FORM 10-Q |
x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Ohio | 31-0411980 | |
(State of Incorporation) | (I.R.S. Employer Identification Number) |
One Procter & Gamble Plaza, Cincinnati, Ohio | 45202 | |
(Address of principal executive offices) | (Zip Code) |
Three Months Ended December 31 | Six Months Ended December 31 | ||||||||||||||
Amounts in millions except per share amounts | 2014 | 2013 | 2014 | 2013 | |||||||||||
NET SALES | $ | 20,161 | $ | 21,099 | $ | 40,347 | $ | 41,273 | |||||||
Cost of products sold | 10,083 | 10,474 | 20,292 | 20,682 | |||||||||||
Selling, general and administrative expense | 6,131 | 6,323 | 12,330 | 12,319 | |||||||||||
OPERATING INCOME | 3,947 | 4,302 | 7,725 | 8,272 | |||||||||||
Interest expense | 160 | 185 | 330 | 351 | |||||||||||
Interest income | 34 | 22 | 65 | 44 | |||||||||||
Other non-operating income, net | 19 | 43 | 40 | 48 | |||||||||||
EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 3,840 | 4,182 | 7,500 | 8,013 | |||||||||||
Income taxes on continuing operations | 865 | 885 | 1,685 | 1,782 | |||||||||||
NET EARNINGS FROM CONTINUING OPERATIONS | 2,975 | 3,297 | 5,815 | 6,231 | |||||||||||
NET EARNINGS/(LOSS) FROM DISCONTINUED OPERATIONS | (577 | ) | 175 | (1,397 | ) | 298 | |||||||||
NET EARNINGS | 2,398 | 3,472 | 4,418 | 6,529 | |||||||||||
Less: Net earnings attributable to noncontrolling interests | 26 | 44 | 56 | 74 | |||||||||||
NET EARNINGS ATTRIBUTABLE TO PROCTER & GAMBLE | $ | 2,372 | $ | 3,428 | $ | 4,362 | $ | 6,455 | |||||||
BASIC NET EARNINGS PER COMMON SHARE (1): | |||||||||||||||
Earnings from continuing operations | $ | 1.06 | $ | 1.18 | $ | 2.08 | $ | 2.21 | |||||||
Earnings/(loss) from discontinued operations | (0.21 | ) | 0.06 | (0.52 | ) | 0.11 | |||||||||
BASIC NET EARNINGS PER COMMON SHARE | 0.85 | 1.24 | 1.56 | 2.32 | |||||||||||
DILUTED NET EARNINGS PER COMMON SHARE (1): | |||||||||||||||
Earnings from continuing operations | $ | 1.02 | $ | 1.12 | $ | 2.00 | $ | 2.11 | |||||||
Earnings/(loss) from discontinued operations | (0.20 | ) | 0.06 | (0.49 | ) | 0.10 | |||||||||
DILUTED NET EARNINGS PER COMMON SHARE | 0.82 | 1.18 | 1.51 | 2.21 | |||||||||||
DIVIDENDS PER COMMON SHARE | $ | 0.644 | $ | 0.602 | $ | 1.287 | $ | 1.203 | |||||||
Diluted Weighted Average Common Shares Outstanding | 2,885.2 | 2,908.5 | 2,886.8 | 2,916.4 |
Three Months Ended December 31 | Six Months Ended December 31 | ||||||||||||||
Amounts in millions | 2014 | 2013 | 2014 | 2013 | |||||||||||
NET EARNINGS | $ | 2,398 | $ | 3,472 | $ | 4,418 | $ | 6,529 | |||||||
OTHER COMPREHENSIVE INCOME/(LOSS), NET OF TAX | |||||||||||||||
Financial statement translation | (2,091 | ) | 431 | (4,927 | ) | 1,480 | |||||||||
Hedges | 365 | (71 | ) | 773 | (310 | ) | |||||||||
Investment securities | 1 | (15 | ) | (2 | ) | (1 | ) | ||||||||
Defined benefit retirement plans | 219 | 20 | 501 | (36 | ) | ||||||||||
TOTAL OTHER COMPREHENSIVE INCOME/(LOSS), NET OF TAX | (1,506 | ) | 365 | (3,655 | ) | 1,133 | |||||||||
TOTAL COMPREHENSIVE INCOME | 892 | 3,837 | 763 | 7,662 | |||||||||||
Less: Total comprehensive income/(loss) attributable to noncontrolling interests | (18 | ) | 50 | (6 | ) | 85 | |||||||||
TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO P&G | $ | 910 | $ | 3,787 | $ | 769 | $ | 7,577 |
Amounts in millions | December 31, 2014 | June 30, 2014 | ||||||||||
ASSETS | ||||||||||||
CURRENT ASSETS | ||||||||||||
Cash and cash equivalents | $ | 8,204 | $ | 8,558 | ||||||||
Available-for-sale investment securities | 4,047 | 2,128 | ||||||||||
Accounts receivable | 5,802 | 6,386 | ||||||||||
Inventories | ||||||||||||
Materials and supplies | 1,775 | 1,742 | ||||||||||
Work in process | 612 | 684 | ||||||||||
Finished goods | 4,090 | 4,333 | ||||||||||
Total inventories | 6,477 | 6,759 | ||||||||||
Deferred income taxes | 816 | 1,092 | ||||||||||
Prepaid expenses and other current assets | 3,679 | 3,845 | ||||||||||
Assets held for sale | 4,153 | 2,849 | ||||||||||
TOTAL CURRENT ASSETS | 33,178 | 31,617 | ||||||||||
PROPERTY, PLANT AND EQUIPMENT, NET | 20,745 | 22,304 | ||||||||||
GOODWILL | 48,875 | 53,704 | ||||||||||
TRADEMARKS AND OTHER INTANGIBLE ASSETS, NET | 27,567 | 30,843 | ||||||||||
OTHER NONCURRENT ASSETS | 5,898 | 5,798 | ||||||||||
TOTAL ASSETS | $ | 136,263 | $ | 144,266 | ||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||
CURRENT LIABILITIES | ||||||||||||
Accounts payable | $ | 7,733 | $ | 8,461 | ||||||||
Accrued and other liabilities | 8,853 | 8,999 | ||||||||||
Liabilities held for sale | 1,237 | 660 | ||||||||||
Debt due within one year | 16,329 | 15,606 | ||||||||||
TOTAL CURRENT LIABILITIES | 34,152 | 33,726 | ||||||||||
LONG-TERM DEBT | 18,124 | 19,811 | ||||||||||
DEFERRED INCOME TAXES | 9,552 | 10,218 | ||||||||||
OTHER NONCURRENT LIABILITIES | 9,623 | 10,535 | ||||||||||
TOTAL LIABILITIES | 71,451 | 74,290 | ||||||||||
SHAREHOLDERS’ EQUITY | ||||||||||||
Preferred stock | 1,094 | 1,111 | ||||||||||
Common stock – shares issued – | December 2014 | 4,009.2 | ||||||||||
June 2014 | 4,009.2 | 4,009 | 4,009 | |||||||||
Additional paid-in capital | 63,814 | 63,911 | ||||||||||
Reserve for ESOP debt retirement | (1,332 | ) | (1,340 | ) | ||||||||
Accumulated other comprehensive income/(loss) | (11,317 | ) | (7,662 | ) | ||||||||
Treasury stock | (77,905 | ) | (75,805 | ) | ||||||||
Retained earnings | 85,770 | 84,990 | ||||||||||
Noncontrolling interest | 679 | 762 | ||||||||||
TOTAL SHAREHOLDERS’ EQUITY | 64,812 | 69,976 | ||||||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 136,263 | $ | 144,266 |
Six Months Ended December 31 | |||||||
Amounts in millions | 2014 | 2013 | |||||
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | $ | 8,558 | $ | 5,947 | |||
OPERATING ACTIVITIES | |||||||
Net earnings | 4,418 | 6,529 | |||||
Depreciation and amortization | 1,540 | 1,526 | |||||
Share-based compensation expense | 151 | 153 | |||||
Deferred income taxes | 31 | (126 | ) | ||||
Gain on sale of businesses | (299 | ) | (5 | ) | |||
Goodwill and indefinite-lived intangible asset impairment charges | 1,713 | — | |||||
Changes in: | |||||||
Accounts receivable | (342 | ) | (376 | ) | |||
Inventories | (506 | ) | (446 | ) | |||
Accounts payable, accrued and other liabilities | 243 | (1,191 | ) | ||||
Other operating assets and liabilities | (164 | ) | (859 | ) | |||
Other | 283 | 138 | |||||
TOTAL OPERATING ACTIVITIES | 7,068 | 5,343 | |||||
INVESTING ACTIVITIES | |||||||
Capital expenditures | (1,642 | ) | (1,663 | ) | |||
Proceeds from asset sales | 3,648 | 15 | |||||
Acquisitions, net of cash acquired | (112 | ) | 1 | ||||
Purchases of available-for-sale investment securities | (2,106 | ) | — | ||||
Proceeds from sales of available-for-sale investment securities | 179 | — | |||||
Change in other investments | (836 | ) | (149 | ) | |||
TOTAL INVESTING ACTIVITIES | (869 | ) | (1,796 | ) | |||
FINANCING ACTIVITIES | |||||||
Dividends to shareholders | (3,614 | ) | (3,409 | ) | |||
Change in short-term debt | 352 | (429 | ) | ||||
Additions to long-term debt | 1,112 | 4,271 | |||||
Reductions of long-term debt | (1,911 | ) | (3 | ) | |||
Treasury stock purchases | (4,253 | ) | (4,004 | ) | |||
Impact of stock options and other | 2,009 | 937 | |||||
TOTAL FINANCING ACTIVITIES | (6,305 | ) | (2,637 | ) | |||
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS | (248 | ) | 72 | ||||
CHANGE IN CASH AND CASH EQUIVALENTS | (354 | ) | 982 | ||||
CASH AND CASH EQUIVALENTS, END OF PERIOD | $ | 8,204 | $ | 6,929 |
Three Months Ended December 31 | Six Months Ended December 31 | ||||||||||||||||||||||||
Net Sales | Earnings / (Loss) from Continuing Operations Before Income Taxes | Net Earnings / (Loss) from Continuing Operations | Net Sales | Earnings / (Loss) from Continuing Operations Before Income Taxes | Net Earnings / (Loss) from Continuing Operations | ||||||||||||||||||||
Beauty, Hair and Personal Care | 2014 | $ | 4,962 | $ | 1,089 | $ | 863 | $ | 9,819 | $ | 2,015 | $ | 1,573 | ||||||||||||
2013 | 5,284 | 1,160 | 927 | 10,187 | 2,069 | 1,617 | |||||||||||||||||||
Grooming | 2014 | 2,007 | 713 | 544 | 3,948 | 1,334 | 1,010 | ||||||||||||||||||
2013 | 2,118 | 730 | 553 | 4,074 | 1,331 | 1,006 | |||||||||||||||||||
Health Care | 2014 | 2,088 | 514 | 369 | 4,099 | 973 | 691 | ||||||||||||||||||
2013 | 2,153 | 525 | 374 | 4,047 | 909 | 639 | |||||||||||||||||||
Fabric Care and Home Care | 2014 | 5,775 | 1,083 | 706 | 11,708 | 2,164 | 1,425 | ||||||||||||||||||
2013 | 6,022 | 1,149 | 751 | 12,032 | 2,331 | 1,534 | |||||||||||||||||||
Baby, Feminine and Family Care | 2014 | 5,217 | 1,117 | 760 | 10,539 | 2,319 | 1,585 | ||||||||||||||||||
2013 | 5,323 | 1,099 | 765 | 10,570 | 2,181 | 1,490 | |||||||||||||||||||
Corporate | 2014 | 112 | (676 | ) | (267 | ) | 234 | (1,305 | ) | (469 | ) | ||||||||||||||
2013 | 199 | (481 | ) | (73 | ) | 363 | (808 | ) | (55 | ) | |||||||||||||||
Total Company | 2014 | $ | 20,161 | $ | 3,840 | $ | 2,975 | $ | 40,347 | $ | 7,500 | $ | 5,815 | ||||||||||||
2013 | 21,099 | 4,182 | 3,297 | 41,273 | 8,013 | 6,231 |
Beauty, Hair and Personal Care | Grooming | Health Care | Fabric Care and Home Care | Baby, Feminine and Family Care | Corporate | Total Company | |||||||||||||||||||||
GOODWILL at June 30, 2014 | $ | 17,040 | $ | 20,939 | $ | 6,280 | $ | 1,981 | $ | 4,910 | $ | 2,554 | $ | 53,704 | |||||||||||||
Acquisitions, divestitures and discontinued operations (1) | — | — | — | (2 | ) | — | (2,515 | ) | (2,517 | ) | |||||||||||||||||
Translation and other | (926 | ) | (820 | ) | (246 | ) | (64 | ) | (217 | ) | (39 | ) | (2,312 | ) | |||||||||||||
GOODWILL at December 31, 2014 | $ | 16,114 | $ | 20,119 | $ | 6,034 | $ | 1,915 | $ | 4,693 | $ | — | $ | 48,875 |
Gross Carrying Amount | Accumulated Amortization | ||||||
Intangible assets with determinable lives | $ | 8,581 | $ | (4,984 | ) | ||
Intangible assets with indefinite lives | 23,970 | — | |||||
Total identifiable intangible assets | $ | 32,551 | $ | (4,984 | ) |
Fair Value Asset | ||||||||
December 31, 2014 | June 30, 2014 | |||||||
Investments | ||||||||
U.S. government securities | $ | 3,077 | $ | 1,631 | ||||
Corporate bond securities | 970 | 497 | ||||||
Other investments | 29 | 30 | ||||||
Total | $ | 4,076 | $ | 2,158 |
Notional Amount | Fair Value Asset/(Liability) | ||||||||||||||
December 31, 2014 | June 30, 2014 | December 31, 2014 | June 30, 2014 | ||||||||||||
Derivatives in Cash Flow Hedging Relationships | |||||||||||||||
Foreign currency contracts | $ | 951 | $ | 951 | $ | 300 | $ | 187 | |||||||
Derivatives in Fair Value Hedging Relationships | |||||||||||||||
Interest rate contracts | $ | 8,128 | $ | 9,738 | $ | 251 | $ | 168 | |||||||
Derivatives in Net Investment Hedging Relationships | |||||||||||||||
Net investment hedges | $ | 855 | $ | 831 | $ | 164 | $ | 48 | |||||||
Derivatives Not Designated as Hedging Instruments | |||||||||||||||
Foreign currency contracts | $ | 8,714 | $ | 12,111 | $ | (143 | ) | $ | (42 | ) |
Amount of Gain (Loss) Recognized in Accumulated OCI on Derivatives (Effective Portion) | |||||||
December 31, 2014 | June 30, 2014 | ||||||
Derivatives in Cash Flow Hedging Relationships | |||||||
Interest rate contracts | $ | 1 | $ | 3 | |||
Foreign currency contracts | 8 | 14 | |||||
Total | $ | 9 | $ | 17 | |||
Derivatives in Net Investment Hedging Relationships | |||||||
Net investment hedges | $ | 103 | $ | 30 |
Amount of Gain/(Loss) Reclassified from Accumulated OCI into Income | |||||||||||||||
Three Months Ended December 31 | Six Months Ended December 31 | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||
Derivatives in Cash Flow Hedging Relationships (1) | |||||||||||||||
Interest rate contracts | $ | 1 | $ | 1 | $ | 3 | $ | 3 | |||||||
Foreign currency contracts | 66 | 58 | 128 | 56 | |||||||||||
Total | $ | 67 | $ | 59 | $ | 131 | $ | 59 | |||||||
Amount of Gain/(Loss) Recognized in Income | |||||||||||||||
Three Months Ended December 31 | Six Months Ended December 31 | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||
Derivatives in Fair Value Hedging Relationships (2) | |||||||||||||||
Interest rate contracts | $ | 60 | $ | (84 | ) | 83 | (113 | ) | |||||||
Debt | (60 | ) | 84 | (83 | ) | 113 | |||||||||
Total | $ | — | $ | — | $ | — | $ | — | |||||||
Derivatives in Net Investment Hedging Relationships (2) | |||||||||||||||
Net investment hedges | $ | — | $ | — | $ | (1 | ) | $ | — | ||||||
Derivatives Not Designated as Hedging Instruments (3) | |||||||||||||||
Foreign currency contracts | $ | (316 | ) | $ | (26 | ) | $ | (729 | ) | $ | 83 |
(1) | The gain or loss on the effective portion of cash flow hedging relationships is reclassified from AOCI into net income in the same period during which the related item affects earnings. Such amounts are included in the Consolidated Statements of Earnings as follows: interest rate contracts in Interest expense and foreign currency contracts in Selling, general and administrative expense (SG&A) and Interest expense. |
(2) | The gain or loss on the ineffective portion of interest rate contracts and net investment hedges, if any, is included in the Consolidated Statements of Earnings in Interest expense. |
(3) | The gain or loss on foreign currency contracts not designated as hedging instruments is included in the Consolidated Statements of Earnings in SG&A. This gain or loss substantially offsets the foreign currency mark-to-market impact of the related exposure. |
Changes in Accumulated Other Comprehensive Income/(Loss) by Component | ||||||||||||||||||||
Hedges | Investment Securities | Pension and Other Retiree Benefits | Financial Statement Translation | Total | ||||||||||||||||
Balance at June 30, 2014 | $ | (3,876 | ) | $ | (18 | ) | $ | (5,165 | ) | $ | 1,397 | $ | (7,662 | ) | ||||||
OCI before reclassifications (1) | 902 | — | 355 | (4,927 | ) | (3,670 | ) | |||||||||||||
Amounts reclassified out of AOCI | (129 | ) | (2 | ) | 146 | — | 15 | |||||||||||||
Net current period OCI | 773 | (2 | ) | 501 | (4,927 | ) | (3,655 | ) | ||||||||||||
Balance at December 31, 2014 | $ | (3,103 | ) | $ | (20 | ) | $ | (4,664 | ) | $ | (3,530 | ) | $ | (11,317 | ) |
Reclassifications Out of Accumulated Other Comprehensive Income / (Loss) | |||||||||||||||
Three Months Ended December 31 | Six Months Ended December 31 | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||
Hedges (1) | |||||||||||||||
Interest rate contracts | $ | 1 | $ | 1 | $ | 3 | $ | 3 | |||||||
Foreign currency contracts | 66 | 58 | 128 | 56 | |||||||||||
Total before-tax | 67 | 59 | 131 | 59 | |||||||||||
Tax (expense)/benefit | (1 | ) | (1 | ) | (2 | ) | (1 | ) | |||||||
Net of tax | 66 | 58 | 129 | 58 | |||||||||||
Gains and (losses) on Investment Securities (2) | 3 | 16 | 3 | 16 | |||||||||||
Tax (expense)/benefit | (1 | ) | (6 | ) | (1 | ) | (6 | ) | |||||||
Net of tax | 2 | 10 | 2 | 10 | |||||||||||
Pension and Other Retiree Benefits (3) | |||||||||||||||
Amortization of deferred amounts | (2 | ) | (2 | ) | (5 | ) | (3 | ) | |||||||
Recognized net actuarial gains/(losses) | (97 | ) | (84 | ) | (197 | ) | (165 | ) | |||||||
Total before-tax | (99 | ) | (86 | ) | (202 | ) | (168 | ) | |||||||
Tax (expense)/benefit | 28 | 22 | 56 | 46 | |||||||||||
Net of tax | (71 | ) | (64 | ) | (146 | ) | (122 | ) | |||||||
Total reclassifications, net of tax | $ | (3 | ) | $ | 4 | $ | (15 | ) | $ | (54 | ) |
Three Months Ended December 31, 2014 | Three Months Ended December 31, 2013 | |||||||||||||||||||
CONSOLIDATED AMOUNTS | Continuing Operations | Discontinued Operations | Total | Continuing Operations | Discontinued Operations | Total | ||||||||||||||
Net earnings | $ | 2,975 | $ | (577 | ) | $ | 2,398 | $ | 3,297 | $ | 175 | $ | 3,472 | |||||||
Net earnings attributable to noncontrolling interests | (24 | ) | (2 | ) | (26 | ) | (39 | ) | (5 | ) | (44 | ) | ||||||||
Net earnings attributable to P&G (Diluted) | $ | 2,951 | $ | (579 | ) | $ | 2,372 | $ | 3,258 | $ | 170 | $ | 3,428 | |||||||
Preferred dividends, net of tax benefit | (70 | ) | — | (70 | ) | (67 | ) | — | (67 | ) | ||||||||||
Net earnings attributable to P&G available to Common Shareholders (Basic) | $ | 2,881 | $ | (579 | ) | $ | 2,302 | $ | 3,191 | $ | 170 | $ | 3,361 | |||||||
SHARES IN MILLIONS | ||||||||||||||||||||
Basic weighted average common shares outstanding | 2,705.7 | 2,705.7 | 2,705.7 | 2,719.2 | 2,719.2 | 2,719.2 | ||||||||||||||
Effect of dilutive securities | ||||||||||||||||||||
Conversion of preferred shares (1) | 109.1 | 109.1 | 109.1 | 112.7 | 112.7 | 112.7 | ||||||||||||||
Exercise of stock options and other unvested equity awards (2) | 70.4 | 70.4 | 70.4 | 76.6 | 76.6 | 76.6 | ||||||||||||||
Diluted weighted average common shares outstanding | 2,885.2 | 2,885.2 | 2,885.2 | 2,908.5 | 2,908.5 | 2,908.5 | ||||||||||||||
