME TAXES 3,738 3,654 2 % INCOME TAXES ON
CONTINUING OPERATIONS 863 877 (2 )%
NET EARNINGS
FROM CONTINUING OPERATIONS 2,875 2,777 4 %
NET
EARNINGS/(LOSS) FROM DISCONTINUED OPERATIONS (118 ) (142 ) N/A
NET EARNINGS 2,757 2,635 5 % LESS: NET
EARNINGS ATTRIBUTABLE TO NONCONTROLLING INTERESTS 43 34
26 %
NET EARNINGS ATTRIBUTABLE TO PROCTER &
GAMBLE $ 2,714 $ 2,601 4 % EFFECTIVE TAX
RATE 23.1 % 24.0 %
BASIC NET EARNINGS PER COMMON
SHARE:* EARNINGS FROM CONTINUING OPERATIONS $ 1.03 $ 0.98 5 %
EARNINGS/(LOSS) FROM DISCONTINUED OPERATIONS $ (0.04 ) $ (0.05 )
N/A BASIC NET EARNINGS PER COMMON SHARE $ 0.99 $ 0.93
6 %
DILUTED NET EARNINGS PER COMMON SHARE:* EARNINGS FROM
CONTINUING OPERATIONS $ 1.00 $ 0.96 4 % EARNINGS/(LOSS) FROM
DISCONTINUED OPERATIONS $ (0.04 ) $ (0.05 ) N/A DILUTED NET
EARNINGS PER COMMON SHARE $ 0.96 $ 0.91 5 % DIVIDENDS
PER COMMON SHARE $ 0.6700 $ 0.6630 DILUTED WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING 2,822.9 2,867.5
COMPARISONS AS A % OF
NET SALES Basis Pt Chg GROSS MARGIN 51.0% 50.7% 30
SELLING, GENERAL AND ADMINISTRATIVE EXPENSE 28.1% 27.9% 20
OPERATING MARGIN 22.8% 22.8% — EARNINGS FROM CONTINUING OPERATIONS
BEFORE INCOME TAXES 22.6% 22.1% 50 NET EARNINGS FROM CONTINUING
OPERATIONS 17.4% 16.8% 60 NET EARNINGS ATTRIBUTABLE TO PROCTER
& GAMBLE 16.4% 15.7% 70
* Basic net earnings per common share and Diluted net earnings
per common share are calculated on Net earnings attributable to
Procter & Gamble.
THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES
(Amounts in Millions)
Consolidated Earnings Information Three
Months Ended September 30, 2016 % Change
Earnings/(Loss) from % Change Net
Earnings/(Loss) % Change Versus Year
Continuing Operations Versus Year from
Continuing Versus Year Net Sales
Ago Before Income Taxes Ago Operations
Ago Beauty $ 2,996 (1 )% $ 783 (5 )% $ 592 (5 )%
Grooming 1,658 (1 )% 529 6 % 415 6 % Health Care 1,861 4 % 496 11 %
320 1 % Fabric & Home Care 5,302 1 % 1,129 1 % 728 (3 )% Baby,
Feminine & Family Care 4,595 (1 )% 1,045 (6 )% 697 (7 )%
Corporate 106 (1 )% (244 ) N/A 123 N/A
Total
Company $ 16,518 — %
$ 3,738 2 % $
2,875 4 % Three Months
Ended September 30, 2016 (Percent Change vs. Year Ago)*
Volume with Volume Excluding
Acquisitions & Acquisitions
& Foreign Net Sales Divestitures
Divestitures Exchange Price Mix
Other** Growth Beauty (2)% 2% (2)% 1% 1% 1% (1)%
Grooming —% 3% (3)% 1% —% 1% (1)% Health Care 5% 5% (3)% 1% 1% —%
4% Fabric & Home Care 2% 4% (2)% (1)% 1% 1% 1% Baby, Feminine
& Family Care 3% 4% (3)% (1)% (1)%
1% (1)%
Total Company 2%
3% (3)% —% —%
1% —%
* Net Sales percentage changes are approximations based on
quantitative formulas that are consistently applied.** Other
includes the sales mix impact of acquisitions/divestitures and
rounding impacts necessary to reconcile volume to net sales.
THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES
(Amounts in Millions Except Per Share
Amounts)
Consolidated Statements of Cash Flows Three
Months Ended September 30 2016 2015
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD $ 7,102 $
6,836
OPERATING ACTIVITIES NET EARNINGS 2,757 2,635
DEPRECIATION AND AMORTIZATION 728 731 SHARE-BASED COMPENSATION
EXPENSE 44 67 DEFERRED INCOME TAXES (177 ) 89 GAIN ON SALE OF
BUSINESSES (75 ) (7 ) GOODWILL AND INTANGIBLE ASSET IMPAIRMENT
CHARGES — 402 CHANGES IN: ACCOUNTS RECEIVABLE (424 ) (368 )
INVENTORIES (287 ) (519 ) ACCOUNTS PAYABLE, ACCRUED AND OTHER
LIABILITIES 298 298 OTHER OPERATING ASSETS & LIABILITIES 135
141 OTHER 26 69
TOTAL OPERATING ACTIVITIES
3,025 3,538
INVESTING ACTIVITIES CAPITAL
EXPENDITURES (684 ) (532 ) PROCEEDS FROM ASSET SALES 183 38
ACQUISITIONS, NET OF CASH ACQUIRED (14 ) — PURCHASES OF SHORT-TERM
INVESTMENTS (631 ) (494 ) PROCEEDS FROM SALES OF SHORT-TERM
INVESTMENTS 243 418 CASH TRANSFERRED TO DISCONTINUED BEAUTY BRANDS
BUSINESS (348 ) — RESTRICTED CASH RELATED TO BEAUTY BRANDS
DIVESTITURE (874 ) — CHANGE IN OTHER INVESTMENTS 4 24
TOTAL INVESTING ACTIVITIES (2,121 ) (546 )
FINANCING
ACTIVITIES DIVIDENDS TO SHAREHOLDERS (1,851 ) (1,865 ) CHANGE
IN SHORT-TERM DEBT 1,519 450 ADDITIONS TO LONG-TERM DEBT 891 —
REDUCTIONS OF LONG-TERM DEBT (1,001 ) (537 ) TREASURY STOCK
PURCHASES (1,002 ) (502 ) IMPACT OF STOCK OPTIONS AND OTHER 937
483
TOTAL FINANCING ACTIVITIES (507 ) (1,971 )
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS
(43 ) (152 )
CHANGE IN CASH AND CASH EQUIVALENTS 354
869
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 7,456
$ 7,705
THE PROCTER & GAMBLE COMPANY
AND SUBSIDIARIES
(Amounts in Millions Except Per Share
Amounts)
Condensed Consolidated Balance Sheets
September 30, 2016 June 30, 2016 CASH AND CASH
EQUIVALENTS $ 7,456 $ 7,102 RESTRICTED CASH 1,870 —
AVAILABLE-FOR-SALE INVESTMENTS SECURITIES 6,615 6,246 ACCOUNTS
RECEIVABLE 4,713 4,373 INVENTORIES 4,999 4,716 DEFERRED INCOME
TAXES — 1,507 PREPAID EXPENSES AND OTHER CURRENT ASSETS 2,447 2,653
CURRENT ASSETS HELD FOR SALE 7,071 7,185
TOTAL CURRENT
ASSETS 35,171 33,782 PROPERTY, PLANT AND EQUIPMENT, NET 19,310
19,385 GOODWILL 44,458 44,350 TRADEMARKS AND OTHER INTANGIBLE
ASSETS, NET 24,429 24,527 OTHER NONCURRENT ASSETS 5,675
5,092
TOTAL ASSETS $ 129,043 $ 127,136
ACCOUNTS PAYABLE $ 9,024 $ 9,325 ACCRUED AND OTHER LIABILITIES
8,032 7,449 CURRENT LIABILITIES HELD FOR SALE 3,130 2,343 DEBT DUE
WITHIN ONE YEAR 12,215 11,653
TOTAL CURRENT
LIABILITIES 32,401 30,770 LONG-TERM DEBT 18,910 18,945 DEFERRED
INCOME TAXES 8,515 9,113 OTHER NONCURRENT LIABILITIES 10,266
10,325
TOTAL LIABILITIES 70,092 69,153
TOTAL
SHAREHOLDERS' EQUITY 58,951 57,983
TOTAL LIABILITIES
AND SHAREHOLDERS' EQUITY $ 129,043 $ 127,136
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 Procter &
Gamble's October 25, 2016 earnings release and the
reconciliation to the most closely related GAAP measure. We believe
that these measures provide useful perspective of underlying
business trends (i.e. trends excluding non-recurring or unusual
items) and results and provide a supplemental measure of
year-on-year results. The non-GAAP measures described below are
used by Management in making operating decisions, allocating
financial resources and for business strategy purposes. These
measures may be useful to investors as they provide supplemental
information about business performance and provide investors a view
of our business results through the eyes of management. These
measures are also used to evaluate senior management and are a
factor in determining their at-risk compensation. These non-GAAP
measures are not intended to be considered by the user in place of
the related GAAP measure, but rather as supplemental information to
our business results. These non-GAAP measures may not be the same
as similar measures used by other companies due to possible
differences in method and in the items or events being
adjusted.
