UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended September 30, 2001 Commission file number 1-434
THE PROCTER & GAMBLE COMPANY
(Exact name of registrant as specified in its charter)
Ohio 31-0411980
(State of incorporation) (I.R.S. Employer Identification No.)
One Procter & Gamble Plaza, Cincinnati, Ohio 45202
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (513) 983-1100
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No .
There were 1,295,622,244 shares of Common Stock outstanding as of September 30,
2001.
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
The Consolidated Statements of Earnings of The Procter & Gamble Company and
subsidiaries for the three months ended September 30, 2001 and 2000, the
Condensed Consolidated Balance Sheets as of September 30, 2001 and June 30,
2001, and the Condensed Consolidated Statements of Cash Flows for the three
months ended September 30, 2001 and 2000 follow. In the opinion of management,
these unaudited consolidated financial statements contain all adjustments
necessary to present fairly the financial position, results of operations, and
cash flows for the interim periods reported. However, such financial statements
may not be necessarily indicative of annual results. Certain reclassifications
of prior year's amounts have been made to conform with the current year's
presentation.
THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
Amounts in Millions Except Per Share Amounts
Three Months Ended
September 30
-----------------------
2001 2000
------ ------
NET SALES $ 9,766 $ 9,969
Cost of products sold 5,111 5,307
Marketing, research, and
administrative expenses 2,893 2,883
------- -------
OPERATING INCOME 1,762 1,779
Interest expense 157 179
Other income, net 22 103
------ -------
EARNINGS BEFORE INCOME TAXES 1,627 1,703
Income taxes 523 548
------- -------
NET EARNINGS $ 1,104 $ 1,155
======= =======
PER COMMON SHARE:
Basic net earnings $ 0.83 $ 0.86
Diluted net earnings $ 0.79 $ 0.82
Dividends $ 0.38 $ 0.35
AVERAGE COMMON SHARES
OUTSTANDING - DILUTED 1,400.8 1,410.8
THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
Amounts in Millions
September 30 June 30
ASSETS 2001 2001
------ ------------ ----------
CURRENT ASSETS
Cash and cash equivalents $ 2,893 $ 2,306
Investment securities 211 212
Accounts receivable 3,054 2,931
Inventories
Materials and supplies 1,122 1,096
Work in process 412 373
Finished products 2,190 1,915
Deferred income taxes 310 397
Prepaid expenses and other current assets 1,776 1,659
-------- --------
TOTAL CURRENT ASSETS 11,968 10,889
PROPERTY, PLANT AND EQUIPMENT 23,003 22,821
ACCUMULATED DEPRECIATION (9,794) (9,726)
-------- --------
TOTAL PROPERTY, PLANT AND EQUIPMENT 13,209 13,095
GOODWILL AND OTHER INTANGIBLE ASSETS 8,379 8,300
OTHER NON-CURRENT ASSETS 2,055 2,103
-------- --------
TOTAL ASSETS $ 35,611 $ 34,387
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
CURRENT LIABILITIES
Accounts payable and accrued liabilities $ 7,952 $ 7,613
Debt due within one year 2,534 2,233
-------- --------
TOTAL CURRENT LIABILITIES 10,486 9,846
LONG-TERM DEBT 10,111 9,792
DEFERRED INCOME TAXES 642 894
OTHER NON-CURRENT LIABILITIES 1,935 1,845
-------- --------
TOTAL LIABILITIES 23,174 22,377
SHAREHOLDERS' EQUITY
Preferred stock 1,687 1,701
Common stock-shares outstanding -Sep 30 1,295.6 1,296
-Jun 30 1,295.7
1,296
Additional paid-in capital 2,136 2,057
Reserve for ESOP debt retirement (1,356) (1,375)
Accumulated comprehensive income (2,184) (2,120)
Retained earnings 10,858 10,451
-------- --------
TOTAL SHAREHOLDERS' EQUITY 12,437 12,010
-------- --------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 35,611 $ 34,387
======== ========
THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Three Months Ended
Amounts in Millions September 30
----------------------------
2001 2000
------------ ------------
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR $ 2,306 $ 1,415
OPERATING ACTIVITIES
Net earnings 1,104 1,155
Depreciation and amortization 382 503
Deferred income taxes 78 53
Change in:
Accounts receivable (96) (521)
Inventories (273) (182)
Accounts payable and accruals 269 234
Other operating assets & liabilities (342) (40)
Other 207 (121)
------- -------
TOTAL OPERATING ACTIVITIES 1,329 1,081
------- -------
INVESTING ACTIVITIES