PER SHARE AMOUNTS (3) | ||||||||||||||||||||
Basic net earnings per common share | $ | 1.06 | $ | (0.21 | ) | $ | 0.85 | $ | 1.18 | $ | 0.06 | $ | 1.24 | |||||||
Diluted net earnings per common share | $ | 1.02 | $ | (0.20 | ) | $ | 0.82 | $ | 1.12 | $ | 0.06 | $ | 1.18 | |||||||
Six Months Ended December 31, 2014 | Six Months Ended December 31, 2013 | |||||||||||||||||||
CONSOLIDATED AMOUNTS | Continuing Operations | Discontinued Operations | Total | Continuing Operations | Discontinued Operations | Total | ||||||||||||||
Net earnings | $ | 5,815 | $ | (1,397 | ) | $ | 4,418 | $ | 6,231 | $ | 298 | $ | 6,529 | |||||||
Net earnings attributable to noncontrolling interests | (50 | ) | (6 | ) | (56 | ) | (64 | ) | (10 | ) | (74 | ) | ||||||||
Net earnings attributable to P&G (Diluted) | $ | 5,765 | $ | (1,403 | ) | $ | 4,362 | $ | 6,167 | $ | 288 | $ | 6,455 | |||||||
Preferred dividends, net of tax benefit | (130 | ) | — | (130 | ) | (125 | ) | — | (125 | ) | ||||||||||
Net earnings attributable to P&G available to Common Shareholders (Basic) | $ | 5,635 | $ | (1,403 | ) | $ | 4,232 | $ | 6,042 | $ | 288 | $ | 6,330 | |||||||
SHARES IN MILLIONS | ||||||||||||||||||||
Basic weighted average common shares outstanding | 2,708.2 | 2,708.2 | 2,708.2 | 2,727.2 | 2,727.2 | 2,727.2 | ||||||||||||||
Effect of dilutive securities | ||||||||||||||||||||
Conversion of preferred shares (1) | 109.7 | 109.7 | 109.7 | 113.1 | 113.1 | 113.1 | ||||||||||||||
Exercise of stock options and other unvested equity awards (2) | 68.9 | 68.9 | 68.9 | 76.1 | 76.1 | 76.1 | ||||||||||||||
Diluted weighted average common shares outstanding | 2,886.8 | 2,886.8 | 2,886.8 | 2,916.4 | 2,916.4 | 2,916.4 | ||||||||||||||
PER SHARE AMOUNTS (3) | ||||||||||||||||||||
Basic net earnings per common share | $ | 2.08 | $ | (0.52 | ) | $ | 1.56 | $ | 2.21 | $ | 0.11 | $ | 2.32 | |||||||
Diluted net earnings per common share | $ | 2.00 | $ | (0.49 | ) | $ | 1.51 | $ | 2.11 | $ | 0.10 | $ | 2.21 |
(1) | Despite being included currently in diluted net earnings per common share, the actual conversion to common stock occurs when the preferred shares are sold. Shares may only be sold after being allocated to the ESOP participants pursuant to the repayment of the ESOP's obligations through 2035. |
(2) | Less than 1 million in the three and six months ended December 31, 2014 and less than 1 million in the three and six months ended December 31, 2013 of the Company's outstanding stock options were not included in the diluted net earnings per share calculation because the options were out of the money or to do so would have been antidilutive (i.e., the total proceeds upon exercise would have exceeded the market value of the underlying common shares). |
(3) | Basic net earnings per common share and diluted net earnings per common share are calculated on net earnings attributable to Procter & Gamble. |
For the Six Months Ended December 31, 2014 | |||||||||||||||||||||||
Accrual Balance June 30, 2014 | Charges Previously Reported (Three Months Ended September 30, 2014) | Charges for the Three Months Ended December 31, 2014 | Cash Spent | Charges Against Assets | Accrual Balance December 31, 2014 | ||||||||||||||||||
Separations | $ | 353 | $ | 81 | $ | 98 | $ | (200 | ) | $ | 332 | ||||||||||||
Asset-Related Costs | — | 50 | 40 | — | (90 | ) | — | ||||||||||||||||
Other Costs | 28 | 27 | 45 | (80 | ) | 20 | |||||||||||||||||
Total | $ | 381 | $ | 158 | $ | 183 | $ | (280 | ) | $ | (90 | ) | $ | 352 |
Three Months Ended December 31 | Six Months Ended December 31 | ||||||
2014 | 2014 | ||||||
Beauty, Hair and Personal Care | $ | 32 | $ | 68 | |||
Grooming | 8 | 21 | |||||
Health Care | 4 | 6 | |||||
Fabric Care and Home Care | 32 | 54 | |||||
Baby, Feminine and Family Care | 26 | 66 | |||||
Corporate (1) | 81 | 126 | |||||
Total Company | $ | 183 | $ | 341 |
Three Months Ended December 31 | |||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||
Pet Care | Batteries | Total | Pet Care | Batteries | Total | ||||||||||||||||||
Net sales | $ | 72 | $ | 782 | $ | 854 | $ | 383 | $ | 798 | $ | 1,181 | |||||||||||
Earnings before impairment charges and income taxes | (5 | ) | 257 | 252 | 29 | 220 | 249 | ||||||||||||||||
Impairment charges | — | (740 | ) | (740 | ) | — | — | — | |||||||||||||||
Income tax expense | — | (103 | ) | (103 | ) | (11 | ) | (63 | ) | (74 | ) | ||||||||||||
Gain on sale before income taxes | 13 | — | 13 | — | — | — | |||||||||||||||||
Income tax expense on sale | 1 | — | 1 | — | — | — | |||||||||||||||||
Net earnings from discontinued operations | $ | 9 | $ | (586 | ) | $ | (577 | ) | $ | 18 | $ | 157 | $ | 175 |
Six Months Ended December 31 | |||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||
Pet Care | Batteries | Total | Pet Care | Batteries | Total | ||||||||||||||||||
Net sales | $ | 235 | $ | 1,388 | $ | 1,623 | $ | 758 | $ | 1,454 | $ | 2,212 | |||||||||||
Earnings before impairment charges and income taxes | 14 | 393 | 407 | 60 | 370 | 430 | |||||||||||||||||
Impairment charges | — | (1,713 | ) | (1,713 | ) | — | — | — | |||||||||||||||
Income tax expense | (6 | ) | (103 | ) | (109 | ) | (24 | ) | (108 | ) | (132 | ) | |||||||||||
Gain on sale before income taxes | 205 | — | 205 | — | — | — | |||||||||||||||||
Income tax expense on sale | (187 | ) | — | (187 | ) | — | — | — | |||||||||||||||
Net earnings from discontinued operations | $ | 26 | $ | (1,423 | ) | $ | (1,397 | ) | $ | 36 | $ | 262 | $ | 298 |
December 31, 2014 | June 30, 2014 | ||||||||||
Pet Care | Batteries | Pet Care | |||||||||
Cash | $ | — | $ | 32 | $ | — | |||||
Accounts receivable | — | 328 | — | ||||||||
Inventories | 16 | 317 | 122 | ||||||||
Prepaid expenses and other current assets | — | 27 | 14 | ||||||||
Property, plant and equipment, net | — | 472 | 441 | ||||||||
Goodwill and intangible assets, net | — | 2,941 | 2,258 | ||||||||
Other noncurrent assets | — | 20 | 14 | ||||||||
Total assets held for sale | $ | 16 | $ | 4,137 | $ | 2,849 | |||||
Accounts payable | $ | — | $ | 169 | $ | 63 | |||||
Accrued and other liabilities | — | 225 | 13 | ||||||||
Long-term debt | — | 32 | — | ||||||||
Noncurrent deferred tax liabilities | — | 811 | 584 | ||||||||
Total liabilities held for sale | $ | — | $ | 1,237 | $ | 660 |
• | Overview |
• | Summary of Results - Six Months Ended December 31, 2014 |
• | Economic Conditions, Challenges and Risks |
• | Results of Operations – Three and Six Months Ended December 31, 2014 |
• | Business Segment Discussion – Three and Six Months Ended December 31, 2014 |
• | Financial Condition |
• | Reconciliation of Non-GAAP Measures |
Reportable Business Segment | GBUs (Categories) | Billion Dollar Brands |
Beauty, Hair and Personal Care | Skin and Personal Care (Antiperspirant and Deodorant, Personal Cleansing, Skin Care); Cosmetics; Hair Care and Color; Prestige; Salon Professional | Head & Shoulders, Olay, Pantene, SK-II, Wella |
Grooming | Shave Care (Female Blades & Razors, Male Blades & Razors, Pre- and Post-Shave Products, Other Shave Care); Electronic Hair Removal | Fusion, Gillette, Mach3, Prestobarba |
Health Care | Personal Health Care (Gastrointestinal, Rapid Diagnostics, Respiratory, Vitamins/Minerals/Supplements, Other Personal Health Care); Oral Care (Toothbrush, Toothpaste, Other Oral Care) | Crest, Oral-B, Vicks |
Fabric Care and Home Care | Fabric Care (Laundry Additives, Fabric Enhancers, Laundry Detergents); Home Care (Air Care, Dish Care, P&G Professional, Surface Care) | Ariel, Dawn, Downy, Febreze, Gain, Tide |
Baby, Feminine and Family Care | Baby Care (Baby Wipes, Diapers and Pants); Feminine Care (Adult Incontinence, Feminine Care); Family Care (Paper Towels, Tissues, Toilet Paper) | Always, Bounty, Charmin, Pampers |
Three Months Ended December 31, 2014 | |||
Net Sales | Net Earnings | ||
Beauty, Hair and Personal Care | 25% | 27% | |
Grooming | 10% | 17% | |
Health Care | 10% | 11% | |
Fabric Care and Home Care | 29% | 22% | |
Baby, Feminine and Family Care | 26% | 23% | |
Total | 100% | 100% |
Six Months Ended December 31, 2014 | |||
Net Sales | Net Earnings | ||
Beauty, Hair and Personal Care | 25% | 25% | |
Grooming | 10% | 16% | |
Health Care | 10% | 11% | |
Fabric Care and Home Care | 29% | 23% | |
Baby, Feminine and Family Care | 26% | 25% | |
Total | 100% | 100% |
• | Net sales decreased 2% versus the previous year to $40.3 billion. Organic sales, which exclude the impacts of acquisitions, divestitures and foreign exchange, were up 2%. Organic sales decreased 1% in Beauty, Hair, and Personal Care and increased 1% in Grooming, 3% in Health Care, 2% in Fabric Care and Home Care and 4% in Baby, Feminine and Family Care. |
• | Unit volume was unchanged. Volume grew low single digits in Fabric and Home Care and Health Care. Volume decreased low single digits in Beauty, Hair and Personal Care and Grooming and was unchanged in Baby, Feminine and Family Care. |
• | Net earnings from continuing operations were $5.8 billion, a decrease of $416 million or 7% versus the prior year period. This decrease was driven primarily by reduced net sales and foreign currency charges, including a $104 million after-tax charge related to balance sheet remeasurements in Venezuela. |
• | Diluted net earnings per share from continuing operations decreased 5% to $2.00. |
• | Net earnings attributable to Procter & Gamble were $4.4 billion, a decrease of $2.1 billion, or 32% versus the prior year period. This was primarily driven by a non-cash, after-tax impairment charge of $1.7 billion related to the goodwill and indefinite-lived intangible assets in our Batteries business (reflected in Earnings from Discontinued Operations) and the reduction in net earnings from continuing operations. |
• | Core net earnings per share, which excludes discontinued operations, incremental restructuring charges, a balance sheet remeasurement charge from Venezuela and charges for European legal matters decreased 3% to $2.10. |
• | Operating cash flow was $7.1 billion. Adjusted free cash flow, which is operating cash flow less capital expenditures and excluding tax payments for the Pet divestiture, was $5.8 billion. Adjusted free cash flow productivity, which is the ratio of adjusted free cash flow to net earnings excluding impairment charges on the Batteries business and tax payments for the Pet Care divestiture, was 95%. |
Three Months Ended December 31 | ||||||||||
Amounts in millions, except per share amounts | 2014 | 2013 | % CHG | |||||||
Net sales | $ | 20,161 | $ | 21,099 | (4 | )% | ||||
Operating income | 3,947 | 4,302 | (8 | )% | ||||||
Net earnings from continuing operations | 2,975 | 3,297 | (10 | )% | ||||||
Net earnings from discontinued operations | (577 | ) | 175 | (430 | )% | |||||
Net earnings attributable to Procter & Gamble | 2,372 | 3,428 | (31 | )% | ||||||
Diluted net earnings per common share | 0.82 | 1.18 | (31 | )% | ||||||
Diluted net earnings per share from continuing operations | 1.02 | 1.12 | (9 | )% | ||||||
Core earnings per common share | 1.06 | 1.15 | (8 | )% | ||||||
COMPARISONS AS A % OF NET SALES | 2014 | 2013 | Basis Pt Chg | |||||||
Gross margin | 50.0 | % | 50.4 | % | (40 | ) | ||||
Selling, general & administrative expense | 30.4 | % | 30.0 | % | 40 | |||||
Operating margin | 19.6 | % | 20.4 | % | (80 | ) | ||||
Earnings before income taxes | 19.0 | % | 19.8 | % | (80 | ) | ||||
Net earnings attributable to Procter & Gamble | 11.8 | % | 16.2 | % | (440 | ) |
Net Sales Change Drivers 2014 vs. 2013 (Three Months Ended December 31) | |||||||||||||
Volume with Acquisitions & Divestitures | Volume Excluding Acquisitions & Divestitures | Foreign Exchange | Price | Mix | Other* | Net Sales Growth | |||||||
Beauty, Hair and Personal Care | -2% | -2% | -4% | 1% | 0% | -1% | -6% | ||||||
Grooming | -2% | -2% | -7% | 4% | 0% | 0% | -5% | ||||||
Health Care | -2% | -2% | -4% | 0% | 3% | 0% | -3% | ||||||
Fabric Care and Home Care | 2% | 2% | -6% | 1% | 0% | -1% | -4% | ||||||
Baby, Feminine and Family Care | 0% | 0% | -6% | 1% | 3% | 0% | -2% | ||||||
TOTAL COMPANY | 0% | 0% | -5% | 1% | 1% | -1% | -4% |
Six Months Ended December 31 | ||||||||||
Amounts in millions, except per share amounts | 2014 | 2013 | % CHG | |||||||
Net sales | $ | 40,347 | $ | 41,273 | (2 | )% | ||||
Operating income | 7,725 | 8,272 | (7 | )% | ||||||
Net earnings from continuing operations | 5,815 | 6,231 | (7 | )% | ||||||
Net earnings from discontinued operations | (1,397 | ) | 298 | (569 | )% | |||||
Net earnings attributable to Procter & Gamble | 4,362 | 6,455 | (32 | )% | ||||||
Diluted net earnings per common share | 1.51 | 2.21 | (32 | )% | ||||||
Diluted net earnings per share from continuing operations | 2.00 | 2.11 | (5 | )% | ||||||
Core earnings per common share | 2.10 | 2.16 | (3 | )% | ||||||
COMPARISONS AS A % OF NET SALES | 2014 | 2013 | Basis Pt Chg | |||||||
Gross margin | 49.7 | % | 49.9 | % | (20 | ) | ||||
Selling, general & administrative expense | 30.6 | % | 29.8 | % | 80 | |||||
Operating margin | 19.1 | % | 20.0 | % | (90 | ) | ||||
Earnings before income taxes | 18.6 | % | 19.4 | % | (80 | ) | ||||
Net earnings attributable to Procter & Gamble | 10.8 | % | 15.6 | % | (480 | ) |
Net Sales Change Drivers 2014 vs. 2013 (Six Months Ended December 31) | |||||||||||||
Volume with Acquisitions & Divestitures | Volume Excluding Acquisitions & Divestitures | Foreign Exchange | Price | Mix | Other* | Net Sales Growth | |||||||
Beauty, Hair and Personal Care | -2% | -1% | -3% | 0% | 0% | 1% | -4% | ||||||
Grooming | -2% | -2% | -4% | 4% | -1% | 0% | -3% | ||||||
Health Care | 1% | 1% | -2% | 0% | 2% | 0% | 1% | ||||||
Fabric Care and Home Care | 2% | 2% | -4% | 0% | 0% | -1% | -3% | ||||||
Baby, Feminine and Family Care | 0% | 0% | -4% | 2% | 2% | 0% | 0% | ||||||
TOTAL COMPANY | 0% | 0% | -3% | 1% | 1% | -1% | -2% |
Three Months Ended December 31, 2014 | ||||||||||||||||||||
Net Sales | % Change Versus Year Ago | Earnings / (Loss) from Continuing Operations Before Income Taxes | % Change Versus Year Ago | Net Earnings / (Loss) from Continuing Operations | % Change Versus Year Ago | |||||||||||||||
Beauty, Hair and Personal Care | $ | 4,962 | (6 | )% | $ | 1,089 | (6 | )% | $ | 863 | (7 | )% | ||||||||
Grooming | 2,007 | (5 | )% | 713 | (2 | )% | 544 | (2 | )% | |||||||||||
Health Care | 2,088 | (3 | )% | 514 | (2 | )% | 369 | (1 | )% | |||||||||||
Fabric Care and Home Care | 5,775 | (4 | )% | 1,083 | (6 | )% | 706 | (6 | )% | |||||||||||
Baby, Feminine and Family Care | 5,217 | (2 | )% | 1,117 | 2 | % | 760 | (1 | )% | |||||||||||
Corporate | 112 | N/A | (676 | ) | N/A | (267 | ) | N/A | ||||||||||||
Total Company | $ | 20,161 | (4 | )% | $ | 3,840 | (8 | )% | $ | 2,975 | (10 | )% |
Six Months Ended December 31, 2014 | ||||||||||||||||||||
Net Sales | % Change Versus Year Ago | Earnings / (Loss) from Continuing Operations Before Income Taxes | % Change Versus Year Ago | Net Earnings / (Loss) from Continuing Operations | % Change Versus Year Ago | |||||||||||||||
Beauty, Hair and Personal Care | $ | 9,819 | (4 | )% | $ | 2,015 | (3 | )% | $ | 1,573 | (3 | )% | ||||||||
Grooming | 3,948 | (3 | )% | 1,334 | — | % | 1,010 | — | % | |||||||||||
Health Care | 4,099 | 1 | % | 973 | 7 | % | 691 | 8 | % | |||||||||||
Fabric Care and Home Care | 11,708 | (3 | )% | 2,164 | (7 | )% | 1,425 | (7 | )% | |||||||||||
Baby, Feminine and Family Care | 10,539 | — | % | 2,319 | 6 | % | 1,585 | 6 | % | |||||||||||
Corporate | 234 | N/A | (1,305 | ) | N/A | (469 | ) | N/A | ||||||||||||
Total Company | $ | 40,347 | (2 | )% | $ | 7,500 | (6 | )% | $ | 5,815 | (7 | )% |
• | Volume in Hair Care decreased low single digits in both developed and developing markets due to competitive activity in developed markets (primarily Japan) and following increased pricing and minor divestitures in developing markets. Global market share of the hair care category decreased less than half a point. |
• | Volume in Skin and Personal Care decreased low single digits as decreases in skin care and personal cleansing were partially offset by growth in deodorants. Volume was unchanged in developed regions and decreased mid-single digits in developing regions due to ongoing competitive activity. Global market share of the skin and personal care category decreased nearly half a point. |
• | Volume in Cosmetics increased low single digits both in developed markets (driven by increased merchandising investment) and in developing markets (primarily due to product innovation). Global market share of the cosmetics category decreased slightly. |
• | Volume in Salon Professional decreased mid-single digits primarily due to a double-digit decrease in developing markets following increased pricing. Volume decreased low single digits in developed markets due to market contraction. |
