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 No.)
|
One
Procter & Gamble Plaza,
Cincinnati,
Ohio
|
45202
|
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Three
Months Ended
|
|||||||
Amounts
in millions
|
September
30
|
||||||
2006
|
2005
|
||||||
NET
SALES
|
$
|
18,785
|
$
|
14,793
|
|||
Cost
of products sold
|
8,865
|
7,159
|
|||||
Selling,
general and
|
|||||||
administrative
expense
|
5,866
|
4,577
|
|||||
OPERATING
INCOME
|
4,054
|
3,057
|
|||||
Interest
expense
|
358
|
219
|
|||||
Other
non-operating income, net
|
180
|
74
|
|||||
EARNINGS
BEFORE INCOME TAXES
|
3,876
|
2,912
|
|||||
Income
taxes
|
1,178
|
883
|
|||||
NET
EARNINGS
|
$
|
2,698
|
$
|
2,029
|
|||
PER
COMMON SHARE:
|
|||||||
Basic
net earnings
|
$
|
0.84
|
$
|
0.82
|
|||
Diluted
net earnings
|
$
|
0.79
|
$
|
0.77
|
|||
Dividends
|
$
|
0.31
|
$
|
0.28
|
|||
DILUTED
WEIGHTED AVERAGE
|
|||||||
COMMON
SHARES OUTSTANDING
|
3,413.3
|
2,649.7
|
|||||
See
accompanying Notes to Consolidated Financial
Statements
|
September
30
|
June
30
|
||||||||||||
ASSETS
|
2006
|
2006
|
|||||||||||
CURRENT
ASSETS
|
|||||||||||||
Cash
and cash equivalents
|
$
|
6,718
|
$
|
6,693
|
|||||||||
Investment
securities
|
1,040
|
1,133
|
|||||||||||
Accounts
receivable
|
6,640
|
5,725
|
|||||||||||
Inventories
|
|||||||||||||
Materials
and supplies
|
1,603
|
1,537
|
|||||||||||
Work
in process
|
477
|
623
|
|||||||||||
Finished
goods
|
4,710
|
4,131
|
|||||||||||
Total
inventories
|
6,790
|
6,291
|
|||||||||||
Deferred
income taxes
|
1,565
|
1,611
|
|||||||||||
Prepaid
expenses and other current assets
|
2,752
|
2,876
|
|||||||||||
TOTAL
CURRENT ASSETS
|
25,506
|
24,329
|
|||||||||||
PROPERTY,
PLANT AND EQUIPMENT
|
|||||||||||||
Buildings
|
5,976
|
5,871
|
|||||||||||
Machinery
and equipment
|
25,652
|
25,140
|
|||||||||||
Land
|
846
|
870
|
|||||||||||
32,474 | 31,881 | ||||||||||||
Accumulated
depreciation
|
(13,736
|
)
|
(13,111
|
)
|
|||||||||
NET
PROPERTY, PLANT AND EQUIPMENT
|
18,738
|
18,770
|
|||||||||||
GOODWILL
AND OTHER INTANGIBLE ASSETS
|
|||||||||||||
Goodwill
|
55,708
|
55,306
|
|||||||||||
Trademarks
and other intangible assets, net
|
33,583
|
33,721
|
|||||||||||
NET
GOODWILL AND OTHER INTANGIBLE ASSETS
|
89,291
|
89,027
|
|||||||||||
OTHER
NON-CURRENT ASSETS
|
3,514
|
3,569
|
|||||||||||
TOTAL
ASSETS
|
$ |
137,049
|
$
|
135,695
|
|||||||||
LIABILITIES
AND SHAREHOLDERS' EQUITY
|
|||||||||||||
CURRENT
LIABILITIES
|
|||||||||||||
Accounts
payable
|
$
|
4,507
|
$
|
4,910
|
|||||||||
Accrued
and other liabilities
|
9,943
|
9,587
|
|||||||||||
Taxes
payable
|
4,154
|
3,360
|
|||||||||||
Debt
due within one year
|
1,986
|
2,128
|
|||||||||||
TOTAL
CURRENT LIABILITIES
|
20,590
|
19,985
|
|||||||||||
LONG-TERM
DEBT
|
35,727
|
35,976
|
