Jefferies Global Consumer Conference: June 22, 2010
Jefferies Global Consumer Conference: June 22, 2010
Global Consumer Conference
June 22, 2010 1
Purpose-inspired Growth
1
Fiscal 2011 – Innovation Impacts
3 Geographic expansion
4 New innovations
Fekkai Classic
Ariel & Dash Acti-lift- WE
Bounty Upgrade - NA
Always Simply Fits - UK
Naturella - China
Crest 3D White - NA
Fusion ProGlide - NA
Pantene Restage - NA
Dish Care
Fairy Auto Dish –
Western Europe
2
Dish Care
Dawn Hand Renewal –
North America
Dish Care
Joy Moist Care –
Japan
Dish Care
Gain Hand
Dishwashing Liquid
3
Air Care
Japan Febreze Mistral
10
Air Care
AmbiPur Acquisition
11
12
4
Fabric Care
Tide Naturals - India
13
Fabric Care
Ariel Actilift, Dash Actilift
14
Fabric Care
Tide Acti-Lift
15
5
Fabric Care
Powder Compaction and Formula Upgrade
16
Baby Care
Pampers Value Tier
17
Baby Care
Pampers DryMax – North America
18
6
Baby Care
Pampers Dry Max – Western Europe
19
Oral Care
Pro-Health Formula Expansion
Mexico China
20
Oral Care
Oral-B Toothpaste Expansion
Brazil Benelux
21
7
Oral Care
Premium Oral Care Boutique
Crest 3D White
22
Hair Care
Pantene Nature Fusion
23
Hair Care
Pantene Brand Restage
24
8
Blades and Razors
Mach 3 India
25
26
3 Geographic expansion
4 New innovations
27
9
Investing in Growth
Continued industry leading R&D investment
$1.5
$1.0
$0.5
Investing in Growth
Significantly more consumer impressions in FY’10;
Continued strong support levels in FY’11
~+20%
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30
10
Simplification and Productivity
SG&A
31
Cost Discipline
Enables Growth
Simplifying our
Frees up work, decision
investment for making and
growth structure
Consumer
Frees up capacity
for innovation
32
Business Objectives
33
11
Fiscal Year 2010
Organic Sales Growth
+5%
+4%
+4% to +3%
+5% to
+5%
+2%
Q4’09
Organic sales growth is sales growth excluding the impacts of acquisitions, divestitures and foreign exchange.
34
Business Outlook
FY 2010 Guidance Evolution
May ‘09 Oct. ‘09 Current
$3.62 to
Core EPS $3.68
Core EPS
C -1% to +3% 0% to +3% +4% to +6%
Growth
Organic Sales
+1% to +3% +2% to +4% +3% to +5%
Growth
Core earnings per share growth is a measure of diluted net earnings per share from continuing operations excluding charges for
pending European legal matters, the impact of recently enacted U.S. health care legislation and incremental restructuring
charges related to the Folgers divestiture in the prior fiscal year.
35
36
Cash Discipline
Adjusted Free Cash Flow Productivity*
99% 102%
$12 128%
Target = 90%+
101%
$10
ow, $Bn
100%
$8
Adjusted Free Cash Flo
146% 117%
92%
$6
$4
$2
$0
0
3
'1
'0
'0
'0
'0
'0
'0
'0
TD
FY
FY
FY
FY
FY
FY
FY
FY
* Ratio of adjusted free cash flow to net earnings excluding major divestiture gains. 36
12
Shareholder Value Creation
Cash Returned to Shareholders
*Adjusted free cash flow is operating cash flow less capital plus tax impacts from major divestitures.
^Value to shareholders includes dividends and share repurchases.
37
Business Outlook
Improving Global Market Share Trends
19.9%
“Basics”
Sales 3X to 4X
Growth
Category
AT +200 bps
Margin
Category
Value +1.5 point
Share
13
Feminine Care Russia
FY’09 vs. FY’06
Sales
Growth 2.5 times
AT
Margin
+900 bps
Value
Share +6 points
Sales
Growth 6 times
BT +900 bps
Margin
Value
Share +8 points
Investing in Growth
Pricing & Promotion Activity
Neutral
FY’09 to
+1% Positive
FY’10e FY’11e
42
14
Forward Looking Statement
All statements, other than statements of historical fact included in this release or presentation, are forward-looking statements, as
that term is defined in the Private Securities Litigation Reform Act of 1995. Such statements are based on financial data, market
assumptions and business plans available only as of the time the statements are made, which may become out of date or
incomplete. We assume no obligation to update any forward-looking statement as a result of new information, future events or
other factors. Forward-looking statements are inherently uncertain, and investors must recognize that events could differ
significantly from our expectations. In addition to the risks and uncertainties noted in this release or presentation, there are certain
factors that could cause actual results to differ materially from those anticipated by some of the statements made. These include:
(1) the ability to achieve business plans, including growing existing sales and volume profitably despite high levels of competitive
activity, especially with respect to the product categories and geographical markets (including developing markets) in which the
Company has chosen to focus; (2) the ability to successfully manage ongoing acquisition and divestiture activities to achieve the
cost and growth synergies in accordance with the stated goals of these transactions without impacting the delivery of base
business objectives; (3) the ability to successfully manage ongoing organizational changes designed to support our growth
strategies, while successfully identifying, developing and retaining key employees; (4) the ability to manage and maintain key
customer relationships; (5) the ability to maintain key manufacturing and supply sources (including sole supplier and plant
manufacturing sources); (6) the ability to successfully manage regulatory, tax and legal requirements and matters (including
product liability, patent, intellectual property, competition law matters, and tax policy), and to resolve pending matters within
current estimates; (7) the ability to successfully implement, achieve and sustain cost improvement plans in manufacturing and
overhead areas, including the Company's outsourcing projects; (8) the ability to successfully manage currency (including currency
issues in certain countries, such as Venezuela, China and India), debt, interest rate and commodity cost exposures and significant
credit or liquidity issues; (9) the ability to manage continued global political and/or economic uncertainty and disruptions,
especially in the Company's significant geographical markets, as well as any political and/or economic uncertainty and disruptions
due to a global or regional credit crisis or terrorist and other hostile activities; (10) the ability to successfully manage competitive
factors, including prices, promotional incentives and trade terms for products; (11) the ability to obtain patents and respond to
technological advances attained by competitors and patents granted to competitors; (12) the ability to successfully manage
increases in the prices of raw materials used to make the Company's products; (13) the ability to stay close to consumers in an
era of increased media fragmentation; (14) the ability to stay on the leading edge of innovation and maintain a positive reputation
on our brands; and (15) the ability to rely on and maintain key information technology systems. For additional information
concerning factors that could cause actual results to materially differ from those projected herein, please refer to our most recent
10-K, 10-Q and 8-K reports.
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Regulation G Disclosure
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