• | Volume in Prestige decreased double digits due to lower levels of product innovation versus the base period. |
• | Volume in Hair Care decreased low single digits. Volume was unchanged in developed markets and decreased low single digits in developing markets following increased pricing and minor divestitures. Global market share of the hair care category decreased half a point. |
• | Volume in Skin and Personal Care decreased low single digits as decreases in skin care and personal cleansing were partially offset by growth in deodorants. Volume increased low single digits in developed regions from product innovation and decreased low single digits in developing regions due to ongoing competitive activity. Global market share of the skin and personal care category decreased nearly half a point. |
• | Volume in Cosmetics increased low single digits due to a double-digit increase in developing markets primarily due to market growth and product innovation. Volume in developed markets increased low single digits. Global market share of the cosmetics category decreased slightly. |
• | Volume in Salon Professional decreased low single digits due to a mid-single-digit decrease in developing markets following increased pricing and due to market contraction. Volume in developed markets decreased low single digits primarily due to market declines. |
• | Volume in Prestige decreased high single digits due to market contraction and reduced levels of initiative activity. |
• | Shave Care volume decreased low single digits due to a low single-digit decrease in both developed and developing regions caused primarily by market contraction in developed regions and by reduced volumes following increased pricing in developing regions. Global market share of the blades and razors category was flat. |
• | Volume in Electronic Hair Removal increased mid-single digits in both developed and developing regions behind product innovation and market growth. Global market share of the electronic hair removal category was flat. |
• | Shave Care volume decreased low single digits due to a mid-single-digit decrease in developed regions caused by market contraction and a low single-digit decrease in developing regions following increased pricing. Global market share of the blades and razors category increased less than half a point. |
• | Volume in Electronic Hair Removal increased mid-single digits driven primarily by a high single-digit increase in developing markets behind product innovation and market growth. Global market share of the electronic hair removal category decreased slightly. |
• | Oral Care volume decreased low single digits as a mid-single-digit decrease in developing regions following increased pricing was partially offset by low single-digit growth in developed regions from product innovation. Global market share of the oral care category was flat. |
• | Volume in Personal Health Care decreased high single digits. A mid-single-digit decrease in developed markets and a double digit decrease in developing markets were both driven primarily by competitive activity. Global market share of the personal health care category decreased more than half a point. |
• | Oral Care volume increased low single digits due to mid-single-digit growth in developed regions from product innovation, partially offset by low single-digit decline in developing regions following increased pricing. Global market share of the oral care category was flat. |
• | Volume in Personal Health Care decreased low single digits due to a low single-digit decrease in developed markets and a mid-single-digit decrease in developing markets. Market growth and new product innovation were more than offset by the negative impact of competitive activity. Global market share of the personal health care category was down one point. |
• | Fabric Care volume increased low single digits due to low single-digit increases in both developed and developing regions behind product innovation and lower pricing in certain regions. Global market share of the fabric care category was flat. |
• | Home Care volume decreased low single digits as a low single-digit decrease in developed markets due to competitive activity was partially offset by a low single-digit increase in developing regions from product innovation. Global market share of the home care category was down less than half a point. |
• | Fabric Care volume increased low single digits driven by a low single-digit increase in both developed and developing regions behind market growth and product innovation. Global market share of the fabric care category increased slightly. |
• | Home Care volume was unchanged as a low single-digit increase in developing regions from product innovation was offset by a low single-digit decrease in developed markets due to competitive activity. Global market share of the home care category was down slightly. |
• | Volume in Baby Care increased low single digits due to a mid-single-digit increase in developed regions from product innovation, partially offset by a low single-digit decrease in developing regions following increased pricing. Global market share of the baby care category decreased half a point. |
• | Volume in Feminine Care decreased low single digits as a low single-digit decline in developing regions due to competitive activity was partially offset by low single-digit growth in developed regions from product innovation. Global market share of the feminine care category was flat. |
• | Volume in Family Care decreased low single digits as low single-digit growth in developed regions was more than offset by a double-digit decline in developing regions due to decreased distribution. In the U.S., all-outlet share of the family care category decreased more than a point. |
• | Volume in Baby Care was unchanged as a low single-digit increase in developed regions from product innovation was offset by a low single-digit decrease in developing regions following increased pricing. Global market share of the baby care category decreased nearly half a point. |
• | Volume in Feminine Care increased low single digits due to mid-single-digit growth in developed regions from product innovation, partially offset by a low single-digit decline in developing regions due to competition. Global market share of the feminine care category decreased less than half a point. |
• | Volume in Family Care decreased low single digits as low single-digit growth in developed regions was more than offset by a double-digit decline in developing regions due to competitive activity. In the U.S., all-outlet share of the family care category decreased more than a point. |
Three months ended December 31, 2014 | Net Sales Growth | Foreign Exchange Impact | Acquisition/ Divestiture Impact* | Organic Sales Growth | |||||||
Beauty, Hair and Personal Care | (6 | )% | 4 | % | 1 | % | (1 | )% | |||
Grooming | (5 | )% | 7 | % | — | % | 2 | % | |||
Health Care | (3 | )% | 4 | % | — | % | 1 | % | |||
Fabric Care and Home Care | (4 | )% | 6 | % | 1 | % | 3 | % | |||
Baby, Feminine and Family Care | (2 | )% | 6 | % | — | % | 4 | % | |||
Total Company | (4 | )% | 5 | % | 1 | % | 2 | % |
Six months ended December 2014 | Net Sales Growth | Foreign Exchange Impact | Acquisition/ Divestiture Impact* | Organic Sales Growth | |||||||
Beauty, Hair and Personal Care | (4 | )% | 3 | % | — | % | (1 | )% | |||
Grooming | (3 | )% | 4 | % | — | % | 1 | % | |||
Health Care | 1 | % | 2 | % | — | % | 3 | % | |||
Fabric Care and Home Care | (3 | )% | 4 | % | 1 | % | 2 | % | |||
Baby, Feminine and Family Care | — | % | 4 | % | — | % | 4 | % | |||
Total Company | (2 | )% | 3 | % | 1 | % | 2 | % |
Three Months Ended December 31 | |||||||
2014 | 2013 | ||||||
Diluted net earnings per share from continuing operations | $ | 1.02 | $ | 1.12 | |||
Incremental restructuring charges | 0.03 | 0.03 | |||||
Charge for European legal matters | 0.01 | — | |||||
CORE EPS | $ | 1.06 | $ | 1.15 | |||
Core EPS Growth | (8 | )% |
Six Months Ended December 31 | |||||||
2014 | 2013 | ||||||
Diluted net earnings per share from continuing operations | $ | 2.00 | $ | 2.11 | |||
Incremental restructuring charges | 0.05 | 0.04 | |||||
Venezuela balance sheet remeasurement | 0.04 | — | |||||
Charge for European legal matters | 0.01 | — | |||||
Rounding | — | 0.01 | |||||
CORE EPS | $ | 2.10 | $ | 2.16 | |||
Core EPS Growth | (3 | )% |
Operating Cash Flow | Capital Spending | Free Cash Flow | Cash Tax Payment - Pet Care Sale | Adjusted Free Cash Flow | |||||
July 2014 - December 2014 | $7,068 | $1,642 | $5,426 | $363 | $5,789 |
Net Earnings | Impairment Charges | Net Earnings Excl. Impairment Charges on Batteries | Adjusted Free Cash Flow Productivity | ||||
July 2014 - December 2014 | $4,418 | $1,672 | $6,090 | 95% |
Item 3. | Quantitative and Qualitative Disclosures About Market Risk. |
Item 4. | Controls and Procedures. |
Item 1. | Legal Proceedings. |
Item 1A. | Risk Factors. |
• | If the global economy experiences significant disruptions, our business could be negatively impacted by reduced demand for our products related to: a slow-down in the general economy; reduced market growth rates; supplier, vendor or customer |
• | Our objective is to maintain credit ratings that provide us with ready access to global capital and credit markets. Any downgrade of our current credit rating could increase our future borrowing costs and impair our ability to access capital and credit markets on terms commercially acceptable to us. |
• | We may be negatively impacted by political issues or crises in individual countries or regions, including sovereign risk related to a default by or deterioration in the credit worthiness of local governments. |
• | We hold assets, incur liabilities, earn revenues, and pay expenses in a variety of currencies other than the U.S. dollar, and our operations outside the U.S. generate a significant portion of our net revenue. Fluctuations in exchange rates, such as the recent volatility in the Russian Ruble, may therefore adversely impact our business results or financial condition. See also the Results of Operations and Cash Flow, Financial Condition and Liquidity sections of the MD&A and Note 5 to our Consolidated Financial Statements. |
• | compliance with local laws and regulations in each country, as well as U.S. laws affecting operations outside the U.S., such as the Foreign Corrupt Practices Act; |
• | changes in exchange controls and other limits on our ability to repatriate earnings from overseas; |
• | discriminatory or conflicting fiscal policies; |
• | difficulties enforcing intellectual property and contractual rights in certain jurisdictions; |
• | risk of uncollectible accounts and longer collection cycles; |
• | effective and immediate implementation of control environment processes across our diverse operations and employee base; and |
• | imposition of increased or new tariffs, quotas, price controls, trade barriers or similar restrictions on our sales outside the U.S. |
• | We need to maintain key manufacturing and supply arrangements, including any key sole supplier and sole manufacturing plant arrangements, to achieve our cost targets. |
• | While we have business continuity and contingency plans for key manufacturing sites and the supply of raw materials, it may be impracticable to have a sufficient alternative source, particularly when the input materials are in limited supply. |
• | In addition, our strategy for global growth includes increased presence in emerging markets. Some emerging markets have greater political volatility and greater vulnerability to infrastructure and labor disruptions than established markets. |
• | Any significant disruption of manufacturing, such as labor disputes, loss or impairment of key manufacturing sites, natural disasters, acts of war or terrorism and other external factors over which we have no control, could interrupt product supply and, if not remedied, have an adverse impact on our business. |
• | ordering and managing materials from suppliers; |
• | converting materials to finished products; |
• | shipping products to customers; |
• | marketing and selling products to consumers; |
• | collecting and storing customer, consumer, employee, vendor, investor and other stakeholder information and personal data; |
• | processing transactions; |
• | summarizing and reporting results of operations; |
• | hosting, processing and sharing confidential and proprietary research, business plans and financial information; |
• | complying with regulatory, legal or tax requirements; |
• | providing data security; and |
• | handling other processes necessary to manage our business. |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds. |
Period | Total Number of Shares Purchased (1) | Average Price Paid per Share (2) | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (3) | Approximate Dollar Value of Shares That May Yet Be Purchased Under our Share Repurchase Program ($ in billions) | |||||||
10/01/2014 - 10/31/2014 | 7,445,776 | $ | 83.94 | 7,445,776 | (3) | ||||||
11/01/2014 - 11/30/2014 | 6,689,444 | $ | 88.64 | 6,689,444 | (3) | ||||||
12/01/2014 - 12/31/2014 | 7,226,484 | $ | 90.92 | 7,226,484 | (3) | ||||||
Total | 21,361,704 | $ | 87.77 | 21,361,704 |
(1) | All transactions were made in the open market with large financial institutions. This table excludes shares withheld from employees to satisfy minimum tax withholding requirements on option exercises and other equity-based transactions. The Company administers cashless exercises through an independent third party and does not repurchase stock in connection with cashless exercises. |
(2) | Average price paid per share is calculated on a settlement basis and excludes commission. |
(3) | On August 1, 2014, the Company stated that fiscal year 2015 share repurchases to reduce Company shares outstanding are estimated to be approximately $5 billion to $7 billion, notwithstanding any purchases under the Company's compensation and benefit plans. Purchases may be made in the open market and/or private transactions and purchases may be increased, decreased or discontinued at any time without prior notice. The share repurchases are authorized pursuant to a resolution issued by the Company's Board of Directors and are expected to be financed by a combination of operating cash flows and issuance of long-term and short-term debt. |
Item 6. | Exhibits |
3-1 | Amended Articles of Incorporation (as amended by shareholders at the annual meeting on October 11, 2011) (Incorporated by reference to Exhibit (3-1) of the Company's Form 10-Q for the quarter ended September 30, 2011) | ||
3-2 | Regulations (as approved by the Board of Directors on October 14, 2014, pursuant to authority granted by shareholders at the annual meeting on October 13, 2009) (Incorporated by reference to Exhibit (3-2) of the Company's Form 10-Q for the quarter ended September 30, 2014) | ||
10-1 | Company's Forms of Separation Agreement & Release* | ||
10-2 | The Procter & Gamble 2014 Stock and Incentive Compensation Plan - Additional terms and conditions* | ||
10-3 | The Procter & Gamble 2014 Stock and Incentive Compensation Plan - Related correspondence* | ||
12 | Computation of Ratio of Earnings to Fixed Charges | ||
31.1 | Rule 13a-14(a)/15d-14(a) Certification – Chief Executive Officer | ||
31.2 | Rule 13a-14(a)/15d-14(a) Certification – Chief Financial Officer | ||
32.1 | Section 1350 Certifications – Chief Executive Officer | ||
32.2 | Section 1350 Certifications – Chief Financial Officer | ||
101.INS (1) | XBRL Instance Document | ||
101.SCH (1) | XBRL Taxonomy Extension Schema Document | ||
101.CAL (1) | XBRL Taxonomy Extension Calculation Linkbase Document | ||
101.DEF (1) | XBRL Taxonomy Definition Linkbase Document | ||
101.LAB (1) | XBRL Taxonomy Extension Label Linkbase Document | ||
101.PRE (1) | XBRL Taxonomy Extension Presentation Linkbase Document |
* | Compensatory plan or arrangement |
(1) | XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections. |
THE PROCTER & GAMBLE COMPANY | ||||
January 27, 2015 | /s/ VALARIE L. SHEPPARD | |||
Date | (Valarie L. Sheppard) | |||
Senior Vice President, Comptroller and Treasurer |
Exhibit | |||
3-1 | Amended Articles of Incorporation (as amended by shareholders at the annual meeting on October 11, 2011) (Incorporated by reference to Exhibit (3-1) of the Company's Form 10-Q for the quarter ended September 30, 2011) | ||
3-2 | Regulations (as approved by the Board of Directors on October 14, 2014, pursuant to authority granted by shareholders at the annual meeting on October 13, 2009) (Incorporated by reference to Exhibit (3-2) of the Company's Form 10-Q for the quarter ended September 30, 2014) | ||