|||||||||||
DEFERRED
INCOME TAXES
|
12,429
|
12,354
|
|||||||||||
OTHER
NON-CURRENT LIABILITIES
|
4,490
|
4,472
|
|||||||||||
TOTAL
LIABILITIES
|
73,236
|
72,787
|
|||||||||||
SHAREHOLDERS'
EQUITY
|
|||||||||||||
Preferred
stock
|
1,440
|
1,451
|
|||||||||||
Common
stock - shares issued -
|
Sept
30
|
3,981.4
|
3,981
|
||||||||||
June
30
|
3,975.8
|
3,976
|
|||||||||||
Additional
paid-in capital
|
58,285
|
57,856
|
|||||||||||
Reserve
for ESOP debt retirement
|
(1,295
|
)
|
(1,288
|
)
|
|||||||||
Accumulated
other comprehensive income
|
(553
|
)
|
(518
|
)
|
|||||||||
Treasury
stock
|
(35,329
|
)
|
(34,235
|
)
|
|||||||||
Retained
earnings
|
37,284
|
35,666
|
|||||||||||
TOTAL
SHAREHOLDERS' EQUITY
|
63,813
|
62,908
|
|||||||||||
TOTAL
LIABILITIES AND SHAREHOLDERS' EQUITY
|
$
|
137,049
|
$
|
135,695
|
|||||||||
See
accompanying Notes to Consolidated Financial Statements
|
Three
Months Ended
|
|||||||
Amounts
in millions
|
September
30
|
||||||
2006
|
2005
|
||||||
CASH
AND CASH EQUIVALENTS, BEGINNING OF PERIOD
|
$
|
6,693
|
$
|
6,389
|
|||
OPERATING
ACTIVITIES
|
|||||||
Net
earnings
|
2,698
|
2,029
|
|||||
Depreciation
and amortization
|
784
|
448
|
|||||
Share-based
compensation expense
|
158
|
95
|
|||||
Deferred
income taxes
|
156
|
284
|
|||||
Changes
in:
|
|||||||
Accounts
receivable
|
(909
|
)
|
(539
|
)
|
|||
Inventories
|
(506
|
)
|
(149
|
)
|
|||
Accounts
payable, accrued and other liabilities
|
474
|
(243
|
)
|
||||
Other
operating assets and liabilities
|
102
|
175
|
|||||
Other
|
(4
|
)
|
71
|
||||
TOTAL
OPERATING ACTIVITIES
|
2,953
|
2,171
|
|||||
INVESTING
ACTIVITIES
|
|||||||
Capital
expenditures
|
(570
|
)
|
(401
|
)
|
|||
Proceeds
from asset sales
|
101
|
26
|
|||||
Acquisitions
|
(72
|
)
|
(1,178
|
)
|
|||
Change
in investment securities
|
93
|
(17
|
)
|
||||
TOTAL
INVESTING ACTIVITIES
|
(448
|
)
|
(1,570
|
)
|
|||
FINANCING
ACTIVITIES
|
|||||||
Dividends
to shareholders
|
(1,023
|
)
|
(727
|
)
|
|||
Change
in short-term debt
|
(6
|
)
|
(1,230
|
)
|
|||
Additions
to long-term debt
|
7
|
8,612
|
|||||
Reductions
of long-term debt
|
(551
|
)
|
(1,858
|
)
|
|||
Impact
of stock options and other
|
418
|
142
|
|||||
Treasury
purchases
|
(1,355
|
)
|
(5,555
|
)
|
|||
TOTAL
FINANCING ACTIVITIES
|
(2,510
|
)
|
(616
|
)
|
|||
EFFECT
OF EXCHANGE RATE CHANGES ON CASH
|
|||||||
AND
CASH EQUIVALENTS
|
30
|
(64
|
)
|
||||
CHANGE
IN CASH AND CASH EQUIVALENTS
|
25
|
(79
|
)
|
||||
CASH
AND CASH EQUIVALENTS, END OF PERIOD
|
$
|
6,718
|
$
|
6,310
|
|||
See
accompanying Notes to Consolidated Financial Statements
|
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, 2006. The
results of
operations for the three-month period ended September 30,
2006 are not
necessarily indicative of annual
results.
