• Share
  • Email
  • Embed
  • Like
  • Save
  • Private Content
Procter & Gamble Company at Barclays Capital Back-To-School Consumer Conference
 

Procter & Gamble Company at Barclays Capital Back-To-School Consumer Conference

on

  • 2,971 views

 

Statistics

Views

Total Views
2,971
Views on SlideShare
2,970
Embed Views
1

Actions

Likes
1
Downloads
138
Comments
0

1 Embed 1

http://www.e-presentations.us 1

Accessibility

Upload Details

Uploaded via as Adobe PDF

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

    Procter & Gamble Company at Barclays Capital Back-To-School Consumer Conference Procter & Gamble Company at Barclays Capital Back-To-School Consumer Conference Document Transcript

    • Barclay’s Back-to-School Conference September 10, 2009
    • Agenda 1. Strategy Renewal 2. Sources of Financial Flexibility 3. Rx Divestiture & Guidance P&G Growth Strategy Began Year Ago with Focus on Purpose We will provide branded products and services of superior quality and value that improve the lives of the world’s consumers, now and for generations to come. As a result, consumers will reward us with leadership sales, profit and value creation, allowing our people, our shareholders, and the communities in which we live and work to prosper. P&G Objectives •Win the Consumer Value Equation at the First and Second Moments of Truth with Purpose-Inspired, Benefit-Driven Brands •Build Shareholder Value
    • In-Touch with Reality P&G Growth Has Trailed Competitive Averages 10% P&G vs. Peer Group P&G 8% Competitive Average 6% 4% 2% 0% OND 04 OND 07 OND 08 OND 05 OND 06 JFM 05 JFM 06 JFM 08 JFM 09 JFM 07 JFM 04 AMJ 09 AMJ 04 AMJ 05 AMJ 07 AMJ 08 AMJ 06 JAS 04 JAS 06 JAS 07 JAS 08 JAS 05 -2% Focus on Long-Term Growth Maintaining Sense of Urgency FY 10 Objectives FY ‘10 • Grow value share--profitably • Deliver better consumer value • Accelerate productivity and drive simplification • Manage cost & cash with discipline Strategy Renewal Preserve and Strengthen What is Working • Growth strategies and core strengths • Billion-dollar and half-billion-dollar brands • Innovation • Emerging markets • Productivity and simplification • Cash and cost discipline • P&G people and partners
    • Strategy Renewal Lead Change Where We Can Create Greater Capability and Competitive Advantage • Focus even more on winning with consumers in emerging markets • Become a better, more integrated brand-building company • Become even more networked inside and outside the company • Become a flatter, faster and simpler organization Strategy Renewal Continuity with Change Where to Play How to Win 1 Grow leading, global brands and core categories 1 Drive Core P&G Strengths Build our business with 2 underserved and un-served consumers 2 Simplify, Scale and Execute Continue to develop faster 3 growing, structurally attractive businesses with 3 Lead Change global leadership potential
    • More Consumers Global Population Growth 2014/15 5 billion 2009/10 consumers 4 billion consumers Billions 1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050 Improving Consumer Value Reaching More Consumers At Multiple Price Points Super Premium & Premium Tiers Value Tier More Consumers Vertical Portfolio – Premium
    • More Consumers Vertical Portfolio – Value Tier More value tier products in core categories in top markets ~50% FY’09 FY’10 FY’11 Value Tier Key Brand / Country Combinations Company Source: Top 17 category, Top 15 country combinations. 14 More Consumers Vertical Portfolio Always +100% Infinity Always +25% • >$200MM Annual Sales Naturella in 5 years Base • Sold in 30 Countries More Consumers Vertical Portfolio Pampers Germany >60%Market Share United Kingdom France Switzerland Austria Greece
    • More Consumers Vertical Portfolio China Hair Herbal Before Essences Super Premium Price Index Premium Mid Low More Consumers Vertical Portfolio China Hair Herbal After Essences Super Premium Price Index Premium Mid Low More Parts of the World White Space Expansion +17% 2-year growth FY’09 FY’10 FY’11 Core Category / Key Country Combinations Company Source: Top 17 category, Top 15 country combinations.
    • More Parts of the World White Space Expansion India Value share leader More Parts of the World White Space Expansion India 6% 2X Share Anti- Aging More Parts of the World White Space Expansion R$8.00 R$3.50 R$2.90 R$1.99
    • More Parts of the World White Space Expansion 4 point value share lead Brazil Toothbrush P&G 32.0 Value Share 31.0 30.0 29.0 Oral B Toothpaste Launch March 2009 Primary 28.0 Competitor 27.0 JA2007 SO2007 ND2007 JF2008 MA2008 MJ2008 JA2008 SO2008 ND2008 JF2009 MA2009 MJ2009 More Parts of the World White Space Expansion – Brand X Today U.S. UK Belgium Japan Canada France Austria S. Korea Chile Germany Switzerland Malaysia Australia New Zealand 14 Countries 23 More Parts of the World White Space Expansion – Brand X FY’12 U.S. Argentina UK Belgium Poland Slovenia Japan Canada Columbia France Austria Romania Russia S. Korea Chile Venezuela Germany Switzerland Czech Republic Slovakia Malaysia Brazil Greece Italy Hungary Australia Mexico Iberia Croatia New Zealand Holland Asia 1 Singapore China 1 34 Countries 24