10-1 | Company's Forms of Separation Agreement & Release | ||
10-2 | The Procter & Gamble 2014 Stock and Incentive Compensation Plan - Additional terms and conditions | ||
10-3 | The Procter & Gamble 2014 Stock and Incentive Compensation Plan - Related correspondence | ||
12 | Computation of Ratio of Earnings to Fixed Charges | ||
31.1 | Rule 13a-14(a)/15d-14(a) Certification – Chief Executive Officer | ||
31.2 | Rule 13a-14(a)/15d-14(a) Certification – Chief Financial Officer | ||
32.1 | Section 1350 Certifications – Chief Executive Officer | ||
32.2 | Section 1350 Certifications – Chief Financial Officer | ||
101.INS (1) | XBRL Instance Document | ||
101.SCH (1) | XBRL Taxonomy Extension Schema Document | ||
101.CAL (1) | XBRL Taxonomy Extension Calculation Linkbase Document | ||
101.DEF (1) | XBRL Taxonomy Definition Linkbase Document | ||
101.LAB (1) | XBRL Taxonomy Extension Label Linkbase Document | ||
101.PRE (1) | XBRL Taxonomy Extension Presentation Linkbase Document |
(1) | XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections. |
Last Day of Employment: | Your last day of employment will be «Exit_Date», referred to as your “Last Day of Employment.” Unless otherwise noted below, your pay and benefits will cease as of your Last Day of Employment. |
Separation Payment: | As soon as administratively practical after your Last Day of Employment, P&G will provide you with a Separation Payment of «Total_Amount», less legally required withholdings and deductions. In no event will payment be made before expiration of the seven-day revocation period discussed below or later than the March 15th of the year following the year which includes your last day of employment. Amounts you owe to P&G as of your Last Day of Employment, including, but not limited to, wage and/or benefit overpayments and unpaid loans, will also be deducted from the Separation Payment. |
Payment for Unvested PST: | If you are not fully-vested in the Procter & Gamble Profit Sharing Trust and Employee Stock Ownership Plan (“PST”) as of your Last Day of Employment, as soon as administratively practical after your Last Day of Employment, but no later than the March 15th of the year following the year which includes your Last Day of Employment, you will receive a lump sum payment in an amount substantially equivalent to the non-vested credits in your account in the PST. |
STAR Awards: | As of your Last Day of Employment, if you were otherwise eligible for a STAR award and you worked at least 28 days (4 calendar weeks) during that fiscal year, you will receive a pro-rated STAR award for that fiscal year. Your STAR award will be pro-rated by dividing the number of calendar days during the fiscal year from July 1 through your Last Day of Employment by 365. Your STAR award will be paid in cash in the September (but no later than September 15th) immediately following the end of the fiscal year in which you terminate. |
Equity Awards (including Recognition Shares): | Your separation will be treated as a Special Separation for purposes of any outstanding equity awards granted under the Procter & Gamble 2009 Stock and Incentive Compensation Plan, the Procter & Gamble 2001 Stock and Incentive Compensation Plan, the Procter & Gamble 1992 Stock Plan, or the Gillette Company 2004 Long-Term Incentive Plan and as a result the awards will be retained subject to the original terms and conditions of the awards. Awards granted under the Procter & Gamble 2014 Stock & Incentive Compensation Plan are retained subject to the terms and conditions of the Awards. This agreement does not alter the rights and obligations that you may have under the Procter & Gamble 2014 Stock & Incentive compensation Plan, the Procter & Gamble 2009 Stock and Incentive Compensation Plan, the Procter & Gamble 2001 Stock and Incentive Plan, the Procter & Gamble 1992 Stock Plan, and the Gillette Company 2004 Long-Term Incentive Plan. |
Current Medical, Dental, and Life Insurance Benefits: | Your Medical (including prescription drug and EAP programs), Dental, and Basic Group Life insurance coverage will continue under the same terms until «Benefits_End_Date». When your extended coverage ends, you may be entitled to continue your Medical and Dental insurance coverage under COBRA. If you are entitled to COBRA continuation coverage, you will receive a notice of your right to elect COBRA. |
Retiree Medical and Dental Benefits: | If you were eligible for P&G retiree healthcare coverage on your Last Day of Employment, you will be eligible to enroll in P&G’s retiree medical and dental insurance coverage. You are eligible for P&G retiree healthcare coverage if you satisfy the regular retiree eligibility rules (i.e., you are a Regular Retiree) as of your Last Day of Employment. Under the terms of this Agreement, you also are eligible for P&G retiree healthcare coverage as a Special Retiree by satisfying the Rule of 70 as of your Last Day of Employment. You satisfy the Rule of 70 when your full years of age plus your full years of service equal 70*. If you are eligible for P&G’s retiree healthcare coverage as either a Regular Retiree or a Special Retiree as of your Last Day of Employment, you should contact the Employee Service Center before your extension of coverage ends to request retiree healthcare enrollment information. For details regarding the terms and conditions of your retiree health coverage, please refer to and review the summary plan descriptions, available at PGOneàLife and Career Important Note: If you become employed by a direct competitor of P&G (as determined by P&G’s Chief Human Resources Officer) in an officer and/or director capacity, you will not be eligible for coverage under P&G’s retiree healthcare coverage as long as you remain employed by such competitor. If you have questions, please contact the Benefits Service Center at 1-888-627-7472. |
Retiree Life Benefits: | If you are eligible for retiree life coverage on your Last Day of Employment, your Basic Group Life Insurance will convert to Retiree Group Life Insurance. For details regarding the terms and conditions of your Retiree Group Life Insurance coverage, please refer to and review the summary plan descriptions available at PGOneàLife and Career. |
* Special rules apply to Gillette Heritage Employees with regard to retiree medical eligibility and the retiree medical cost sharing under the retiree medical plan. If you are a Gillette Heritage Employee, you will receive a separate handout on your retiree medical eligibility. |
Outplacement Services: | P&G’s outplacement supplier, Right Management Consultants, will provide services to assist you in managing your transition to a new future, based on your interest. Services include pre-decision counseling, career transition programs, and job development opportunities. Right Management Consultants will also assist you in preparing for your job search, including résumé preparation, cover letters, other written materials and interview and networking training. After P&G accepts this Agreement, and after obtaining your manager’s approval, you may begin utilizing outplacement services on a limited basis prior to your Last Day of Employment, consistent with the needs of the business and your responsibilities to complete and/or transition your work. Note that you must begin utilizing outplacement services within 45 days of your Last Day of Employment to be eligible for this benefit. |
Retraining: | You are eligible for reimbursement (up to $5,000) for the cost of tuition, registration and laboratory fees for courses taken at accredited colleges and universities, or at 2-year colleges, trade schools, or vocational schools approved by appropriate accrediting boards. Correspondence courses which result in credit towards diplomas, degrees, etc. may be acceptable if offered by eligible non-profit institutions. You must have courses approved in advance and submit proof of payment of covered fees and proof (such as a transcript) that the courses were completed successfully. Courses that are recreational in nature, such as golf lessons, will not be approved. All expenses for retraining must be incurred within twenty-four (24) months of your Last Day of Employment. The retraining reimbursement benefit is administered by Right Management Consultants. |
No Consideration Without Executing this Agreement: | You affirm that you understand and agree that you would not receive the separation payment and/or benefits specified in this Agreement without executing this Agreement and fulfilling the promises contained in it. Except as provided in this Agreement or under the terms and conditions of an applicable benefit plan or policy sponsored by P&G, you shall not be due any payments or benefits from P&G in connection with the termination of your employment. |
Continued Employment Through Your Last Day of Employment: | You agree to perform your work and responsibilities as an employee in a satisfactory manner up to and including your Last Day of Employment, including compliance with all provisions of this “Separation Agreement and Release.” If P&G determines that you have engaged in serious misconduct during your employment, you understand and agree that P&G may terminate your employment immediately and will not provide, nor will it be obligated to provide, you will the Separation payment, medical benefits, outplacement, retraining and other benefits described above. If you have already received any such pay or benefits, you agree to repay them to P&G upon demand. |
Nonadmission of Wrongdoing: | You affirm that you understand and agree that neither this Agreement nor the furnishing of the consideration for this Agreement, including the Separation Payment, shall be deemed or construed at any time for any purpose as an admission by P&G of wrongdoing or evidence of any liability or unlawful conduct of any kind. |
Release of Claims – Including Age Discrimination and Employment Claims: | In consideration of the Separation Payment and other benefits provided above to which you would not have been entitled under any existing P&G Policy, you release P&G from any and all claims you have against P&G. The term “P&G” includes «Company» and any of its present, former and future owners, parents, affiliates and subsidiaries, and its and their directors, officers, shareholders, employees, agents, servants, representatives, predecessors, successors and assigns and their employee benefit plans and programs and their administrators and fiduciaries. This release applies to claims about which you now know or may later discover, and includes but is not limited to: (1) claims arising under the Age Discrimination in Employment Act, 29 U.S.C. § 621, et seq.; (2) claims arising out of or relating in any way to your employment with P&G or the conclusion of that employment; (3) claims arising under any federal, state and local employment discrimination laws, regulations or ordinances or other orders that relate to the employment relationship and/or employee benefits; and (4) any other federal, state or local law, rule, regulation or ordinance, public policy, contract, tort or common law. This release does not apply to claims that may arise after the date you accept this Agreement or that may not be released under applicable law. You are not waiving any rights you may have to: (a) your own vested accrued employee benefits under the P&G health, welfare, or retirement benefit plans as of the Last Day of Employment; (b) benefits and/or the right to seek benefits under applicable workers’ compensation and/or unemployment compensation statutes; (c) pursue claims which by law cannot be waived by signing this Agreement; (d) enforce this Agreement; and/or (e) challenge the validity of this Agreement. You agree that the decision that your last day of employment would be on the Last Day of Employment was made prior to your accepting and executing this Agreement, and you agree that you are releasing any claim in connection with the separation of your employment. Nothing in this Agreement prohibits or prevents you from filing a charge with or participating, testifying, or assisting in any investigation, hearing, or other proceeding before any federal, state, or local government agency. However, to the maximum extent permitted by law, you agree that if such an administrative claim is made, you shall not be entitled to recover any individual monetary relief or other individual remedies. If any claim is not subject to release, to the extent permitted by law, you agree that you waive any right or ability to be a class or collective action representative or to otherwise participate in any putative or certified class, collective or multi-party action or proceeding based on such a claim in which P&G is a party. |
Confidential, Proprietary, Trade Secret Information & Period of Non-Competition: | You agree that you will not use or share any confidential, proprietary or trade secret information about any aspect of P&G’s business with any non-P&G employee or business entity at any time in the future. You further agree that you will not obtain or have in your possession any confidential, proprietary or trade secret information on or after your last day of employment. Confidential, proprietary or trade secret information includes, but is not limited to, marketing and advertising plans, pricing information, upstream plans, specific areas of research and development, project work, product formulation, processing methods, assignments of individual employees, testing and evaluation procedures, cost figures, construction plans, and special techniques or methods of any kind. Additional non-compete obligation for management employees only: You understand and agree that, unless you have prior written consent from P&G, you will not engage in any activity or provide any services for a period of three (3) years following your Last Day of Employment in connection with the manufacture, development, advertising, promotion or sale of any product which is the same as, similar to, or competitive with any products of P&G or its subsidiaries (including both existing products as well as products in development which are known to you, as a consequence of your employment with P&G): 1. With respect to which your work has been directly concerned at any time during the two (2) years preceding your Last Day of Employment; or 2. With respect to which during that period of time you, as a consequence of your job performance and duties, acquired knowledge of trade secrets or other confidential information of P&G. For the purposes of this section, it shall be conclusively presumed that you have knowledge or information to which you were directly exposed through the actual receipt of memos or documents containing such information or through actual attendance at meetings at which such information was discussed or disclosed. The provisions of this section are not in lieu of, but are in addition to, your continuing obligation to not use or disclose P&G’s trade secrets and confidential information known to you until any particular trade secret or confidential information becomes generally known (through no fault of yours). Information regarding products in development, in test market or being marketed or promoted in a discrete geographic region, which information P&G is considering for a broader use, shall not be deemed generally known until such broader use is actually commercially implemented. Also, “generally known” means known throughout the domestic United States industry or, if you have job responsibilities outside of the United States, the appropriate foreign country or countries’ industry. If any restriction in this section is found by any court of competent jurisdiction or arbitrator to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it will be modified and interpreted to extend only over the maximum period of time, range of activities or geographic area so that it may be enforceable. If you are a participant in the 2009 Stock and Incentive Compensation Plan, the 2001 Stock and Incentive Compensation Plan, or the 1992 Stock Plan, you are also bound by the terms of Article F – Restrictions & Covenants of those plans, which are incorporated herein by reference. If you are a participant in the 2014 Stock & Incentive Compensation Plan, you are also bound by the terms of Article 6 – Restrictions and Covenants of this plan which are incorporated herein by reference. |
