01—Abstract
Summary
Summary of the 8-K filed September 27, 2002. Cited figures are marked; the original filing is the authoritative source.
On September 27, 2002, Procter & Gamble filed an 8-K under Regulation FD to disclose that it remains comfortable with its previously stated volume, sales, and earnings-per-share growth guidance for the September 2002 quarter (fiscal Q1 2003) and fiscal year 2003.
The release was issued ahead of CEO A.G. Lafley's... [correction: the release names CEO Clayt Daley] presentation at the October 2, 2002 Merrill Lynch Global Branded Consumer Products Conference, so the guidance reaffirmation was made public before the company's remarks to investors. For the September quarter, P&G expects double-digit total volume growth, high-single-digit volume growth excluding acquisitions and divestitures, high-single-digit sales growth excluding foreign exchange, and mid-teens growth in core earnings per share (excluding restructuring charges).
For fiscal 2003, management expects core EPS to grow at its long-term double-digit target and sales, excluding foreign exchange, to grow 4%a to 6%. Management attributed the momentum to roughly 18 months of portfolio and brand interventions, leading innovation, marketing, and competitive pricing, while acknowledging a tough global economic environment.
For investors, the filing is primarily a confirmation rather than a change in outlook: it reaffirms existing guidance and signals confidence heading into an investor conference. The filing contains no new financial statements, and the figures are forward-looking management expectations that carry risk, as the release's own forward-looking statements disclaimer indicates.
02—Key points
Key Highlights
- Reaffirmed guidance: P&G said it remains comfortable with previously stated volume, sales, and EPS growth guidance for the September 2002 quarter and fiscal year 2003.
- September 2002 quarter: total volume expected to grow double digits; volume excluding acquisitions and divestitures expected to grow high single digits.
- September 2002 quarter: sales excluding foreign exchange expected to grow high single digits; core EPS (excluding restructuring charges) expected to grow mid-teens.
- Fiscal 2003: core EPS expected to grow at the company's long-term double-digit growth target.
- Fiscal 2003: sales excluding foreign exchange expected to grow 4% to 6%.
- Management credited roughly 18 months of portfolio and brand interventions, innovation, marketing, and competitive pricing for building momentum.
- Disclosure was made via Regulation FD ahead of CEO Clayt Daley's October 2, 2002 presentation at the Merrill Lynch Global Branded Consumer Products Conference, with a public webcast.
03—Questions
Frequently Asked Questions
Why did P&G file this 8-K?
The company filed under Item 5 (Other Events) to comply with Regulation FD, which requires that material information disclosed to investors be made public broadly. The guidance reaffirmation was to be part of the CEO's upcoming conference presentation, so it was released publicly in advance.
Did P&G change its guidance?
No. The filing states that P&G is comfortable with its previously stated guidance. It reaffirms, rather than revises, the expected growth ranges for the September 2002 quarter and fiscal 2003.
What does 'core' earnings per share mean here?
Core EPS excludes restructuring program charges. The company expects core EPS in the September 2002 quarter to grow in the mid-teens percent range, so investors should compare core figures with core figures rather than with reported GAAP EPS.
What is the difference between total volume and volume excluding acquisitions and divestitures?
Total volume growth is expected to be double digits, but excluding the effects of acquisitions and divestitures, growth is expected to be high single digits. The gap indicates that recent acquisitions contributed to the total, so organic growth is the lower figure.
What are the key risks to these expectations?
The release notes a tough global economic environment and contains forward-looking statements that are subject to risks and uncertainties. Guidance is management's expectation rather than a guarantee, and results could differ materially if consumer demand, pricing, currency movements, or restructuring execution deviate from plans.
04—Continue