Capital expenditures (352) (627)
Proceeds from asset sales 9 46
Acquisitions (74) (28)
Change in investment securities 55 24
------- -------
TOTAL INVESTING ACTIVITIES (362) (585)
------- -------
FINANCING ACTIVITIES
Dividends to shareholders (525) (488)
Change in short-term debt 619 (412)
Additions to long-term debt 0 1,351
Reduction of long-term debt (351) (153)
Proceeds from stock options 36 9
Purchase of treasury shares (168) (195)
------- -------
TOTAL FINANCING ACTIVITIES (389) 112
------- -------
EFFECT OF EXCHANGE RATE CHANGES ON CASH
AND CASH EQUIVALENTS 9 (22)
CHANGE IN CASH AND CASH EQUIVALENTS 587 586
------- -------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 2,893 $ 2,001
======= =======
THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Amounts in Millions
1. These statements should be read in conjunction with the Company's Annual
Report on Form 10-K for the fiscal year ended June 30, 2001. The results of
operations for the three-month period ended September 30, 2001 are not
indicative necessarily of the results for the full year.
2. Comprehensive Income - Total comprehensive income is comprised primarily of
net earnings, net currency translation gains and losses, net investment
hedges, net unrealized gains and losses on securities and cash flow hedges.
Total comprehensive income for the three months ended September 30, 2001
and 2000 was $1,040 and $1,044, respectively.
3. Segment Information - The basis for presenting segment results generally is
consistent with overall Company reporting. The primary difference relates
to partially-owned operations, which are presented as if owned 100% in the
operating segments. The adjustment to ownership basis is included in
corporate, which also includes certain financing and investment activities,
intangible asset amortization and prior year goodwill amortization, charges
related to the restructuring program, and other general corporate income
and expense items. Additionally, for interim periods certain non-recurring
tax impacts are reflected on a discrete basis for management and segment
reporting purposes, but are eliminated in corporate to arrive at the
Company's effective tax rate for the quarter.
Baby,
Three Months Fabric & Feminine & Beauty Health Food &
Ended September 30 Home Care Family Care Care Care Beverage Corporate Total
------------------ ----------- ------------- -------- -------- ---------- ----------- ---------
Net Sales
2001 $ 2,883 $ 2,997 $ 1,772 $ 1,176 $ 955 $ (17) $ 9,766
2000 3,075 3,039 1,865 990 1,053 (53) 9,969
Earnings Before Income Taxes
2001 665 549 458 210 154 (409) 1,627
2000 736 513 384 117 122 (169) 1,703
Net Earnings
2001 450 342 326 140 99 (253) 1,104
2000 498 329 267 81 75 (95) 1,155
4. Goodwill and Other Intangible Assets - In accordance with SFAS No. 142,
effective July 1, 2001, the Company discontinued the amortization of
goodwill and identifiable intangible assets that have indefinite useful
lives. Intangible assets that have finite useful lives will continue to be
amortized over their useful lives. Goodwill will be assessed annually for
impairment. The standard requires this impairment assessment to be
completed by December 31, 2001. As implementation guidance continues to
evolve, the assessment of goodwill impairment has not been finalized.
However, it is management's preliminary assessment that goodwill impairment
will not result.
The adjustment of previously reported net income and earnings per share
primarily represents previous amortization of goodwill. The impact on net
income, basic net earnings per share and diluted net earnings per share for
the quarter ended September 30, 2000 is $53 million, or $0.04 per share,
respectively. Adjusted net income, basic net earnings per share and diluted
net earnings per share for the three months ended September 30, 2000 is
$1,208 million, $0.90 per share and $0.86 per share, respectively.
Goodwill as of September 30, 2001, as allocated by reportable segment is as
follows:
Baby,
Fabric & Feminine & Food &
Home Care Family Care Beauty Care Health Care Beverage Total
--------- ----------- ----------- ----------- -------- ------
Goodwill $ 486 $ 2,808 $ 1,384 $ 2,567 $ 278 $ 7,523
There were no material changes in the carrying amount of goodwill during
the three months ended September 30, 2001.