Acknowledgements and Affirmations: | You affirm that you have not filed, caused to be filed, or presently are a party to any claim against P&G. You affirm that you have been paid and/or have received all compensation, wages, bonuses, commissions, and/or benefits which are due and payable as of the date you sign this Agreement. To the extent that you are required to report hours worked, you affirm that you have reported all hours worked as of the date you sign this Agreement. You affirm that you have been granted any leave to which you were entitled under the Family and Medical Leave Act or related state or local leave or disability accommodation laws. You further affirm that you have no known workplace injuries or occupational diseases that have not been reported. |
Assignment of Intellectual Property: | You will promptly and fully disclose, transfer and assign to P&G all inventions and any other intellectual property (collectively “Intellectual Property”) made or conceived by you during your employment with P&G. You agree to fully cooperate in executing any papers required for establishing or protecting the Intellectual Property and for establishing P&G’s ownership, even if such cooperation is necessary after your Last Day of Employment. |
Return of P&G Property: | You agree that on or before your Last Day of Employment, you will return to P&G in good condition all of its equipment, materials and information that were in your possession, custody or control (including, but not limited to, computers, files, documents, credit cards, keys and identification badges). You further agree that you will provide your manager with all passwords to P&G electronic communication and data systems before your Last Day of Employment. You further agree that on or before your Last Day of Employment, you will return or if directed to do so by your immediate manager, delete (i.e., destroy all copies of) any and all P&G confidential, proprietary or trade secret information you have maintained in your possession, custody, or control in paper, electronic and/or digital formats, including but not limited to, any such confidential, proprietary, or trade secret information (e.g., files, documents, etc.) that you may have electronically or digitally processed or stored on P&G-issued or on personally-owned or maintained digital devices and/or service accounts. Such digital devices and/or service accounts may include, but are not limited to desktop and laptop computers, notebooks, tablets, iPads, mobile phones, smartphones, personal digital assistants (PDAs), USB and flash drives, external hard drives, CDs, DVDs, and/or external file processing or storage provided by cloud service providers such as box.net, dropbox, Google docs, etc. |
Ethics Compliance: | You agree that you provided P&G all information known to you regarding any violations of the Procter & Gamble Worldwide Business Conduct Manual and/or any other violations of P&G policy or the law. |
Agreement to Arbitrate Disputes: | Resolving any future differences we may have in the courts can take a long time and be expensive. You and P&G therefore agree that the only remedy for all disputes that are not released by this Agreement or that arise out of your employment with or separation from P&G, or any aspect of this Agreement, will be to submit any such disputes (with the exception noted at the end of this section) to final and binding arbitration in accordance with the National Rules for Resolution of Employment Disputes of the American Arbitration Association then in effect. You and P&G agree that the aggrieved party must send written notice of any claim to the other party by certified mail, return receipt requested. Written notice for P&G will be sent to: Secretary, One Procter & Gamble Plaza, Cincinnati, OH 45202, and to you at the most current address shown for you in P&G’s records. The arbitrator will apply Ohio law. At your written request, P&G will reimburse you for all fees and costs charged by the American Arbitration Association and its arbitrator to the extent they exceed the applicable fees and costs that would have been charged by a court of competent jurisdiction had your claim been filed in court. There is one exception to this section. P&G may seek injunctive relief in any court of competent jurisdiction if it has reason to believe that you have violated or are about to violate (1) the terms of the “Confidential, Proprietary, Trade Secret Information & Period of Non-Competition” section above, or (2) if you are a participant in the 2009 Stock and Incentive Compensation Plan, the 2001 Stock and Incentive Compensation Plan, or the 1992 Stock Plan, the terms of Article F – Restrictions & Covenants of those plans. |
Severability: | If any court of competent jurisdiction or arbitrator should later find that any portion of this Agreement is invalid, that invalidity will not affect the enforceability of any other portion of this Agreement. |
Employment References: | You understand that P&G’s historical policy is to not provide employment references to prospective employers. However, P&G is willing to waive that policy in your case on the following basis: You authorize your manager or human resources representative to provide an employment reference upon written or verbal request. In return, you release any claim against P&G and will not bring a lawsuit in court against P&G based upon that employment reference (or lack thereof). You agree that you will refer all reference inquiries to your manager or human resources representative only. You further understand that all disputes regarding employment references or the lack thereof must be resolved through the arbitration process described above. |
No Reliance: | This Agreement sets forth the entire agreement between you and P&G and fully supersedes any prior agreements or understanding between the parties except that if you are a participant in the 2009 Stock and Incentive Compensation Plan, the 2001 Stock and Incentive Compensation Plan, or the 1992 Stock Plan, the terms of Article F – Restrictions & Covenants of those plans remain in full force and effect and are incorporated herein by reference and if you are a participant in the 2014 Stock Plan, the terms of Article 6 – Restrictions & Covenants of the plan remain in full force and are in effect and are incorporated herein by reference. In deciding to accept this Agreement, you agree that you have not relied upon any statements or promises by P&G, its managers, agents or employees, other than those set forth in this Agreement. No other promises or agreements concerning the matters described in this Agreement shall be binding unless in a subsequent document signed by these parties. |
Your Attorney: | You acknowledge that you have been and hereby are advised to consult with legal counsel before accepting this Agreement and have either done so or have voluntarily declined to do so. |
Timing for Acceptance or Revocation: | You have forty-five (45) calendar days in which to consider this Agreement in which you waive important rights, including those under the Age Discrimination in Employment Act of 1967. If you choose to sign this Agreement, please do so by indicating your acceptance of this Agreement with your electronic signature in P&G’s electronic system. We advise you to consult with an attorney of your choosing prior to signing this Agreement. Further, you may within seven (7) calendar days of the Company accepting your offer, cancel and terminate the Agreement by giving written notice of your intention to revoke the Agreement to your immediate manager, and by returning to P&G any remuneration or benefits that have been advanced to you in anticipation of your not revoking your Agreement and to which you are not entitled. If notice of your revocation is mailed, it must be postmarked within seven (7) calendar days after you sign this Agreement. You understand that in total, you will have had more than seven (7) dates to revoke this Agreement from the date on which you submitted your intent to participate in this Voluntary Separation Program. You agree that any modifications, material or otherwise, made to this Agreement, do not restart or affect in any manner the original up to forty-five (45) calendar day consideration period. |
Eligibility Information for Group Program Under The Older Workers Benefits Protection Act: | If your separation and the offer of separation pay and benefits set forth in this Agreement is part of a program offered to a group of employees, attached to this Agreement is information regarding the class, unit, or group of individuals covered by such program, any eligibility factors, any time limits associated with the program, and a list showing, on the one hand, the ages and job titles of P&G employees in the job classifications or organizational units who were eligible or selected to participate in the program, and also showing, on the other hand, the ages and job titles of those employees in the same job classifications or organizational units who were not eligible or selected for the program. You further acknowledge that you received the information described in this section. |
Last Day of Employment: | Your last day of employment will be «Exit_Date», referred to as your “Last Day of Employment.” Unless otherwise noted below, your pay and benefits will cease as of your Last Day of Employment. |
Separation Payment: | As soon as administratively practical after your Last Day of Employment, P&G will provide you with a Separation Payment of «Total_Amount», less legally required withholdings and deductions. In no event will payment be made before expiration of the seven-day revocation period discussed below or later than the March 15th of the year following the year which includes your last day of employment. Amounts you owe to P&G as of your Last Day of Employment, including, but not limited to, wage and/or benefit overpayments and unpaid loans, will also be deducted from the Separation Payment. |
Payment for Unvested PST: | If you are not fully-vested in the Procter & Gamble Profit Sharing Trust and Employee Stock Ownership Plan (“PST”) as of your Last Day of Employment, as soon as administratively practical after your Last Day of Employment, but no later than the March 15th of the year following the year which includes your Last Day of Employment, you will receive a lump sum payment in an amount substantially equivalent to the non-vested credits in your account in the PST. |
STAR Awards: | As of your Last Day of Employment, if you were otherwise eligible for a STAR award and you worked at least 28 days (4 calendar weeks) during that fiscal year, you will receive a pro-rated STAR award for that fiscal year. Your STAR award will be pro-rated by dividing the number of calendar days during the fiscal year from July 1 through your Last Day of Employment by 365. Your STAR award will be paid in cash in the September (but no later than September 15th) immediately following the end of the fiscal year in which you terminate. |
Equity Awards (including Recognition Shares): | Your separation will be treated as a Special Separation for purposes of any outstanding equity awards granted under the Procter & Gamble 2009 Stock and Incentive Compensation Plan, the Procter & Gamble 2001 Stock and Incentive Compensation Plan, the Procter & Gamble 1992 Stock Plan, or the Gillette Company 2004 Long-Term Incentive Plan and as a result the awards will be retained subject to the original terms and conditions of the awards. Awards granted under the Procter & Gamble 2014 Stock & Incentive Compensation Plan are retained subject to the terms and conditions of the Awards. This agreement does not alter the rights and obligations that you may have under the Procter & Gamble 2014 Stock & Incentive compensation Plan, the Procter & Gamble 2009 Stock and Incentive Compensation Plan, the Procter & Gamble 2001 Stock and Incentive Plan, the Procter & Gamble 1992 Stock Plan, and the Gillette Company 2004 Long-Term Incentive Plan. |
Current Medical, Dental, and Life Insurance Benefits: | Your Medical (including prescription drug and EAP programs), Dental, and Basic Group Life insurance coverage will continue under the same terms until «Benefits_End_Date». When your extended coverage ends, you may be entitled to continue your Medical and Dental insurance coverage under COBRA. If you are entitled to COBRA continuation coverage, you will receive a notice of your right to elect COBRA. |
Retiree Medical and Dental Benefits: | If you were eligible for P&G retiree healthcare coverage on your Last Day of Employment, you will be eligible to enroll in P&G’s retiree medical and dental insurance coverage. You are eligible for P&G retiree healthcare coverage if you satisfy the regular retiree eligibility rules (i.e., you are a Regular Retiree) as of your Last Day of Employment. Under the terms of this Agreement, you also are eligible for P&G retiree healthcare coverage as a Special Retiree by satisfying the Rule of 70 as of your Last Day of Employment. You satisfy the Rule of 70 when your full years of age plus your full years of service equal 70. If you are eligible for P&G’s retiree healthcare coverage as either a Regular Retiree or a Special Retiree as of your Last Day of Employment, you should contact the Employee Service Center before your extension of coverage ends to request retiree healthcare enrollment information. For details regarding the terms and conditions of your retiree health coverage, please refer to and review the summary plan descriptions, available at PGOneàLife and Career Important Note: If you become employed by a direct competitor of P&G (as determined by P&G’s Chief Human Resources Officer) in an officer and/or director capacity, you will not be eligible for coverage under P&G’s retiree healthcare coverage as long as you remain employed by such competitor. If you have questions, please contact the Benefits Service Center at 1-888-627-7472. |
Retiree Life Benefits: | If you are eligible for retiree life coverage on your Last Day of Employment, your Basic Group Life Insurance will convert to Retiree Group Life Insurance. For details regarding the terms and conditions of your Retiree Group Life Insurance coverage, please refer to and review the summary plan descriptions available at PGOneàLife and Career. |
Outplacement Services: | P&G’s outplacement supplier, Right Management Consultants, will provide services to assist you in managing your transition to a new future, based on your interest. Services include pre-decision counseling, career transition programs, and job development opportunities. Right Management Consultants will also assist you in preparing for your job search, including résumé preparation, cover letters, other written materials and interview and networking training. After P&G accepts this Agreement, and after obtaining your manager’s approval, you may begin utilizing outplacement services on a limited basis prior to your Last Day of Employment, consistent with the needs of the business and your responsibilities to complete and/or transition your work. Note that you must begin utilizing outplacement services within 45 days of your Last Day of Employment to be eligible for this benefit. |
Retraining: | You are eligible for reimbursement (up to $5,000) for the cost of tuition, registration and laboratory fees for courses taken at accredited colleges and universities, or at 2-year colleges, trade schools, or vocational schools approved by appropriate accrediting boards. Correspondence courses which result in credit towards diplomas, degrees, etc. may be acceptable if offered by eligible non-profit institutions. You must have courses approved in advance and submit proof of payment of covered fees and proof (such as a transcript) that the courses were completed successfully. Courses that are recreational in nature, such as golf lessons, will not be approved. All expenses for retraining must be incurred within twenty-four (24) months of your Last Day of Employment. The retraining reimbursement benefit is administered by Right Management Consultants. |
No Consideration Without Executing this Agreement: | You affirm that you understand and agree that you would not receive the separation payment and/or benefits specified in this Agreement without executing this Agreement and fulfilling the promises contained in it. Except as provided in this Agreement or under the terms and conditions of an applicable benefit plan or policy sponsored by P&G, you shall not be due any payments or benefits from P&G in connection with the termination of your employment. |