|
2.
|
Comprehensive
Income - Total comprehensive income is composed primarily
of net earnings,
net currency translation gains and losses, impacts of net
investment and
cash flow hedges and net unrealized gains and losses on
securities. Total
comprehensive income for the three months ended September
30, 2006 and
2005 was $2,663 million and $2,110 million,
respectively.
|
3.
|
Segment
Information - Following is a summary of segment results.
As noted in Note
4, the Company acquired The Gillette Company on October
1, 2005.
Accordingly, results of the acquired Gillette businesses
are only included
in segment results for the three months ended September
30,
2006.
|
Amounts
in millions
|
|||||||||||||
|
Three
Months Ended September 30
|
||||||||||||
|
|
Net
Sales
|
Earnings
Before Income Taxes
|
Net
Earnings
|
|||||||||
|
|
||||||||||||
Beauty
|
2006
|
$
|
5,603
|
$
|
1,197
|
$
|
872
|
||||||
|
2005
|
5,042
|
1,081
|
783
|
|||||||||
|
|||||||||||||
Health
Care
|
2006
|
2,227
|
560
|
385
|
|||||||||
|
2005
|
1,686
|
460
|
312
|
|||||||||
Beauty
and Health
|
2006
|
7,830
|
1,757
|
1,257
|
|||||||||
|
2005
|
6,728
|
1,541
|
1,095
|
|||||||||
|
|||||||||||||
Fabric
Care & Home Care
|
2006
|
4,752
|
1,107
|
754
|
|||||||||
|
2005
|
4,350
|
993
|
662
|
|||||||||
|
|||||||||||||
Baby
Care and Family Care
|
2006
|
3,099
|
600
|
383
|
|||||||||
|
2005
|
2,946
|
507
|
320
|
|||||||||
|
|||||||||||||
Pet
Health, Snacks and Coffee
|
2006
|
1,063
|
144
|
87
|
|||||||||
|
2005
|
968
|
119
|
76
|
|||||||||
Household
Care
|
2006
|
8,914
|
1,851
|
1,224
|
|||||||||
|
2005
|
8,264
|
1,619
|
1,058
|
|||||||||
|
|||||||||||||
Blades
& Razors
|
2006
|
1,299
|
450
|
337
|
|||||||||
|
2005
|
-
|
-
|
-
|
|||||||||
|
|||||||||||||
Duracell
& Braun
|
2006
|
976
|
151
|
95
|
|||||||||
|
2005
|
-
|
-
|
-
|
|||||||||
Gillette
Business Unit
|
2006
|
2,275
|
601
|
432
|
|||||||||
|
2005
|
-
|
-
|
-
|
|||||||||
|
|||||||||||||
Corporate
|
2006
|
(234
|
)
|
(333
|
)
|
(215
|
)
|
||||||
|
2005
|
(199
|
)
|
(248
|
)
|
(124
|
)
|
||||||
Total
|
2006
|
$
|
18,785
|
$
|
3,876
|
$
|
2,698
|
||||||
|
2005
|
14,793
|
2,912
|
2,029
|
4.
|
We
completed our acquisition of The Gillette Company
on
October
1, 2005. Accordingly, the operating results of the Gillette
businesses are
reported in our financial statements beginning October
1, 2005. The
following table provides pro forma results of operations
for the three
months ended September 30, 2005, as if Gillette had been
acquired as of
the beginning of the fiscal year presented. The pro forma
results include
certain purchase accounting adjustments such as the changes
in
depreciation and amortization expense on acquired tangible
and intangible
assets. However, pro forma results do not include any anticipated
cost
savings or other effects of the planned integration of
Gillette.