Intangible assets as of September 30, 2001 comprise:
Gross Carrying Accumulated
Amount Amortization
------------------ ---------------
Amortizable intangible assets $ 869 $ 302
Non-amortizable intangible assets 458 169
------------------ ---------------
Total identifiable intangible assets 1,327 471
Amortizable intangible assets consist principally of patents, technology
and trademarks, and the non-amortizable intangible assets consist of
certain trademarks. The amortization of intangible assets for the three
months ended September 30, 2001 is $15 million.
Item 2. Management Discussion and Analysis
RESULTS OF OPERATIONS
---------------------
The Company reported earnings of $1.10 billion or $0.79 per share for the
quarter ended September 30, 2001. Results included a $238 million after-tax
restructuring charge related to the Company's restructuring initiative to
streamline its organization structure and business portfolio. Net earnings in
the year ago quarter were $1.16 billion, including a $85 million after-tax
restructuring charge.
Core net earnings were $1.34 billion for the quarter or $0.96 per diluted share.
Core results exclude restructuring charges in both periods and $53 million
after-tax or $0.04 per share of goodwill and intangible asset amortization in
the prior period. In the first quarter, the Company adopted the new accounting
rules for goodwill and other intangible assets, which prospectively eliminates a
significant portion of amortization expense beginning July 1, 2001.
Gross margin was 47.7 percent for the current quarter compared to 46.8 percent
in the same quarter of the prior year, and 43.7 percent for the full fiscal year
ended June 30, 2001. Included in cost of products sold is a $120 million
before-tax restructuring charge. Excluding restructuring, gross margin was 48.8
percent, up from 47.4 percent in the year ago quarter due to lower material
costs and other cost savings programs.
Operating margin was 18.0 percent for the current quarter compared to 17.8
percent in the same quarter a year ago and 12.1 for the prior fiscal year.
Excluding $310 million before tax in restructuring charges and the prior year
impact of goodwill amortization, operating margin was 21.3 percent, up from 19.5
percent in the year ago period. Operating margin progress was driven by gross
margin improvement, overhead cost reductions and marketing support efficiencies.
The following provides additional perspective on the Company's results by
business segment:
FABRIC AND HOME CARE
--------------------
Fabric and home care's focus on leadership brands and improved fundamentals is
beginning to show promising results in key markets. However, prior year
comparisons are difficult due to a very high base that included significant
customer buying in advance of a price increase in North America laundry. Unit
volume decreased two percent versus the prior year comparison, despite growth in
Western Europe and developing markets. Excluding two percent negative foreign
exchange and a one percent impact of divestitures in the prior year, net sales
of $2.88 billion were down three percent. Net earnings were down 10 percent to
$450 million versus year ago, primarily due to lower sales and minor brand
divestitures in the prior year.
BABY, FEMININE AND FAMILY CARE
------------------------------
The baby, feminine and family care segment generated earnings growth as the
business responds to improved consumer value propositions. Unit volume grew four
percent, driven by family care. Net sales of $3.00 billion were up two percent
excluding a three percent unfavorable exchange impact. Net earnings for the
quarter increased four percent to $342 million due to lower commodity costs and
other cost structure improvements. In baby care, net sales were up behind
strength in Baby Wipes and double-digit growth in Central and Eastern Europe,
the Middle East and Africa, and in China. In family care, sales were up strongly
as the North American business continues to respond to an improved value
equation.
BEAUTY CARE
-----------
Beauty care results demonstrate the benefit of portfolio shifts into higher
margin products behind leadership innovation. Unit volume was down slightly due
to Clearasil divestiture impacts; however, earnings growth was outstanding. Net
sales were $1.77 billion, comparable to the prior year after excluding a three
percent impact of unfavorable currencies and a two percent impact of
divestitures. Net earnings grew 22 percent to $326 million, primarily due to
marketing support efficiencies behind growing businesses and lower launch
expenditure, coupled with disciplined cost management. Additionally, the
majority of key markets achieved double-digit earnings progress, with Latin
America providing the strongest growth behind the successful restages of Pantene
and Head and Shoulders.
