Procter & Gamble Company (the) · NYSE:PG
Procter & Gamble Company (the) — Barclays Global Consumer Conference 2017
60 slides from Procter & Gamble Company (the)'s conference presentation, Sep 7, 2017
Slide 1: Barclays Global Consumer Conference
Barclays Global Consumer Conference September 7, 2017
Slide 2: Forward Looking Statements
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,
Slide 3: Regulations FD and G Disclosure
Regulations FD and G Disclosure For a full reconciliation, please visit: www.pginvestor.com
Slide 4: Barclays Global Consumer Conference
Barclays Global Consumer Conference September 7, 2017
Slide 5: Fiscal Year 2017 Results – A Strong Year
Fiscal Year 2017 Results – A Strong Year Going-in Targets Results Organic Sales ~ 2% +2% mid-single Core EPS digits +7% Adjusted Free Cash Flow Productivity 90%+ 94%
Slide 6: Q4 2017 – A Strong Quarter
Q4 2017 – A Strong Quarter Q4 ‘17 FY ‘17 Organic Sales Growth +2% +2% Organic Volume Growth +2% +2% Core EPS Growth +8% +7% Adjusted Free Cash Flow Productivity 125% 94%
Slide 7: A Profoundly Different Company
A Profoundly Different Company Portfolio Strengthening Productivity + Daily Use Products that Solve Problems 4YR Operating Margin +270 bps | Profit per Employee +45% Supply Chain Transformation Organization -32% Roles
Slide 8: Portfolio Strengthening
Portfolio Strengthening 170 Brands Daily Use 16 Categories Products that Solve Problems
Slide 9: Driving Significant Productivity Improvement
Driving Significant Productivity Improvement + FY ’12 – FY ‘16 FY ’17 – FY ‘21 Roles -32% | Profit per Employee +45%
Slide 10: Market Conditions – Large FX Impacts
Market Conditions – Large FX Impacts $ Billion (BT) FY ‘13 FY ‘14 FY ‘15 FY ‘16 FY ‘17 Cumulative Sales Impact (1.9) (2.0) (4.4) (4.4) (1.3) ($14.0) % Sales Growth (2%) (3%) (6%) (6%) (2%) (19%) After Tax Profit (0.5) (1.0) (1.5) (1.0) (0.4) ($4.4) Impact % Earnings (4%) (9%) (14%) (9%) (4%) (44%) G
Slide 11: Driving Significant Productivity Improvement
Driving Significant Productivity Improvement $ Billion (BT) Foreign Exchange / Commodities 7.0 Wage Rate Inflation 1.0 Venezuela 0.6 Operating Margin Improvement 1.5 Total 10
Slide 12: P&G Margin Improvement
P&G Margin Improvement Constant Currency FY ‘13 FY ‘14 FY ‘15 FY ‘16 FY ‘17 Core EPS Growth +10% +14% Core EPS Growth +11% +7% +11% Core Gross Margin +50 bps +10 bps +90 bps +290 bps +60 bps Core Op. Margin +50 bps +150 bps +130 bps +240 bps +90 bps
Slide 13: P&G Margin Improvement
P&G Margin Improvement FY ‘13 FY ‘17 Core Gross Margin 48.8% 50.8% Versus 2012/13 +2.0% Constant Currency +4.5% Core Op. Margin 19.4% 22.1% Versus 2012/13 +2.7% Constant Currency +6.1%
Slide 14: P&G has Expanded its Industry-Leading Margins
P&G has Expanded its Industry-Leading Margins 30% Core Operating Margin 3rd 5% Interest Rates Among Highest in Peer Group the Most Favorable 4% 20% 3% 2% 10% 1% 0% 0% Tax Rate Among After Tax Profit Margin 40% Industry’s Lowest 20% 2nd Highest in Peer Group 30% 20% 10% 10% 0% 0%
Slide 15: Supply Chain Transformation
Supply Chain Transformation PRE-TRANSFORMATION END-STATE DESIGN
Slide 16: Organization – Simpler, Faster, Accountable
Organization – Simpler, Faster, Accountable 16 Business Units
Slide 17: Organization – Simpler, Faster, Accountable
Organization – Simpler, Faster, Accountable 16 Business Units x 6 Regions
Slide 18: Organization – Simpler, Faster, Accountable
Organization – Simpler, Faster, Accountable 16 Business Units x 6 Regions x Functions
Slide 19: Organization – Simpler, Faster, Accountable
Organization – Simpler, Faster, Accountable “The Thicket”
Slide 20: One Organizing Principle – Product Category
One Organizing Principle – Product Category “The Thicket” NEW Design “End-to-End” “Freedom in a 10 Categories Framework” Markets 70% of Sales 30% of Sales
Slide 21: A Profoundly Different Company
A Profoundly Different Company Portfolio Strengthening Productivity + Daily Use Products that Solve Problems 4YR Operating Margin +270 bps | Profit per Employee +45% Supply Chain Transformation Organization -32% Roles
Slide 22: Total Shareholder Return
Total Shareholder Return Balance Across Drivers BT Margin Free Cash Flow Sales Growth TSR Improvement Productivity CAGR bps/year % % High Margin 0% +200 bps 90%+ Target Growth High Sales +8% +0 bps 90%+ Target Growth Balanced Low to Growth Across 20-50 bps 90%+ Target Mid-singles 3 Drivers
Slide 23: A Profoundly Different Company
A Profoundly Different Company Research & Manufacturing Advertising & Office Legal Categories Brands Total Roles Development Platforms PR Agencies Buildings Entities Centers -25% -32% -50% -50% -50% -60% -60% -70%
Slide 24: Raising the Bar
Raising the Bar
Slide 25: Superiority – Raising the Bar
Superiority – Raising the Bar New Standard of Excellence Irresistibly Irresistibly Superior Superior Superior Consumer Superior Superior Brand In-Store & & Customer Products Packaging Communication Online Execution Value Equations