    • More Parts of the World Consumers Served by P&G 2014/15 ~5 billion 6 consumers 5 4 3 2 1 2007 2010 2015 2001 2002 2008 2009 2011 2012 2013 2003 2004 2005 2006 2014 # P&G Product Users (Billions) More Parts of the World Per Capita Spending 120 ~$110 2009/10 2014/15 100 Global Per Global Per Capita Capita ~$85 Spending Spending ~$12 ~$14 80 60 ~$45 40 ~$20 20 ~$3 <$0.6 0 US UK Germany Mexico China India More Parts of the World Per Capita Spending 120 ~$110 100 ~$85 80 60 $40B ~$45 40 ~$20 20 0 US UK Germany Mexico China India
    • More Completely Horizontal Innovation Fabric Enhancers More Completely Horizontal Innovation New Product Forms More Completely Horizontal Innovation Laundry Additives North America Western Europe
    • More Consumers More Parts of the World More Completely P7Y CAGR = 15% #1 mass facial skin care brand in the world How to Win Choices 1.Drive Core P&G Strengths in consumer understanding, innovation, branding Innovation and go-to-market Consumer Go-to- Branding Understanding Market Scale Consumer Understanding A Greater Focus on Value Prioritize Prioritize Performance Price Experiential Quality Simplicity Price
    • Consumer Understanding A Greater Focus on Value Prioritize Performance Prioritize Price ~50% ~50% Experiential Quality Simplicity Price Consumer Understanding A Greater Focus on Value Prioritize Performance Prioritize Price ~45% ~55% Experiential Quality Simplicity Price We Create Value with Innovation • Stimulates growth • Reduces costs • Primary driver of value
    • Innovation Stepping Up Investments +30% 30% more innovation in core categories in key countries FY’09 FY’10 Company Source: Top 17 category, Top 15 country combinations. Communicating Consumer Value Performance Based Value Messaging • >100 Performance Based Value Messages in Market • 97% of brands have Performance Based Value Messaging How to Win Choices 2. Simplify, Scale and Execute for competitive advantage •Elevating simplification, scale and execution to How to Win strategies •Faster, fewer, bigger initiatives •Collaborate across businesses, functions and regions on plans to win in market •Cascading priorities from strategy to work plans
    • Simplification Brand Agency Leader Before After Global Strategic Comm Planning ER Agency ER PR Mgr Agency Interactive Agency Digital Mgr P&G BRAND Interactive Brand Brand ADD Agency ADVERTISING Media Agency Franchise AGENCY Design FMOT Leader Leader FMOT Mgr Global Strategic Agency Mgr Comm Planning FMOT Agency Advertising Design Agency Agency Multiple competing messages Design Agency Scale Market Rewards Growth, Not Size Growth & Size Scale Cost Advantage Scale Drives Growth Multi-Brand Commercial Innovation “Official Locker Room Products of the NFL”
    • Scale Lowers Costs Intermodal Freight • Plan to cut total logistic costs by nearly 1 percent of sales Intermodal Usage: 10% 30% by 2015 (expect to reach 20% by end of CY 2010) • Few companies have scale necessary to fill an entire train. Lyon P&G does. Execution Raising The Bar In Key Areas 1 Qualified Copy 2 Efficient Assortment 3 In-Store Fundamentals 4 Centralized Resource Allocation How to Win Choices 3. Lead change to win with consumers and customers and create shareholder value • Renewed Leadership Team • Renewed Strategies • Investing in People & Technology • Operating with Urgency
    • P&G Objectives •Win the Consumer Value Equation at the First and Second Moments of Truth with Purpose-Inspired, Benefit-Driven Brands •Build Shareholder Value Sources of Financial Flexibility Foreign Commodities Exchange What’s Different? Media Interest Rates Expense Commodities $2.0 $2.0 $1.5 $1.0 Billions $0.5 FY’10 $0 FY’07 FY’08 FY’09 $1.0 -$1.0
    • FX Impacts FY’09 FY’10 $0 ($1B) ($2B) Sales Impact ($3B) ~$4 Billion ($4B) FX Sales Impact Versus Competitors 6.0% 4.0% 2.0% FX Impact to Sales 0.0% JAS’08 OND’08 JFM’09 AMJ’09 -2.0% Peer Group -4.0% -6.0% -8.0% P&G -10.0% Peer Group P&G FX Sales Impact Versus Competitors 6.0% Foreign 4.0% Multi- Nationals 2.0% FX Impact to Sales 0.0% JAS’08 OND’08 JFM’09 AMJ’09 -2.0% -4.0% -6.0% -8.0% P&G -10.0% Foreign Multi-Nationals P&G
    • Interest Expense $10.5 Billion of Bonds Coming Due in FY’10 Interest Expense FY’08 FY’09 FY’10 P&G’s AA- credit rating allows refinancing on attractive terms 53 Media Rates >10% Consumer Impressions FY’09 FY’10 Lower media rates will yield >10% more consumer impressions at roughly the same cost. Sources of Financial Flexibility Investment Year ~10% P&G Core EPS Growth P&G has Approximately $1 Billion of incremental financial flexibility on top ~1% of all the other items previously discussed FY’10 SGM