HEALTH CARE
-----------
Health care delivered double-digit growth behind the sustained development of
initiative programs on leading brands. Unit volume was up 19 percent driven by
excellent results in oral care, Iams pet health and nutrition, and
pharmaceuticals. Net sales grew 21 percent to $1.18 billion, excluding a two
percent unfavorable exchange impact. Net earnings increased 73 percent to $140
million, reflecting the benefit of high margin brands driving growth. In oral
care, Spinbrush is vying for value share leadership in the U.S. electric
toothbrush market, while Whitestrips achieved $100 million in net sales since
its launch in May 2001. Iams continues to grow behind initiatives and channel
expansion. Pharmaceuticals continued growth was driven by Actonel, which built
prescription share in the United States, Canada and key European markets.
FOOD AND BEVERAGE
-----------------
Food and beverage achieved solid earnings progress during the quarter. Excluding
divestitures, unit volume declined two percent. Net sales were $955 million,
down from the prior year level of $1.05 billion. The decrease is attributable to
divestitures, unfavorable foreign exchange impact and commodity-related pricing
actions in coffee. Importantly, net earnings grew to $99 million, a 32 percent
increase, behind heightened cost savings efforts in juice and coffee.
CORPORATE
---------
The corporate segment, which contains both operating and non-operating items is
not included in the business results. The change in net earnings for the
corporate segment was driven by increased restructuring charges due to the
expansion of the program announced last fiscal year.
FINANCIAL CONDITION
-------------------
Net debt (total debt less cash) increased $32.3 million since June 30, 2001, as
increases in debt, primarily to fund the Company's ongoing share repurchase
program, were partially offset by increases in operating cash flow.
For the three-month period ended September 30, 2001, cash generated from
operating activities totaled $1.3 billion, slightly up from $1.1 billion in the
same period in the prior year. The increase resulted primarily from improvements
in working capital.
RESTRUCTURING PROGRAM UPDATE
----------------------------
Beginning in 1999 - concurrent with the Company's reorganization into
product-based global business units - the Company initiated its Organization
2005 restructuring program. The program was expanded in March, 2001 to deliver
further cost reductions through reduced overhead, further manufacturing
consolidations, and discontinuation of under-performing businesses and
initiatives.
Costs to be incurred include separation related expenses, asset write-downs or
accelerated depreciation, results of certain initiatives being discontinued and
other costs directly related to the restructuring effort. These costs are
reported in the corporate segment for management and external reporting.
During the quarter ended September 30, 2001, the Company recorded charges
totaling $310 million before tax ($238 million after tax) related to
restructuring. The charges to cost of products sold amounted to $120 million
before tax and charges included in marketing, research and administrative
expenses amounted to $214 million before tax. Business results from certain
initiatives being discontinued included $24 million before tax of net sales
which are nearly offset by related costs in the current period restructuring
charges. Further details are shown in the following table:
Restructuring Program July-September, 2001 Charges (before tax)
---------------------------------------------------------------
Amounts in Millions
---------------------------- -------------- ------------- --------- ------------ ---------------
Beginning Current Charged Ending
Reserves Quarter Cash Against Reserves
at 6/30/01 Charges Spent Assets 9/30/01
---------- ------- ----- ------ -------
Employee separations $243 $212 $109 $-- $346
Asset write-downs -- 31 -- 31 --
Accelerated depreciation -- 32 -- 32 --
Other 217 35 112 6 134
-------------------------------------------------------------------
460 310 221 69 480
---------------------------- -------------- ------------- --------- ------------ ---------------
Employee separation charges of $212 million before tax in July - September, 2001
are associated with severance packages for approximately 3,000 people. The
packages are predominantly voluntary and are formula driven based on salary
levels and past service. Severance costs related to voluntary separations are
charged to earnings when the employee accepts the offer. The current and planned
separations span the entire organization, including manufacturing, selling,
research and administrative positions.
The charges for accelerated depreciation and asset write-downs, which totaled
$63 million before tax in the first quarter, are primarily related to
manufacturing operations. Charges for accelerated depreciation relate to
long-lived assets that will be taken out of service prior to the end of their
normal service period due to manufacturing consolidations, technology
standardization, plant closures or strategic choices to discontinue initiatives.
