10-KPeriod: FY2013

PROCTER & GAMBLE Co Annual Report, Year Ended Jun 30, 2013

Filed August 8, 2013For Securities:PG

Summary

The Procter & Gamble Company (PG) 10-K filing for the fiscal year ended June 30, 2013, highlights a period of modest net sales growth driven by volume increases and price adjustments, alongside a significant boost in net earnings from continuing operations. This improvement in profitability was largely attributable to favorable acquisition/divestiture impacts and a reduction in impairment charges compared to the prior year. The company continues to focus on its core, profitable brands and markets, emphasizing innovation and productivity to drive future growth. Despite facing a competitive landscape and global economic uncertainties, P&G demonstrated strong free cash flow generation and maintained a robust dividend payout, underscoring its commitment to shareholder returns. Key financial metrics showed net sales reaching $84.2 billion, a 1% increase, with organic sales growing by 3%. Diluted earnings per share from continuing operations saw a substantial rise of 24% to $3.86, while reported diluted EPS increased by 5% to $3.86. The company successfully managed its costs, with gross margin expanding by 30 basis points. Significant divestitures, including the snacks business, were completed in the prior year, impacting year-over-year comparisons. P&G also initiated a productivity and cost savings plan, aiming for over $2 billion in annual savings over five years.

Financial Highlights

57 data points
Beta

Revenue

$80.12B

50.1% Gross Margin

Net Income

$11.31B

14.1% Net Margin

EPS (Diluted)

$3.86

Total Assets

$139.26B

Cash & Equivalents

$5.93B

Free Cash Flow

$10.87B

Financial Statements
Beta
Revenue$80.12B
Cost of Revenue$39.99B
Gross Profit$40.13B
R&D Expenses$1.90B
SG&A Expenses$26.00B
Operating Income$13.82B
Interest Expense$667.00M
Net Income$11.31B
EPS (Basic)$4.04
EPS (Diluted)$3.86
Shares Outstanding (Basic)2.74B
Shares Outstanding (Diluted)2.93B

Key Highlights

  • 1Net sales increased by 1% to $84.2 billion, with organic sales growth of 3%.
  • 2Diluted net earnings per share from continuing operations increased by 24% to $3.86.
  • 3Free cash flow generation was strong at $10.9 billion, with a productivity of 95%.
  • 4The company continued its commitment to shareholders by increasing its dividend for the 57th consecutive year.
  • 5A significant productivity and cost savings plan was in place, aiming for over $2 billion in annual savings.
  • 6Impairment charges were significantly lower than the prior year, contributing to the net earnings improvement.
  • 7The company's largest customer, Wal-Mart, accounted for 14% of net sales.

Frequently Asked Questions

In fiscal year 2013, Procter & Gamble reported net sales of $84.2 billion, a 1% increase from the prior year, with organic sales growing by 3%. Net earnings from continuing operations increased significantly by 22% to $11.4 billion, largely due to reduced impairment charges and favorable acquisition/divestiture impacts compared to fiscal year 2012. Diluted earnings per share from continuing operations rose 24% to $3.86.

P&G focused on managing costs through a productivity and cost savings plan designed to generate over $2 billion in annual savings. This focus, combined with higher pricing and manufacturing cost savings, led to a gross margin expansion of 30 basis points to 49.6% of net sales.

P&G's strategy involves focusing resources on its leading, most profitable categories and markets, both in core markets like the U.S. and in high-potential developing markets. Innovation in products and operations, along with improving operating discipline, are key pillars of its growth strategy.

P&G demonstrated a strong commitment to shareholder returns by increasing its quarterly dividend for the 57th consecutive year and repurchasing approximately $6.0 billion of its shares during fiscal year 2013. The company aims to deliver total shareholder returns in the top third of its peer group.