Slide 26: Raising the Bar – Product
Raising the Bar – Product Irresistibly Superior Products
Slide 27: Raising the Bar – Product
Raising the Bar – Product Unit Dose is driving Laundry Unit Dose U.S. Category Growth % of Laundry Category Growth from Unit Dose +90% +90% FY ‘17 Household Penetration 16% 23% 2016 2017
Slide 28: Raising the Bar – Product
Raising the Bar – Product Always Infinity/Radiant
Slide 29: Raising the Bar – Package
Raising the Bar – Package Irresistibly Superior Packaging
Slide 30: Raising the Bar – Package
Raising the Bar – Package Scent Beads
Slide 31: Raising the Bar – Market Growth
Raising the Bar – Market Growth U.S. Fabric Care Market Size Market 4x Mid-1970’s Current
Slide 32: Raising the Bar – Market Growth
Raising the Bar – Market Growth Global Diapers Market Size Market 11x Mid-1970’s Current
Slide 33: Raising the Bar – Communication
Raising the Bar – Communication Superior Brand Communication
Slide 34: Raising the Bar – Communication
Raising the Bar – Communication
Slide 35: Video - New #LikeAGirl Ad (1.2min)
Video 1 - New #LikeAGirl Ad (1.2min)
Slide 36: Raising the Bar – Communication
Raising the Bar – Communication
Slide 37: Raising the Bar – In-Store Execution
Raising the Bar – In-Store Execution Superior In-Store & Online Execution
Slide 38: Raising the Bar – Online Execution
Raising the Bar – Online Execution
Slide 39: Raising the Bar – eCommerce Sales Growth
Raising the Bar – eCommerce Sales Growth P&G vs. Market Country 1 140 Country 2 140 Country 3 110 Country 4 100 Country 5 120 Country 6 120 Country 7 110 Country 8 170
Slide 40: Raising the Bar – Value Equation
Raising the Bar – Value Equation Superior Consumer & Customer Value Equations
Slide 41: Raising the Bar
Raising the Bar New Standard of Excellence ~40% Passing Grade Irresistibly Irresistibly Superior Superior Superior Consumer Superior Superior Brand In-Store & & Customer Products Packaging Communication Online Execution Value Equations
Slide 42: Raising the Bar – Superior Propositions
Raising the Bar – Superior Propositions
Slide 43: Brand Equity
#1 BRANDS with Millennials BRAND EQUITY SCORES among Millennials
Slide 44: Top-line Momentum Drivers
Top-line Momentum Drivers Stimulate WIN the Point FIX CLEAN UP MARKET of Market Entry Existing Unattractive GROWTH SUPERIORITY Problems Business
Slide 45: China Diaper Market – Ending FY 2017
China Diaper Market – Ending FY 2017 Segment Category % Growth Sales Premium Taped +25% 35% Premium Pants +50% 10% Mid-tier Taped -10% 25% Mid-tier Pants +30% 15% Total Diapers +12%
Slide 46: China Diaper Market – Ending FY 2017
China Diaper Market – Ending FY 2017 Channel Channel % Growth Sales eCommerce +30% 45% Baby Stores +10% 35% Hyper/Super/Other -20% 20%
Slide 47: China Diaper Market – FY 2017
China Diaper Market – FY 2017 P&G % Sales vs. Market % Sales Premium Taped Pants (Premium/Mid-tier) eCommerce Baby Stores
Slide 48: Raising the Bar – China Baby
= DAWN Raising the Bar — China Baby _ — PANTENE Ga Gillette Fusion Pampers a wT AR RRRRR
Slide 49: Video - China Baby
Video 2 - China Baby
Slide 50: Walmart Baby Store Execution
Walmart Baby Store Execution Execution
Slide 51: Product Page Banner Search
Product Banner Search Page Ad Results
Slide 52: Early Progress on New Forms
Early Progress on New Forms July/August Sales Premium Taped +300 IYA Pants +250 IYA Baby stores +115 IYA eCommerce +300 IYA
Slide 53: Breadth of Progress in China
Breadth of Progress in China FY ‘16 FY ‘17 FY ‘18 +mid-single Sales Growth -5% +1% digits Categories Growing Sales (of 7) 1 5 7
Slide 54: Breadth of Progress across P&G
Breadth of Progress across P&G Holding/Growing Share Q4 ‘15 Q4 ‘17 # Top 20 Countries 2 11 # Top 20 Brands 10 14
Slide 55: Fueled by Productivity
Fueled by Productivity Productivity Investment Productivity Investment + Growth & Growth & Value Creation Value Creation FY ’12 – FY ‘16 FY ’17 – FY ‘21
Slide 56: Organization – Compensation Incentives
Organization – Compensation Incentives More Granular Incentives Increased Accountability
Slide 57: Organization and Culture
Organization and Culture
Slide 58: A Profoundly Different Company
A Profoundly Different Company Portfolio Strengthening Productivity + Daily Use Products that Solve Problems 4YR Operating Margin +270 bps | Profit per Employee +45% Supply Chain Transformation Organization -32% Roles
Slide 59: We’re On The Right Track
We’re On The Right Track FY 2017 Results – A Strong Year Total Shareholder Return Comparison since November 1, 2015 The peers selected by Trian in its July 17, 2017 Introductory Presentation are as follows: Beiersdorf, Church & Dwight, Clorox, Colgate-Palmolive, Edgewell Personal Care, Henkel, Kimbe
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