The Company has shortened the estimated useful lives of such assets, resulting
in incremental depreciation expense. Charges for asset write-downs relate to the
establishment of new fair value bases for assets held for sale or disposal that
represent excess capacity in the process of being removed from service or
disposed and businesses held for sale in the next 12 months.
Other costs incurred as a direct result of the restructuring program amounted to
$35 million before tax during the July - September, 2001 quarter. These were
primarily for relocation, training, establishment of global business services
and results from discontinued initiatives.
ACCOUNTING CHANGES
------------------
There are two additional areas for which additional discussion is provided:
accounting for goodwill and intangible amortization, and disclosure of
advertising expense.
Effective July 1, 2001, the Company adopted FASB Statement Nos. 141 and 142,
Business Combinations and Accounting for Goodwill and Other Intangible Assets.
FASB Statement No. 141 requires a fundamentally different approach to accounting
for business combinations, requiring that virtually all business combinations be
accounted for as acquisitions at fair value. The former pooling of interests
method has been eliminated. These rules will be applicable to all subsequent
acquisitions, including the planned acquisition of Clairol.
FASB Statement No. 142 eliminates the amortization of goodwill and certain
intangible assets. Rather, goodwill and intangibles not subject to amortization
will be tested for impairment at least annually by comparing their fair values
with their recorded amounts. The impact of adopting these new requirements is
discussed further in Footnote 4.
Annually the Company discloses advertising expense, which is a component of its
marketing, research and administrative expense. This amount reflects primarily
media and media-related costs. In the prior year disclosure a misclassification
occurred. For the years ended June 30, 2001, 2000 and 1999 the correct amounts
of advertising expense were: $3,612, $3,793, and $3,639, respectively. As a
percent of net sales, this would be 9.2%, 9.5% and 9.6% for 2001, 2000, and
1999. This reclassification only affects the advertising expense disclosure and
has no effect on total marketing, research and administrative expense, operating
income or net income.
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders:
At the Company's 2001 Annual Meeting of Shareholders held on October 9, 2001,
the following actions were taken:
The following Directors were elected for terms of office expiring in 2004:
Votes Broker
Votes For Withheld Abstentions* Non-Votes*
-------------------- --------------- ------------ -------------- -----------
JOSEPH T. GORMAN 1,120,806,910 11,521,435 N/A N/A
-------------------- --------------- ------------ -------------- -----------
LYNN M. MARTIN 1,119,823,354 12,014,544 N/A N/A
-------------------- --------------- ------------ -------------- -----------
JOHN E. PEPPER 1,121,640,458 11,584,500 N/A N/A
-------------------- --------------- ------------ -------------- -----------
RALPH SNYDERMAN 1,121,355,012 11,246,621 N/A N/A
-------------------- --------------- ------------ -------------- -----------
ROBERT D. STOREY 1,102,916,835 29,362,292 N/A N/A
* Pursuant to the terms of the Notice of Annual Meeting and Proxy Statements,
proxies received were voted, unless authority was withheld, in favor of the
election of the five nominees named.
In addition, the following directors continued in office after the meeting:
Norman R. Augustine, Donald R. Beall, Scott D. Cook, Domenico DeSole, Richard J.
Ferris, A.G. Lafley, Charles R. Lee, Johnathan A. Rodgers, John F. Smith, Jr.,
Marina v.N. Whitman, Ernesto Zedillo.
A proposal by the Board of Directors to ratify the appointment of Deloitte &
Touche LLP as the Company's independent auditors to conduct the annual audit of
the financial statements of the Company and its subsidiaries for the fiscal year
ending June 30, 2002, was approved by the shareholders. The shareholders cast
1,121,071,104 votes in favor of this proposal and 7,426,329 votes against. There
were 8,926,890 abstentions.
A proposal by the Board of Directors to approve The Procter & Gamble 2001 Stock
and Incentive Compensation Plan was approved by the shareholders. The
shareholders cast 652,924,171 votes in favor of this proposal and 269,207,277
votes against. There were 15,205,979 abstentions and 200,086,897 broker
non-votes.
A shareholder resolution proposed by Evelyn Y. Davis was defeated by the
shareholders. The proposal requested that the Board take the necessary steps to
provide for cumulative voting in the election of directors. The Board opposed
the resolution. The shareholders cast 246,135,100 votes in favor of the
resolution and 644,903,179 against. There were 46,300,588 abstentions and
200,085,457 broker non-votes.