Continued Employment Through Your Last Day of Employment: | You agree to perform your work and responsibilities as an employee in a satisfactory manner up to and including your Last Day of Employment, including compliance with all provisions of this “Separation Agreement and Release.” If P&G determines that you have engaged in serious misconduct during your employment, you understand and agree that P&G may terminate your employment immediately and will not provide, nor will it be obligated to provide, you will the Separation payment, medical benefits, outplacement, retraining and other benefits described above. If you have already received any such pay or benefits, you agree to repay them to P&G upon demand. |
Nonadmission of Wrongdoing: | You affirm that you understand and agree that neither this Agreement nor the furnishing of the consideration for this Agreement, including the Separation Payment, shall be deemed or construed at any time for any purpose as an admission by P&G of wrongdoing or evidence of any liability or unlawful conduct of any kind. |
Release of Claims – Including Age Discrimination and Employment Claims: | In consideration of the Separation Payment and other benefits provided above to which you would not have been entitled under any existing P&G Policy, you release P&G from any and all claims you have against P&G. The term “P&G” includes «Company» and any of its present, former and future owners, parents, affiliates and subsidiaries, and its and their directors, officers, shareholders, employees, agents, servants, representatives, predecessors, successors and assigns and their employee benefit plans and programs and their administrators and fiduciaries. This release applies to claims about which you now know or may later discover, and includes but is not limited to: (1) claims arising under the Age Discrimination in Employment Act, 29 U.S.C. § 621, et seq.; (2) claims arising out of or relating in any way to your employment with P&G or the conclusion of that employment; (3) claims arising under any federal, state and local employment discrimination laws, regulations or ordinances or other orders that relate to the employment relationship and/or employee benefits; (4) claims under California state and local statutes, rules and regulations including but not limited to (a) California Family Rights Act – Cal. Gov’t Code § 12945.2; (b) California Fair Employment and Housing Act – Cal. Gov’t Code § 12900 et seq.; (c) California Unruh Civil Rights Act – Cal. Civ. Code § 51 et seq.; (d) Statutory Provisions Regarding the Confidentiality of AIDS Information – Cal. Health & Safety Code § 120775 et seq.; (e) California Confidentiality of Medical Information Act – Cal. Civ. Code § 56 et seq.; (f) California Parental Leave Law – Cal. Lab. Code § 230.7 et seq.; (g) California Apprenticeship Program Bias Law – Cal. Lab. Code § 3070 et seq.; (h) California Equal Pay Law – Cal. Lab. Code § 1197.5; (i) California Whistleblower Protection Law – Cal. Lab. Code § 1102.5; (j) California Military Personnel Bias Law – Cal. Mil. & Vet. Code § 394; (k) Statutory Provision Regarding California Family and Medical Leave – Cal. Lab. Code § 233; (l) Statutory Provisions Regarding California Electronic Monitoring of Employees – Cal. Lab. Code § 435; (m) the California Occupational Safety and Health Act, as amended; (n) California Labor Code § 6300 et seq., and any applicable regulations thereunder; (o) California Obligations of Investigative Consumer Reporting Agencies Law – Cal. Civ. Code § 1786.10 et seq.; (p) California Political Activities of Employees Law – Cal. Lab. Code § 1101 et seq.; (q) California Domestic Violence Victim Employment Leave Law – Cal. Lab. Code § 230.1; (r) California Court Leave Law – Cal. Lab. Code § 230; (s) those other provisions of the California Labor Code that lawfully may be released; (t) Los Angeles AIDS-Based Discrimination Ordinance, Los Angeles Municipal Ordinance §45.80 et seq.; (u) California Labor Code § 132a; and (5) any other federal, state or local law, rule, regulation or ordinance, public policy, contract, tort or common law. This release does not apply to claims that may arise after the date you accept this Agreement or that may not be released under applicable law. You are not waiving any rights you may have to: (a) your own vested accrued employee benefits under the P&G health, welfare, or retirement benefit plans as of the Employment Separation Date; (b) benefits and/or the right to seek benefits under applicable workers’ compensation statutes (except as to claims under Labor Code sections 132a and 4553) and/or unemployment compensation statutes; (c) pursue claims which by law cannot be waived by signing this Agreement; (d) enforce this Agreement; and/or (e) challenge the validity of this Agreement. You agree that the decision that your last day of employment would be on the Employment Separation Date was made prior to your accepting and executing this Agreement, and you agree that you are releasing any claim in connection with the separation of your employment. Nothing in this Agreement prohibits or prevents you from filing a charge with or participating, testifying, or assisting in any investigation, hearing, or other proceeding before any federal, state, or local government agency. However, to the maximum extent permitted by law, you agree that if such an administrative claim is made, you shall not be entitled to recover any individual monetary relief or other individual remedies. If any claim is not subject to release, to the extent permitted by law, you agree that you waive any right or ability to be a class or collective action representative or to otherwise participate in any putative or certified class, collective or multi-party action or proceeding based on such a claim in which P&G is a party. Waiver of California Civil Code Section 1542. To effect a full and complete general release as described above, you expressly waive and relinquish all rights and benefits of Section 1542 of the Civil Code of the State of California and do so understanding and acknowledging the significance and consequence of specifically waiving Section 1542. Section 1542 of the Civil Code of the State of California states as follows: A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor. Thus, notwithstanding the provisions of Section 1542, and to implement a full and complete release and discharge of P&G, you expressly acknowledge this Agreement is intended to include in its effect, without limitation, all claims you do not know or suspect to exist in your favor at the time of signing this Agreement, and that this Agreement contemplates the extinguishment of any such claims. You warrant that you have read this Agreement, including this waiver of California Civil Code Section 1542, and that You have consulted with or had the opportunity to consult with counsel of your choosing about this Agreement and specifically about the waiver of Section 1542, and that you understand this Agreement and the Section 1542 waiver, and so you freely and knowingly enters into this Agreement. You further acknowledge that you later may discover facts different from or in addition to those you know or believe to be true regarding the matters released or described in this Agreement, and even so you agree that the releases and agreements contained in this Agreement shall remain effective in all respects notwithstanding any later discovery of any or additional facts. You expressly assume any and all risk of any mistake in connection with the true involved in the matters, disputes, or controversies released or described in this Agreement to with regard to any facts now unknown to you relating thereto. |
Confidential, Proprietary, Trade Secret Information: | You agree that you will not use or share any confidential, proprietary or trade secret information about any aspect of P&G’s business with any non-P&G employee or business entity at any time in the future. You further agree that you will not obtain or have in your possession any confidential, proprietary or trade secret information on or after your last day of employment. Confidential, proprietary or trade secret information includes, but is not limited to, marketing and advertising plans, pricing information, upstream plans, specific areas of research and development, project work, product formulation, processing methods, assignments of individual employees, testing and evaluation procedures, cost figures, construction plans, and special techniques or methods of any kind. For the purposes of this section, it shall be conclusively presumed that you have knowledge or information to which you were directly exposed through the actual receipt of memos or documents containing such information or through actual attendance at meetings at which such information was discussed or disclosed. The provisions of this section are not in lieu of, but are in addition to, your continuing obligation to not use or disclose P&G’s trade secrets and confidential information known to you until any particular trade secret or confidential information becomes generally known (through no fault of yours). Information regarding products in development, in test market or being marketed or promoted in a discrete geographic region, which information P&G is considering for a broader use, shall not be deemed generally known until such broader use is actually commercially implemented. Also, “generally known” means known throughout the domestic United States industry or, if you have job responsibilities outside of the United States, the appropriate foreign country or countries’ industry. If any restriction in this section is found by any court of competent jurisdiction or arbitrator to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it will be modified and interpreted to extend only over the maximum period of time, range of activities or geographic area so that it may be enforceable. |
Acknowledgements and Affirmations: | You affirm that you have not filed, caused to be filed, or presently are a party to any claim against P&G. You affirm that you have been paid and/or have received all compensation, wages, bonuses, commissions, and/or benefits which are due and payable as of the date you sign this Agreement. To the extent that you are required to report hours worked, you affirm that you have reported all hours worked as of the date you sign this Agreement. You also affirm that you have been reimbursed for all necessary business expenses. You affirm that you have been granted any leave to which you were entitled under the Family and Medical Leave Act or related state or local leave or disability accommodation laws. You further affirm that you have no known workplace injuries or occupational diseases that have not been reported and that you have not been retaliated against for sustaining any work-related injury or filing any worker’s compensation claims. |
Assignment of Intellectual Property: | You will promptly and fully disclose, transfer and assign to P&G all inventions and any other intellectual property (collectively “Intellectual Property”) made or conceived by you during your employment with P&G. You agree to fully cooperate in executing any papers required for establishing or protecting the Intellectual Property and for establishing P&G’s ownership, even if such cooperation is necessary after your Last Day of Employment. |
Return of P&G Property: | You agree that on or before your Last Day of Employment, you will return to P&G in good condition all of its equipment, materials and information that were in your possession, custody or control (including, but not limited to, computers, files, documents, credit cards, keys and identification badges). You further agree that you will provide your manager with all passwords to P&G electronic communication and data systems before your Last Day of Employment. You further agree that on or before your Last Day of Employment, you will return or if directed to do so by your immediate manager, delete (i.e., destroy all copies of) any and all P&G confidential, proprietary or trade secret information you have maintained in your possession, custody, or control in paper, electronic and/or digital formats, including but not limited to, any such confidential, proprietary, or trade secret information (e.g., files, documents, etc.) that you may have electronically or digitally processed or stored on P&G-issued or on personally-owned or maintained digital devices and/or service accounts. Such digital devices and/or service accounts may include, but are not limited to desktop and laptop computers, notebooks, tablets, iPads, mobile phones, smartphones, personal digital assistants (PDAs), USB and flash drives, external hard drives, CDs, DVDs, and/or external file processing or storage provided by cloud service providers such as box.net, dropbox, Google docs, etc. |
Ethics Compliance: | You agree that you provided P&G all information known to you regarding any violations of the Procter & Gamble Worldwide Business Conduct Manual and/or any other violations of P&G policy or the law. |
Agreement to Arbitrate Disputes: | Resolving any future differences we may have in the courts can take a long time and be expensive. You and P&G therefore agree that the only remedy for all disputes that are not released by this Agreement or that arise out of your employment with or separation from P&G, or any aspect of this Agreement, will be to submit any such disputes (with the exception noted at the end of this section) to final and binding arbitration in accordance with the National Rules for Resolution of Employment Disputes of the American Arbitration Association then in effect. You and P&G agree that the aggrieved party must send written notice of any claim to the other party by certified mail, return receipt requested. Written notice for P&G will be sent to: Secretary, One Procter & Gamble Plaza, Cincinnati, OH 45202, and to you at the most current address shown for you in P&G’s records. The arbitrator will apply Ohio law. At your written request, P&G will reimburse you for all fees and costs charged by the American Arbitration Association and its arbitrator to the extent they exceed the applicable fees and costs that would have been charged by a court of competent jurisdiction had your claim been filed in court. There is one exception to this section. P&G may seek injunctive relief in any court of competent jurisdiction if it has reason to believe that you have violated or are about to violate (1) the terms of the “Confidential, Proprietary, Trade Secret Information & Period of Non-Competition” section above, or (2) if you are a participant in the 2009 Stock and Incentive Compensation Plan, the 2001 Stock and Incentive Compensation Plan, or the 1992 Stock Plan, the terms of Article F – Restrictions & Covenants of those plans. |
Severability: | If any court of competent jurisdiction or arbitrator should later find that any portion of this Agreement is invalid, that invalidity will not affect the enforceability of any other portion of this Agreement. |
Employment References: | You understand that P&G’s historical policy is to not provide employment references to prospective employers. However, P&G is willing to waive that policy in your case on the following basis: You authorize your manager or human resources representative to provide an employment reference upon written or verbal request. In return, you release any claim against P&G and will not bring a lawsuit in court against P&G based upon that employment reference (or lack thereof). You agree that you will refer all reference inquiries to your manager or human resources representative only. You further understand that all disputes regarding employment references or the lack thereof must be resolved through the arbitration process described above. |
No Reliance: | This Agreement sets forth the entire agreement between you and P&G and fully supersedes any prior agreements or understanding between the parties except that if you are a participant in the 2009 Stock and Incentive Compensation Plan, the 2001 Stock and Incentive Compensation Plan, or the 1992 Stock Plan, the terms of Article F – Restrictions & Covenants of those plans remain in full force and effect and are incorporated herein by reference and if you are a participant in the 2014 Stock Plan, the terms of Article 6 – Restrictions & Covenants of the plan remain in full force and are in effect and are incorporated herein by reference. In deciding to accept this Agreement, you agree that you have not relied upon any statements or promises by P&G, its managers, agents or employees, other than those set forth in this Agreement. No other promises or agreements concerning the matters described in this Agreement shall be binding unless in a subsequent document signed by these parties. |
Your Attorney: | You acknowledge that you have been and hereby are advised to consult with legal counsel before accepting this Agreement and have either done so or have voluntarily declined to do so. |