    • Sources of Relative Flexibility Differential EPS Expectations Peer Group^ P&G Core EPS Growth ~10% Several key competitors are committed to delivering significantly P&G higher EPS in FY’10 ~1% (^) – Estimated composite for Colgate, Clorox, Kimberly & Church & Dwight Fiscal 2010 Sources of Incremental Funding Differential EPS Expectation Commodities Interest Expense Media Rates Simplification Foreign Exchange Fiscal 2010 Uses of Incremental Funding Innovation Marketing Support Portfolio Expansion White Space Expansion Restructuring Consumer Value Interventions
    • Restructuring Folgers $400MM AT $300MM AT ‘06 ‘07 ‘08 ‘09 ‘10 Fiscal Year Improving Consumer Value Pricing FY’09 ~10% of Portfolio FY’10 $4bn Improving Consumer Value Competitive Merchandising Levels • Lowered average shelf prices in May ’09 • Volume has accelerated, share has improved on both brands
    • Improving Consumer Value Targeted Pricing Interventions • Targeted interventions on large size SKUs • Large size value and volume share is up >10% in July/August vs. May/June Improving Consumer Value Brand Repositioning • Cheer price reduction of approximately 13% • 2nd highest brand awareness after Tide • Consumer share of preference is 10%, vs. 3% value share Improving Consumer Value Developing Markets Fabric Care Home Care Russia Hair Care Fabric Care Saudi Hair Care Arabia Fabric Care Baby Care Feminine Care Turkey Oral Care
    • Disciplined Portfolio Management Pharmaceuticals Sale Disciplined Portfolio Management Focus on Consumer Health Care • Branded business • Attractive category • Advantaged by P&G’s core capabilities Disciplined Portfolio Management Acquisitions Divestitures
    • 1. Right Brands 2. Right People 3. Right Strategies 4. Right Choices Give Us Confidence Forward Looking Statement All statements, other than statements of historical fact included in this presentation, are forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995. Such statements are based on financial data, market assumptions and business plans available only as of the time the statements are made, which may become out of date or incomplete. We assume no obligation to update any forward-looking statement as a result of new information, future events or other factors. Forward-looking statements are inherently uncertain, and investors must recognize that events could differ significantly from our expectations. In addition to the risks and uncertainties noted in this presentation, there are certain factors that could cause actual results to differ materially from those anticipated by some of the statements made. These include: (1) the ability to achieve business plans, including growing existing sales and volume profitably despite high levels of competitive activity, especially with respect to the product categories and geographical markets (including developing markets) in which the Company has chosen to focus; (2) the ability to successfully manage ongoing acquisition and divestiture 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 designed to support our growth strategies, while successfully identifying, developing and retaining key employees; (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, competition law matters, and tax policy), and to resolve pending matters within current estimates; (7) the ability to successfully implement, achieve and sustain cost improvement plans in manufacturing and overhead areas, including the Company's outsourcing projects; (8) the ability to successfully manage currency (including currency issues in certain countries, such as Venezuela, China and India), debt, interest rate and commodity cost exposures and significant credit or liquidity issues; (9) the ability to manage continued global political and/or economic uncertainty and disruptions, especially in the Company's significant geographical markets, as well as any political and/or economic uncertainty and disruptions due to a global or regional credit crisis or terrorist and other hostile activities; (10) the ability to successfully manage competitive factors, including prices, promotional incentives and trade terms for products; (11) the ability to obtain patents and respond to technological advances attained by competitors and patents granted to competitors; (12) the ability to successfully manage increases in the prices of raw materials used to make the Company's products; (13) the ability to stay close to consumers in an era of increased media fragmentation; (14) the ability to stay on the leading edge of innovation and maintain a positive reputation on our brands; and 15) the ability to rely on and maintain key information technology systems. 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. Regulation G Disclosure For full reconciliation, visit: www.pg.com/investors