The Core earnings measures included in the following
reconciliation tables refer to the equivalent GAAP measures
adjusted as applicable for the following items:
Incremental restructuring: The
Company has and continues to have an ongoing level of restructuring
activities. Such activities have resulted in ongoing annual
restructuring related charges of approximately $250 - $500 million
before tax. Beginning in 2012 Procter & Gamble began a $10
billion strategic productivity and cost savings initiative that
includes incremental restructuring activities. This results in
incremental restructuring charges to accelerate productivity
efforts and cost savings. The adjustment to Core earnings includes
only the restructuring costs above what we believe are the normal
recurring level of restructuring costs.
We do not view the above item to be part of our sustainable
results and its exclusion from Core earnings measures provides a
more comparable measure of year-on-year results.
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. Management believes this measure
provides investors with a supplemental understanding of underlying
sales trends by providing sales growth on a consistent basis, and
this measure is used in assessing achievement of management goals
for at-risk compensation.
Core operating profit margin: Core
operating profit margin is a measure of the Company's operating
margin adjusted for items as indicated. Management believes this
non-GAAP measure provides a supplemental perspective to the
Company’s operating efficiency over time.
Core gross margin: Core gross
margin is a measure of the Company's gross margin adjusted for
items as indicated. Management believes this non-GAAP measure
provides a supplemental perspective to the Company’s operating
efficiency over time.
Core EPS and currency-neutral Core
EPS: Core earnings per share, or Core EPS, is a measure of
the Company's diluted net earnings per share from continuing
operations adjusted as indicated. Currency-neutral Core EPS is a
measure of the Company's Core EPS excluding the incremental current
year impact of foreign exchange. Management views these non-GAAP
measures as a useful supplemental measure of Company performance
over time.
Free cash flow: Free cash flow is
defined as operating cash flow less capital spending. Free cash
flow represents the cash that the Company is able to generate after
taking into account planned maintenance and asset expansion.
Management views 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.
Free cash flow productivity: Free
cash flow productivity is defined as the ratio of free cash flow to
net earnings. Management views free cash flow productivity as a
useful measure to help investors understand P&G’s ability to
generate cash. Free cash flow productivity is used by management in
making operating decisions, allocating financial resources and for
budget planning purposes. The Company's long-term target is to
generate annual free cash flow productivity at or above 90
percent.
THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES (Amounts
in Millions Except Per Share Amounts) Reconciliation of Non-GAAP
Measures
Three Months Ended September 30, 2016
AS REPORTED DISCONTINUED
INCREMENTAL NON-GAAP (GAAP)
OPERATIONS RESTRUCTURING ROUNDING
(CORE) COST OF PRODUCTS SOLD 8,102 — (111 ) — 7,991
GROSS PROFIT 8,416 — 111 — 8,527
GROSS MARGIN 51.0 %
— % 0.7 % (0.1 )% 51.6 %
SELLING, GENERAL, AND ADMINISTRATIVE
EXPENSE 4,645 — 23 (1 ) 4,667
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSE AS A % OF NET SALES 28.1 % — % 0.1 % 0.1
% 28.3 %
OPERATING INCOME 3,771 — 88 1 3,860
OPERATING
PROFIT MARGIN 22.8 % — % 0.5 % 0.1 % 23.4 %
INCOME TAX ON
CONTINUING OPERATIONS 863 — 15 1 879
NET EARNINGS
ATTRIBUTABLE TO P&G 2,714 118 73 — 2,905
EFFECTIVE TAX
RATE 23.1 % — % (0.1 )% — % 23.0 %
Core EPS:
DILUTED NET EARNINGS PER COMMON SHARE* 0.96
0.04 0.03 — 1.03
CURRENCY IMPACT TO CORE EARNINGS 0.07 CURRENCY-NEUTRAL CORE
EPS 1.10
* Diluted net earnings per share are calculated on Net earnings
attributable to Procter & Gamble.