Timing for Acceptance or Revocation: | You have forty-five (45) calendar days in which to consider this Agreement in which you waive important rights, including those under the Age Discrimination in Employment Act of 1967. If you choose to sign this Agreement, please do so by indicating your acceptance of this Agreement with your electronic signature in P&G’s electronic system. We advise you to consult with an attorney of your choosing prior to signing this Agreement. Further, you may within seven (7) calendar days of the Company accepting your offer, cancel and terminate the Agreement by giving written notice of your intention to revoke the Agreement to your immediate manager, and by returning to P&G any remuneration or benefits that have been advanced to you in anticipation of your not revoking your Agreement and to which you are not entitled. If notice of your revocation is mailed, it must be postmarked within seven (7) calendar days after you sign this Agreement. You understand that in total, you will have had more than seven (7) dates to revoke this Agreement from the date on which you submitted your intent to participate in this Voluntary Separation Program. You agree that any modifications, material or otherwise, made to this Agreement, do not restart or affect in any manner the original up to forty-five (45) calendar day consideration period. |
Eligibility Information for Group Program Under The Older Workers Benefits Protection Act: | If your separation and the offer of separation pay and benefits set forth in this Agreement is part of a program offered to a group of employees, attached to this Agreement is information regarding the class, unit, or group of individuals covered by such program, any eligibility factors, any time limits associated with the program, and a list showing, on the one hand, the ages and job titles of P&G employees in the job classifications or organizational units who were eligible or selected to participate in the program, and also showing, on the other hand, the ages and job titles of those employees in the same job classifications or organizational units who were not eligible or selected for the program. You further acknowledge that you received the information described in this section. |
1. | Termination on Account of Death. In the event of death, the Vest Date for this Award becomes your date of death and the Award remains exercisable until the Expiration Date. |
2. | Termination on Account of Retirement or Disability after June 30th of the fiscal year in which this Award was granted. In the event of Retirement or Disability, respectively, that occurs after June 30th of the fiscal year in which this Award was granted, the Award is not forfeited and will be exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan and the Regulations. |
3. | Termination after June 30th of the fiscal year in which this Award was granted pursuant to a Written Separation Agreement. In the event of Termination of Employment from the Company or a Subsidiary that occurs after June 30th of the fiscal year in which this Award was granted, your Award is forfeited unless you have executed a written separation agreement with the Company or a Subsidiary that provides for retention of the Award. If the Award is retained pursuant to a separation agreement, the Award will become exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan, the Regulations and the separation agreement. |
4. | Termination in connection with a divestiture or separation of any of the Company’s businesses. In the event of Termination of Employment from the Company in connection with a divestiture or separation of any of the Company’s businesses, as determined by the Company’s Chief Human Resources Officer, the Award is retained and will become exercisable |
1. | Termination on Account of Death. In the case of death, the Vest Date for this Award becomes your date of death and the Award remains exercisable until the Expiration Date. |
2. | Termination on Account of Retirement or Disability after June 30th of the fiscal year in which this Award was granted. In the case of Retirement or Disability, respectively, that occurs after June 30th of the fiscal year in which this Award was granted, the Award is not forfeited and will be exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan and the Regulations. |
3. | Termination after June 30th of the fiscal year in which this Award was granted pursuant to a Written Separation Agreement. In the event of Termination of Employment from the Company or a Subsidiary that occurs after June 30th of the fiscal year in which this Award was granted, your Award is forfeited unless you have executed a written separation agreement with the Company or a Subsidiary that provides for retention of the Award. If the Award is retained pursuant to a separation agreement, the Award will become exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan, the Regulations and the separation agreement. |
4. | Termination in connection with a divestiture or separation of any of the Company’s businesses. In the event of Termination of Employment from the Company in connection with a divestiture or separation of any of the Company’s businesses, as determined by the Company’s Chief Human Resources Officer, the Award is retained and will become exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan and the Regulations. |
1. | Termination on Account of Death. In the case of death, the Vest Date for this Award becomes your date of death and the Award remains exercisable until the first anniversary of your date of death. |
2. | Termination on Account of Retirement or Disability after June 30th of the fiscal year in which this Award was granted. In the case of Retirement or Disability, respectively, that occurs after June 30th of the fiscal year in which this Award was granted, the Award is not forfeited and will be exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan and the Regulations. |
3. | Termination after June 30th of the fiscal year in which this Award was granted pursuant to a Written Separation Agreement. In the event of Termination of Employment that occurs after June 30th of the fiscal year in which this Award was granted, your Award is forfeited unless you have executed a written |
4. | Termination in connection with a divestiture or separation of any of the Company’s businesses. In the event of Termination of Employment from the Company in connection with a divestiture or separation of any of the Company’s businesses, as determined by the Company’s Chief Human Resources Officer, the Award is retained and will become exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan and the Regulations. |
1. | Termination on Account of Death. In the case of death, the Vest Date for this Award becomes your date of death and the Award remains exercisable until the Expiration Date. |
2. | Termination on Account of Retirement or Disability after June 30th of the fiscal year in which this Award was granted. In the case of Retirement or Disability, respectively, that occurs after June 30th of the fiscal year in which this Award was granted, the Award is not forfeited and will be exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan and the Regulations. |
3. | Termination after June 30th of the fiscal year in which this Award was granted pursuant to a Written Separation Agreement. In the event of Termination of Employment from the Company or a Subsidiary that occurs after June 30th of the fiscal year in which this Award was granted, your Award is forfeited unless you have executed a written separation agreement with the Company or a Subsidiary that provides for retention of the Award. If the Award is retained pursuant to a separation agreement, the Award will become exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan, the Regulations and the separation agreement. |
4. | Termination in connection with a divestiture or separation of any of the Company’s businesses. In the event of Termination of Employment from the Company in connection with a divestiture or separation of any of the Company’s businesses, as determined by the Company’s Chief Human Resources Officer, the Award is retained and will become exercisable |
1. | Termination on Account of Death. In the case of death, the Vest Date for this Award becomes your date of death and the Award remains exercisable until the Expiration Date. |
2. | Termination on Account of Retirement or Disability after June 30th of the fiscal year in which this Award was granted. In the case of Retirement or Disability, respectively, that occurs after June 30th of the fiscal year in which this Award was granted, the Award is not forfeited and will be exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan and the Regulations. |
3. | Termination after June 30th of the fiscal year in which this Award was granted pursuant to a Written Separation Agreement. In the event of Termination of Employment from the Company or a Subsidiary that occurs after June 30th of the fiscal year in which this Award was granted, your Award is forfeited unless you have executed a written separation agreement with the Company or a Subsidiary that provides for retention of the Award. If the Award is retained pursuant to a separation agreement, the Award will become exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan, the Regulations and the separation agreement. |
4. | Termination in connection with a divestiture or separation of any of the Company’s businesses. In the event of Termination of Employment from the Company in connection with a divestiture or separation of any of the Company’s businesses, as determined by the Company’s Chief Human Resources Officer, the Award is retained and will become exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan and the Regulations. |
1. | Termination on Account of Death. In the case of death, the Vest Date for this Award becomes your date of death and the Award remains exercisable until the Expiration Date. |
2. | Termination on Account of Retirement or Disability after June 30th of the fiscal year in which this Award was granted. In the case of Retirement or Disability, respectively, that occurs after June 30th of the fiscal year in which this Award was granted, the Award is not forfeited and will be exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan and the Regulations |
3. | Termination after June 30th of the fiscal year in which this Award was granted pursuant to a Written Separation Agreement. In the event of Termination of Employment that occurs after June 30th of the fiscal year in which this Award was granted, your Award is forfeited unless you have executed a written separation agreement with the Company or a Constituent Company that provides for retention of the Award. If the Award is retained pursuant to a separation agreement, the Award will become exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan, the Regulations and the separation agreement. |
4. | Termination in connection with a divestiture or separation of any of the Company’s businesses. In the event of Termination of Employment from the Company in connection with a divestiture or separation of any of the Company’s businesses, as determined by the Company’s Chief Human Resources Officer, the Award is retained and will become exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan and the Regulations. |
1. | Termination on Account of Death. In the case of death, the Vest Date for this Award becomes your date of death and the Award remains exercisable until the first anniversary of your date of death. |
2. | Termination on Account of Retirement or Disability after June 30th of the fiscal year in which this Award was granted. In the case of Retirement or Disability, respectively, that occurs after June 30th of the fiscal year in which this Award was granted, the Award is not forfeited and will be exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan and the Regulations. |
3. | Termination after June 30th of the fiscal year in which this Award was granted pursuant to a Written Separation Agreement. In the event of Termination of Employment that occurs after June 30th of the fiscal year in which this Award was granted, your Award is forfeited unless you have executed a written separation agreement with the Company or a Constituent Company that provides for retention of the Award. If the Award is retained pursuant to a separation agreement, the Award will become exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan, the Regulations and the separation agreement. |
4. | Termination in connection with a divestiture or separation of any of the Company’s businesses. In the event of Termination of Employment from the Company in connection with a divestiture or separation of any of the Company’s businesses, as determined by the Company’s Chief Human Resources Officer, the Award is retained and will become exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan and the Regulations. |
• | The Schedule 4 CSOP Sub-Plan for the United Kingdom (applies to series 15-F only) |
1. | Parties |
(A) | You, the individual who has obtained access to this Election (the “Employee”), who is eligible to receive stock options (the “Options”) granted by The Procter & Gamble Company of 1 Procter & Gamble Plaza, Cincinnati, OH 45202, U.S.A. pursuant to the terms and conditions of the Procter & Gamble 2014 Stock and Incentive Compensation Plan (the “Plan”), and |
(B) | The Procter & Gamble Company (“P&G” or the “Company”), which may grant Options and/or Restricted Stock Units under the Plan and is entering into this Election on behalf of the Employee’s Employer (“Employer”). |
2. | Purpose of Election |
2.1 | This Election relates to the Employer’s secondary Class 1 National Insurance Contributions (the “Employer’s Liability”) which may arise on the occurrence of a "Taxable Event" pursuant to section 4(4)(a) of the Social Security Contributions and Benefits Act 1992, including: |
(i) | the acquisition of securities pursuant to the Options (pursuant to section 477(3)(a) ITEPA); and/or |
(ii) | the assignment or release of the Options in return for consideration (pursuant to section 477(3)(b) ITEPA); and/or |
(iii) | the receipt of a benefit in connection with the Options other than a benefit within (i) or (ii) above (pursuant to section 477(3)(c) ITEPA); and/or |
(iv) | the acquisition of securities pursuant to Options granted under the Tax Advantaged sub-plan of the Plan in circumstances that do not attract relief from income tax. |
2.2 | This Election applies to all Options granted to the Employee under the Plan on or after January 1, 2015 up to the termination date of the Plan. |
2.3 | This Election does not apply in relation to any liability, or any part of any liability, arising as a result of regulations being given retrospective effect by virtue of section 4B(2) of either the Social Security Contributions and Benefits Act 1992, or the Social Security Contributions and Benefits (Northern Ireland) Act 1992. |
3. | The Election |
4. | Payment of the Employer’s Liability |
4.1 | The Employee hereby authorises the Employer and/or P&G to collect the Employer’s Liability from the Employee at any time after the Taxable Event: |
(i) | by deduction from salary or any other payment payable to the Employee at any time on or after the date of the Taxable Event; and/or |
(ii) | directly from the Employee by payment in cash or cleared funds; and/or |
(iii) | by arranging, on behalf of the Employee, for the sale of some of the securities which the Employee is entitled to receive in respect of the Options; and/or |
(iv) | through any other method as set forth in the award agreement entered into between the Employee and P&G. |
4.2 | The Employer hereby reserves for itself and P&G the right to withhold the transfer of any securities to the Employee until full payment of the Employer’s Liability is received. |
4.3 | The Employer agrees to remit the Employer’s Liability to Her Majesty’s Revenue and Customs (“HMRC”) on behalf of the Employee within 17 days after the end of the UK tax month during which the Taxable Event occurs. |
5. | Duration of Election |
5.1 | The Employee and the Employer agree to be bound by the terms of this Election regardless of whether the Employee is transferred abroad or is not employed by the Employer on the date on which the Employer’s Liability becomes due. |
5.2 | This Election will continue in effect until the earliest of the following: |
(i) | such time as both the Employee and the Employer agree in writing that it should cease to have effect; |
(ii) | on the date the Employer serves written notice on the Employee terminating its effect; |