A shareholder resolution proposed by Clarence A. Stone was defeated by the
shareholders. The proposal sought to reinstate the system of electing all
Directors annually, in place of the system of classifying Directors into three
classes with overlapping three-year terms which was approved by the shareholders
in 1985. The Board opposed the resolution. The shareholders cast 387,881,902
votes in favor of the resolution and 533,799,087 against. There were 15,669,819
abstentions and 200,073,516 broker non-votes.
A shareholder resolution proposed by Lenore Goldman and two co-sponsors was
defeated by the shareholders. The proposal requested that the Board of Directors
adopt a policy to identify and label all food products manufactured or sold by
the Company that may contain genetically engineered ingredients and report to
the shareholders by August, 2002. The Board opposed the resolution. The
shareholders cast 68,640,117 votes in favor of the resolution and 828,838,384
against. There were 40,172,598 abstentions and 199,773,225 broker non-votes.
A shareholder resolution proposed by The Sisters of the Holy Names of Jesus &
Mary and six co-sponsors was defeated by the shareholders. The proposal
requested that the Company report by the 2002 annual meeting on steps it will
take to use pulp and paper that has not been bleached with chlorinated
chemicals. The Board opposed the resolution. The shareholders cast 40,031,915
votes in favor of the resolution and 857,260,556 against. There were 40,290,286
abstentions and 199,841,567 broker non-votes.
A shareholder resolution proposed by Fred Baker was defeated by the
shareholders. The proposal recommended that the Board of Directors take the
necessary steps to eliminate any additional payments of cash, stock options, or
other means of extra compensation beyond the salary, accrued retirement, stock
options and incentives of the term presently being served for any officer of the
Company or Board member who may leave that position prior to the completion of
said term. The Board opposed the resolution. The shareholders cast 102,534,742
votes in favor of the resolution and 815,275,622 against. There were 19,732,306
abstentions and 199,881,654 broker non-votes.
A shareholder resolution proposed by the New York City Comptroller's Office, as
Custodian and Trustee of the New York City Police Pension Fund and five
co-sponsors, was defeated by the shareholders. The proposal requested that the
Board of Directors commit to amending the Company's buying policy and standard
purchase contracts to reflect full adoption of the principles defined by the
International Labor Organization; establish an independent monitoring process
that assesses adherence to these conventions; and report annually on adherence
to the amended policy through an independent and transparent process. The Board
opposed the resolution. The shareholders cast 68,058,931 votes in favor of the
resolution and 816,760,152 against. There were 52,522,349 abstentions and
200,082,892 broker non-votes.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
(3-1) Amended Articles of Incorporation (Incorporated by reference to
Exhibit (3-1) of the Company's Annual Report on Form 10-K for
the year ended June 30, 1998).
(3-2) Regulations (Incorporated by reference to Exhibit (3-2) of the
Company's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1998).
(11) Computation of Earnings per Share.
(12) Computation of Ratio of Earnings to Fixed Charges.
(b) Reports on Form 8-K
The Company filed Current Reports on Form 8-K containing information
pursuant to Item 5 ("Other Events") dated August 7, 2001, relating to
the announcement of earnings for the April-June 2001 quarter; dated
August 15, 2001, relating to a modification to the proposed transaction
with the Coca Cola Company; and dated September 5, 2001, relating to
confirmation of previously issued guidance for the July-September 2001
quarter.
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
THE PROCTER & GAMBLE COMPANY
/s/CLAYTON C. DALEY JR.
--------------------------------------
Clayton C. Daley Jr.
Chief Financial Officer and Comptroller
(Principal Accounting Officer)
Date: October 30, 2001
EXHIBIT INDEX
Exhibit No. Page No.
(3-1) Amended Articles of Incorporation (Incorporated by reference to
Exhibit (3-1) of the Company's Annual Report on Form 10-K for the
year ended June 30, 1998).
(3-2) Regulations (Incorporated by reference to Exhibit (3-2) of the
Company's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1998).
(11) Computation of Earnings per Share 15
(12) Computation of Ratio of Earnings to Fixed Charges 16