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Procter & Gamble Co PG
Q3 2013 Earnings Call Transcript

Transcript Call Date 04/24/2013

Operator: Welcome to Procter & Gamble's Quarter End Conference Call. Today's discussion will include a number of forward-looking statements. If you will refer to P&G's most recent 10-K, 10-Q, and 8-K reports, you will see a discussion of factors that could cause the Company's actual results to differ materially from these projections.

As required by Regulation G, P&G needs to make you aware that during the call the Company will make a number of references to non-GAAP and other financial measures. Management believes these measures provide investors valuable information on the underlying growth trends of the business.

Organic refers to reported results excluding the impacts of acquisitions and divestitures and foreign exchange where applicable. Adjusted free cash flow represents operating cash flow less capital expenditures and adjusted for after-tax impacts of major divestures. Adjusted Free cash flow productivity is the ratio of adjusted free cash flow to net earnings excluding divesture gains. Any measure described as Core refers to the equivalent GAAP measure adjusted for certain items. P&G has posted on its website www.pg.com a full reconciliation of non-GAAP and other financial measures.

Now, I will turn the call over to P&G's Chief Financial Officer, Jon Moeller.

Jon R. Moeller - CFO: Thanks. Good morning, everyone. I am here with this morning with Bob McDonald and Teri List-Stoll. Our third quarter results were on track with our plan on the topline. Market share showed broad-based improvement and strengthened as the quarter progressed and we're ahead of plan on operating profit, earnings per share and cash flow. We announced an increase in our dividend and we're increasing our share repurchase projection on this call to the top-end of our target range.

In the March quarter, organic sales grew 3%. Sales came in at the lower end of the guidance range, due in part to slower market growth. Underlying global market growth was choppy month-to-month and was down about half a point in the March quarter versus the December quarter. Organic volume grew 2% as pricing added one point to organic sales growth. Product and geographic mix was neutral to sales growth.

Foreign exchange impacts lowered sales growth by one point resulting in all-in sales growth of 2%. Global market share trends have continued to improve. We held or grew market share in businesses representing over 50% of sales in the March quarter, with third consecutive quarter-to-quarter improvement from 30% in the June quarter to 45% in the September quarter to just below 50% in the December quarter and now over 50%.

Within the quarter we saw a sequential market share strength ending the period with a strong month in March. In the U.S. we held or grew value share in businesses representing two-thirds of sales in the March quarter. This is up from 15% in the June quarter of last fiscal year and about 55% in the first half of this fiscal. As with the rest of the Company results strengthened as the quarter progressed with businesses representing over 70% of sales holding or growing share in the month of March.

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