Accordingly, such amounts are not necessarily indicative
of the results if
the acquisition had occurred on the dates indicated or
that may result in
the future.
|
Three
|
||||
Months
|
||||
Ended
|
||||
Sept
30
|
||||
Amounts
in millions
|
2005
|
|||
Net
Sales
|
$
|
17,576
|
||
Net
Earnings
|
2,211
|
|||
Diluted
Net Earnings per Common Share
|
$
|
0.61
|
Amounts
in millions
|
||||
Current
assets
|
$
|
5,681
|
||
Property,
plant and equipment
|
3,655
|
|||
Goodwill
|
35,298
|
|||
Intangible
assets
|
29,707
|
|||
Other
noncurrent assets
|
382
|
|||
Total
assets acquired
|
74,723
|
|||
Current
liabilities
|
5,346
|
|||
Noncurrent
liabilities
|
15,951
|
|||
Total
liabilities assumed
|
21,297
|
|||
Net
assets acquired
|
53,426
|
Dollar
amounts in millions
|
|
Weighted
average life
|
|||||
Intangible
Assets with Determinable Lives
|
|||||||
Brands
|
$
|
1,627
|
20
|
||||
Patents
and technology
|
2,716
|
17
|
|||||
Customer
relationships
|
1,436
|
27
|
|||||
Brands
with Indefinite Lives
|
23,928
|
Indefinite
|
|||||
Total
intangible assets
|
$
|
29,707
|
|||||
5.
|
Goodwill
and Other Intangible Assets - Goodwill as of September
30, 2006 is
allocated by reportable segment and global business unit
as follows
(amounts in millions):
|
Three
Months Ended September 30, 2006
|
|||||||
Beauty,
beginning of year
|
$
|
17,870
|
|||||
Acquisitions
and divestiture
|
58
|
||||||
Translation
and other
|
5
|
||||||
Goodwill,
September 30, 2006
|
17,933
|
||||||
Health
Care, beginning of year
|
6,090
|
||||||
Acquisitions
and divestiture
|
(1
|
)
|
|||||
Translation
and other
|
6
|
||||||
Goodwill,
September 30, 2006
|
6,095
|
||||||
Total
Beauty & Health Care, beginning of year
|
23,960
|
||||||
Acquisitions
and divestiture
|
57
|
||||||
Translation
and other
|
11
|
||||||
Goodwill,
September 30, 2006
|
24,028
|
||||||
Baby
Care and Family Care, beginning of year
|
1,563
|
||||||
Acquisitions
and divestiture
|
7
|
||||||
Translation
and other
|
8
|
||||||
Goodwill,
September 30, 2006
|
1,578
|
||||||
Fabric
Care and Home Care, beginning of year
|
1,850
|
||||||
Acquisitions
and divestiture
|
12
|
||||||
Translation
and other
|
6
|
||||||
Goodwill,
September 30, 2006
|
1,868
|
||||||
Pet
Health, Snacks and Coffee, beginning of year
|
2,396
|
||||||
Acquisitions
and divestiture
|
5
|
||||||
Translation
and other
|
-
|
||||||
Goodwill,
September 30, 2006
|
2,401
|
||||||
Total
Household Care, beginning of year
|
5,809
|
||||||
Acquisitions
and divestiture
|
24
|
||||||
Translation
and other
|
14
|
||||||
Goodwill,
September 30, 2006
|
5,847
|
||||||
Blades
and Razors, beginning of year
|
21,539
|
||||||
Acquisitions
and divestiture
|
200
|
||||||
Translation
and other
|
24
|
||||||
Goodwill,
September 30, 2006
|
21,763
|
||||||
Duracell
and Braun, beginning of year
|
3,998
|
||||||
Acquisitions
and divestiture
|
68
|
||||||
Translation
and other
|
4
|
||||||
Goodwill,
September 30, 2006
|
4,070
|
||||||
Total
Gillette Business Unit, beginning of year
|
25,537
|
||||||
Acquisitions
and divestiture
|
268
|
||||||
Translation
and other
|
28
|
||||||
Goodwill,
September 30, 2006
|
25,833
|
||||||
Goodwill,
Net, beginning of year
|
55,306
|
||||||
Acquisitions
and divestiture
|
349
|
||||||
Translation
and other
|
53
|
||||||
Goodwill,
September 30, 2006
|
$
|
55,708
|
Gross
Carrying Amount
|
Accumulated
Amortization
|
|||||
Amortizable
intangible assets with determinable lives
|
$
|
8,322
|
$
|
1,432
|
||
Intangible
assets with indefinite lives
|
26,693
|
-
|
||||
Total
identifiable intangible assets
|
$
|
35,015
|
$
|
1,432
|
6.