CHANGE VERSUS YEAR AGO CORE
GROSS MARGIN 50 BPS CORE SELLING GENERAL & ADMINISTRATIVE
EXPENSE AS A % OF NET SALES 40 BPS CORE OPERATING PROFIT MARGIN 20
BPS CORE EFFECTIVE TAX RATE (90 ) BPS CORE EPS 5 % CURRENCY-NEUTRAL
CORE EPS 12 % THE PROCTER & GAMBLE COMPANY AND
SUBSIDIARIES (Amounts in Millions Except Per Share Amounts)
Reconciliation of Non-GAAP Measures
Three Months Ended
September 30, 2015 AS REPORTED
DISCONTINUED INCREMENTAL
NON-GAAP (GAAP) OPERATIONS
RESTRUCTURING ROUNDING (CORE) COST OF
PRODUCTS SOLD 8,152 — (72 ) — 8,080
GROSS PROFIT 8,375 —
72 — 8,447
GROSS MARGIN 50.7 % — % 0.4 % — % 51.1 %
SELLING, GENERAL, AND ADMINISTRATIVE EXPENSE 4,607 — — —
4,607
SELLING, GENERAL AND ADMINISTRATIVE EXPENSE AS A % OF NET
SALES 27.9 % — % — % — % 27.9 %
OPERATING INCOME 3,768 —
72 — 3,840
OPERATING PROFIT MARGIN 22.8 % — % 0.4 % — % 23.2
%
INCOME TAX ON CONTINUING OPERATIONS 877 — 14 1 892
NET
EARNINGS ATTRIBUTABLE TO P&G 2,601 142 58 (1 ) 2,800
EFFECTIVE TAX RATE 24.0 % — % (0.1 )% — % 23.9 %
Core EPS:
DILUTED NET EARNINGS PER COMMON SHARE* 0.91
0.05 0.02 — 0.98
* Diluted net earnings per share are calculated on Net earnings
attributable to Procter & Gamble.
Organic sales
growth:
Foreign
Exchange
Acquisition/Divestiture
Organic
Sales
July - September
2016
Net Sales
Growth
Impact
Impact*
Growth
Beauty (1)% 2% 2% 3% Grooming (1)% 3% 1% 3% Health Care 4% 3% —% 7%
Fabric & Home Care 1% 2% 1% 4% Baby, Feminine & Family Care
(1)% 3% —% 2%
Total P&G —% 3%
—% 3%
Combined Foreign
Exchange &
Organic
Sales
Total
P&G
Net Sales
Growth
Acquisition/Divestiture Impact*
Growth
FY 2017 (Estimate) 1% 1%
2%
* Acquisition/Divestiture Impact includes the mix impacts of
acquisitions and divestitures and rounding impacts necessary to
reconcile net sales to organic sales.
Core EPS:
Diluted
EPS
Total
P&G
Growth
Impact of
Incremental Non-Core Items*
Core EPS
Growth
FY 2017 Up mid-single (Estimate) Up 45% to 50%
(41%) to (44%) digits
* Includes change in discontinued operations (includes
anticipated gain on sale of Beauty Brands).
Free cash flow and
free cash flow productivity (dollar amounts in
millions):
Three Months Ended September 30, 2016
Free Cash
Flow
Operating Cash
Flow
Capital
Spending
Free Cash
Flow
Net
Earnings
Productivity
$3,025 $(684)
$2,341 $2,757 85%
View source
version on businesswire.com: http://www.businesswire.com/news/home/20161025005851/en/
P&G Media
Contacts:Damon Jones, 513-983-0190Jennifer Corso,
513-983-2570orP&G Investor Relations
Contact:John Chevalier, 513-983-9974
Procter and Gamble (NYSE:PG)
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From Mar 2024 to Apr 2024
Procter and Gamble (NYSE:PG)
Historical Stock Chart
From Apr 2023 to Apr 2024