(iii) | on the date HMRC withdraws approval of this Form of Election; or |
(iv) | on the date the Election ceases to have effect in accordance with its terms in respect of any outstanding Options granted under the Plan. |
1. | Termination on Account of Death. In the case of death, the Vest Date for this Award becomes your date of death and the Award remains exercisable until the Expiration Date. |
2. | Termination on Account of Retirement or Disability after June 30th of the fiscal year in which this Award was granted. In the case of Retirement or Disability, respectively, that occurs after June 30th of the fiscal year in which this Award was granted, the Award is not forfeited and will be exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan and the Regulations |
3. | Termination after June 30th of the fiscal year in which this Award was granted pursuant to a Written Separation Agreement. In the event of Termination of Employment that occurs after June 30th of the fiscal year in which this Award was granted, your Award is forfeited unless you have executed a written separation agreement with the Company or a Constituent Company that provides for retention of the Award. If the Award is retained pursuant to a separation agreement, the Award will become exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan, the Regulations and the separation agreement. |
4. | Termination in connection with a divestiture or separation of any of the Company’s businesses. In the event of Termination of Employment from the Company in connection with a divestiture or separation of any of the Company’s businesses, as determined by the Company’s Chief Human Resources Officer, the Award is retained and will become exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan and the Regulations. |
1. | Parties |
(A) | You, the individual who has obtained access to this Election (the “Employee”), who is eligible to receive stock options (the “Options”) granted by The Procter & Gamble Company of 1 Procter & Gamble Plaza, Cincinnati, OH 45202, U.S.A. pursuant to the terms and conditions of the Procter & Gamble 2014 Stock and Incentive Compensation Plan (the “Plan”), and |
(B) | The Procter & Gamble Company (“P&G” or the “Company”), which may grant Options and/or Restricted Stock Units under the Plan and is entering into this Election on behalf of the Employee’s Employer (“Employer”). |
2. | Purpose of Election |
2.1 | This Election relates to the Employer’s secondary Class 1 National Insurance Contributions (the “Employer’s Liability”) which may arise on the occurrence of a "Taxable Event" pursuant to section 4(4)(a) of the Social Security Contributions and Benefits Act 1992, including: |
(i) | the acquisition of securities pursuant to the Options (pursuant to section 477(3)(a) ITEPA); and/or |
(ii) | the assignment or release of the Options in return for consideration (pursuant to section 477(3)(b) ITEPA); and/or |
(iii) | the receipt of a benefit in connection with the Options other than a benefit within (i) or (ii) above (pursuant to section 477(3)(c) ITEPA); and/or |
(iv) | the acquisition of securities pursuant to Options granted under the Tax Advantaged sub-plan of the Plan in circumstances that do not attract relief from income tax. |
2.2 | This Election applies to all Options granted to the Employee under the Plan on or after January 1, 2015 up to the termination date of the Plan. |
2.3 | This Election does not apply in relation to any liability, or any part of any liability, arising as a result of regulations being given retrospective effect by virtue of section 4B(2) of either the Social Security Contributions and Benefits Act 1992, or the Social Security Contributions and Benefits (Northern Ireland) Act 1992. |
3. | The Election |
4. | Payment of the Employer’s Liability |
4.1 | The Employee hereby authorises the Employer and/or P&G to collect the Employer’s Liability from the Employee at any time after the Taxable Event: |
(i) | by deduction from salary or any other payment payable to the Employee at any time on or after the date of the Taxable Event; and/or |
(ii) | directly from the Employee by payment in cash or cleared funds; and/or |
(iii) | by arranging, on behalf of the Employee, for the sale of some of the securities which the Employee is entitled to receive in respect of the Options; and/or |
(iv) | through any other method as set forth in the award agreement entered into between the Employee and P&G. |
4.2 | The Employer hereby reserves for itself and P&G the right to withhold the transfer of any securities to the Employee until full payment of the Employer’s Liability is received. |
4.3 | The Employer agrees to remit the Employer’s Liability to Her Majesty’s Revenue and Customs (“HMRC”) on behalf of the Employee within 17 days after the end of the UK tax month during which the Taxable Event occurs. |
5. | Duration of Election |
5.1 | The Employee and the Employer agree to be bound by the terms of this Election regardless of whether the Employee is transferred abroad or is not employed by the Employer on the date on which the Employer’s Liability becomes due. |
5.2 | This Election will continue in effect until the earliest of the following: |
(i) | such time as both the Employee and the Employer agree in writing that it should cease to have effect; |
(ii) | on the date the Employer serves written notice on the Employee terminating its effect; |
(iii) | on the date HMRC withdraws approval of this Form of Election; or |
(iv) | on the date the Election ceases to have effect in accordance with its terms in respect of any outstanding Options granted under the Plan. |
1. | Termination on Account of Death. In the case of death, the Award is not forfeited and will become deliverable on the Settlement Date or Agreed Settlement Date, whichever is applicable. |
2. | Termination on Account of Retirement or Disability after June 30th of the fiscal year in which this Award was granted. In the case of Retirement or Disability, respectively, that occurs after June 30th of the fiscal year in which this award was granted, the Award is not forfeited and will become deliverable on the Settlement Date or Agreed Settlement Date, whichever is applicable, as long as you remain in compliance with the terms of the Plan and the Regulations. |
3. | Termination after June 30th of the fiscal year in which this award was granted pursuant to a Written Separation Agreement. In the event of your Termination of Employment from the Company or a Subsidiary that occurs after June 30th of the fiscal year in which this award was granted, this Award is forfeited unless you have executed a written separation agreement with the Company that provides for retention of the Award. If the Award is retained pursuant to a separation agreement, the Award will be delivered on the Settlement Date or Agreed Settlement Date, whichever is applicable, as long as you remain in compliance with the terms of the Plan, the Regulations, and the separation agreement. |
4. | Termination in connection with a divestiture or separation of any of the Company’s businesses. In the event of Termination of Employment from the Company in connection with a divestiture or separation of any of the Company’s businesses, as determined by the Company’s Chief Human Resources Officer, the Award is retained and will become deliverable on the Settlement Date or Agreed Settlement Date, whichever is applicable, as long as you remain in compliance with the terms of the Plan and the Regulations. |
1. | Termination on Account of Death. In the case of death, the Award will be fully vested and payment will be made by the later of the end of the calendar year or two and a half months following the date of death. |
2. | Termination on Account of Retirement or Disability after June 30 of the fiscal year in which this Award was granted. In the case of Retirement or Disability, respectively, that occurs after June 30th of the fiscal year in which this Award was granted, the Award is not forfeited and will become deliverable on the Settlement Date as long as you remain in compliance with the terms of the Plan and the Regulations. |
3. | Termination after June 30th of the fiscal year in which this award was granted pursuant to to a Written Separation Agreement. In the event of your Termination of Employment from the Company or a subsidiary that occurs after June 30th of the fiscal year in which this award was granted, your Award is forfeited unless you have executed a written separation agreement with the Company that provides for retention of the Award. If the Award is retained pursuant to a separation agreement, the Award will be delivered on the Settlement Date as long as you remain in compliance with the terms of the Plan, the Regulations, and the separation agreement. |
4. | Termination in connection with a divestiture or separation of any of the Company’s businesses. In the event of Termination of Employment from the Company in connection with a divestiture or separation of any of the Company’s businesses, as determined by the Company’s Chief Human Resources Officer, the Award is retained and will become deliverable on the Settlement Date as long as you remain in compliance with the terms of the Plan and the Regulations. |
1. | Termination on Account of Death or Disability. In the case of death or disability, the Award will be fully vested and payment will be made by the later of the end of the calendar year or two and a half months following the date of death or disability. |
2. | Termination without Cause Pursuant to a Written Separation Agreement. In the event of your Termination of Employment from the Company or a Subsidiary without Cause, your Award is forfeited unless the Chief Human Resources Officer authorizes the retention of the Award and you have executed a written separation agreement with the Company that provides for retention of the Award. If the Award is retained pursuant to CHRO authorization, the Award will be delivered on the Settlement Date(s) as long as you remain in compliance with the terms of the Plan, the Regulations, and your separation agreement. |
1. | Termination on Account of Death. In the event of death, the Vest Date for this Award becomes your date of death and the Award remains exercisable until the Expiration Date. |
2. | Termination on Account of Retirement or Disability after June 30th of the fiscal year in which this Award was granted. In the event of Retirement or Disability, respectively, that occurs after June 30th of the fiscal year in which this Award was granted, the Award is not forfeited and will be exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan and the Regulations. |
3. | Termination after June 30th of the fiscal year in which this Award was granted pursuant to a Written Separation Agreement. In the event of Termination of Employment from the Company or a Subsidiary that occurs after June 30th of the fiscal year in which this Award was granted, your Award is forfeited unless you have executed a written separation agreement with the Company or a Subsidiary that provides for retention of the Award. If the Award is retained pursuant to a separation agreement, the Award will become exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan, the Regulations and the separation agreement. |
4. | Termination in connection with a divestiture or separation of any of the Company’s businesses. In the event of Termination of Employment from the Company in connection with a divestiture or separation of any of the Company’s businesses, as determined by the Company’s Chief Human Resources Officer, the Award is retained and will become exercisable on the Vest Date in this Award Agreement and will expire on the Expiration Date as long as you remain in compliance with the terms of the Plan and the Regulations. |
_____% Cash* | } | |
_____% Stock Options | Must equal 100% | |
_____% Deferred Compensation1 |
_____% Stock Options* (0%, 25%, 50%, 75%, 100%) | } | Must equal 100% |
_____% Restricted Stock Units (RSUs) 3 (0%, 25%, 50%, 75%, 100%) |
_____% Common Shares* (delivered on [date]) | } | Must equal 100% |
_____% Restricted Stock Units (RSUs) 2 |
_____% Cash* | } | |
_____% Stock Options | Must equal 100% | |
_____% Deferred Compensation1 |
_____% Stock Options* (0%, 25%, 50%, 75%, 100%) | } | Must equal 100% |
_____% Restricted Stock Units (RSUs) 2 (0%, 25%, 50%, 75%, 100%) |
_____% Cash* | } | |
_____% Stock Options | Must equal 100% | |
_____% Deferred Compensation1 |
_____% Stock Options* (0%, 25%, 50%, 75%, 100%) | } | Must equal 100% |
_____% Restricted Stock Units (RSUs) 2 (0%, 25%, 50%, 75%, 100%) |
Years Ended June 30 | Six Months Ended December 31 | ||||||||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | 2014 | 2013 | |||||||||||||||||||||
EARNINGS, AS DEFINED | |||||||||||||||||||||||||||
Earnings from operations before income taxes after eliminating undistributed earnings of equity method investees | $ | 14,320 | $ | 14,270 | $ | 12,111 | $ | 14,305 | $ | 13,948 | $ | 7,507 | $ | 8,028 | |||||||||||||
Fixed charges (excluding capitalized interest) | 928 | 899 | 1,000 | 1,052 | 1,167 | 437 | 461 | ||||||||||||||||||||
TOTAL EARNINGS, AS DEFINED | $ | 15,248 | $ | 15,169 | $ | 13,111 | $ | 15,357 | $ | 15,115 | $ | 7,944 | $ | 8,489 | |||||||||||||
FIXED CHARGES, AS DEFINED | |||||||||||||||||||||||||||
Interest expense (including capitalized interest) | $ | 789 | $ | 754 | $ | 844 | $ | 888 | $ | 1,014 | $ | 365 | $ | 392 | |||||||||||||
1/3 of rental expense | 174 | 171 | 176 | 170 | 176 | 82 | 87 | ||||||||||||||||||||
TOTAL FIXED CHARGES, AS DEFINED | $ | 963 | $ | 925 | $ | 1,020 | $ | 1,058 | $ | 1,190 | $ | 447 | $ | 479 | |||||||||||||
RATIO OF EARNINGS TO FIXED CHARGES | 15.8x | 16.4x | 12.9x | 14.5x | 12.7x | 17.8x | 17.7x |
(1) | I have reviewed this quarterly report on Form 10-Q of The Procter & Gamble Company; |
(2) | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
(3) | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
(4) | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
(5) | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ A.G. LAFLEY |
(A.G. Lafley) |
Chairman of the Board, President and Chief Executive Officer |
January 27, 2015 |
Date |
(1) | I have reviewed this quarterly report on Form 10-Q of The Procter & Gamble Company; |
(2) | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
(3) | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
(4) | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
(5) | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ JON R. MOELLER |
(Jon R. Moeller) |
Chief Financial Officer |
January 27, 2015 |
Date |
(1) | The Quarterly Report on Form 10-Q of the Company for the quarterly period ended December 31, 2014 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in that Form 10-Q fairly presents, in all material respects, the financial conditions and results of operations of the Company. |
/s/ A.G. LAFLEY |
(A.G. Lafley) |
Chairman of the Board, President and Chief Executive Officer |
January 27, 2015 |
Date |
(1) | The Quarterly Report on Form 10-Q of the Company for the quarterly period ended December 31, 2014 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in that Form 10-Q fairly presents, in all material respects, the financial conditions and results of operations of the Company. |
/s/ JON R. MOELLER |
(Jon R. Moeller) |
Chief Financial Officer |
January 27, 2015 |
Date |
Restructuring Reserve by Type of Costs (Details) (USD $)
In Millions, unless otherwise specified |
3 Months Ended | 6 Months Ended | 36 Months Ended | |
---|---|---|---|---|
Dec. 31, 2014
|
Sep. 30, 2014
|
Dec. 31, 2014
|
Jun. 30, 2014
|
|
Restructuring Reserve [Roll Forward] | ||||
Restructuring Reserve | $ 381 | $ 381 | ||
Restructuring charges | 183 | 158 | 341 | 2,800 |
Cash Spent | (280) | |||
Charges Against Assets | (90) | |||
Restructuring Reserve | 352 | 352 | 381 | |
Separations | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring Reserve | 353 | 353 | ||
Restructuring charges | 98 | 81 | 1,500 | |
Cash Spent | (200) | |||
Charges Against Assets | ||||
Restructuring Reserve | 332 | 332 | 353 | |
Asset-Related Costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring Reserve | 0 | 0 | ||
Restructuring charges | 40 | 50 | 666 | |
Cash Spent | 0 | |||
Charges Against Assets | (90) | |||
Restructuring Reserve | 0 | 0 | 0 | |
Other Costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring Reserve | 28 | 28 | ||
Restructuring charges | 45 | 27 | 680 | |
Cash Spent | (80) | |||
Charges Against Assets | ||||
Restructuring Reserve | $ 20 | $ 20 | $ 28 |
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