|
Pursuant
to SFAS 123(R) “Share-Based Payment”, companies must recognize the cost of
employee services received in exchange for awards of
equity instruments
based on the grant-date fair value of those awards (the
“fair-value-based”
method).
|
Three
Months Ended
September
30
|
||||||
2006
|
2005
|
|||||
Share-Based
Compensation
|
||||||
Stock
Options
|
$
|
130
|
$
|
73
|
||
Other
Share-Based Awards
|
28
|
22
|
||||
Total
Share-Based Compensation
|
$
|
158
|
$
|
95
|
7.
|
Postretirement
Benefits - The Company offers various postretirement
benefits to its
employees. Additional information about these benefits
can be found in
Note 9, Postretirement Benefits and Employee Stock
Ownership Plan, which
appears on pages 55-59 of the Annual Report to Shareholders
for the fiscal
year ended June 30, 2006, which can be found by reference
to Exhibit 13 of
the Company's Annual Report on Form 10-K for the fiscal
year ended June
30, 2006.
|
Pension
Benefits
|
Other
Retiree Benefits
|
||||||||||||
Three
Months Ended
|
Three
Months Ended
|
||||||||||||
September
30
|
September
30
|
||||||||||||
2006
|
2005
|
2006
|
2005
|
||||||||||
Service
Cost
|
$
|
66
|
$
|
47
|
$
|
20
|
$
|
24
|
|||||
Interest
Cost
|
118
|
61
|
51
|
39
|
|||||||||
Expected
Return on Plan Assets
|
(110
|
)
|
(47
|
)
|
(102
|
)
|
(90
|
)
|
|||||
Amortization
of Prior Service Cost and Prior Transition Amount
|
3
|
2
|
(5
|
)
|
(5
|
)
|
|||||||
Recognized
Net Actuarial Loss
|
11
|
19
|
1
|
1
|
|||||||||
Gross
Benefit Cost
|
88
|
82
|
(35
|
)
|
(31
|
)
|
|||||||
Dividends
on ESOP Preferred Stock
|
-
|
-
|
(21
|
)
|
(19
|
)
|
|||||||
Net
Periodic Benefit Cost (Credit)
|
$
|
88
|
$
|
82
|
$
|
(56
|
)
|
$
|
(50
|
)
|
8.
|
In
July 2006, the FASB issued FIN 48, “Accounting for
Uncertainty in Income Taxes.” FIN 48 addresses the accounting and
disclosure of uncertain tax positions. We will adopt
FIN 48 on July 1,
2007. We are evaluating the impact, if any, that FIN
48 will have on our
financial statements.
|
Item
2.
|
Management’s
Discussion and Analysis of Financial Condition and Results
of
Operations.
|
Net
Sales
|
Net
Earnings
|
|
Beauty
and Health
|
41%
|
43%
|
Beauty
|
29%
|
30%
|
Health
Care
|
12%
|
13%
|
Household
Care
|
47%
|
42%
|
Fabric
Care and Home Care
|
25%
|
26%
|
Baby
Care and Family Care
|
16%
|
13%
|
Pet
Health, Snacks and Coffee
|
6%
|
3%
|
Gillette
GBU
|
12%
|
15%
|
Blades
and Razors
|
7%
|
12%
|
Duracell
and Braun
|
5%
|
3%
|
Total
|
100%
|
100%
|
· |
Unit
volume increased 23 percent during the quarter. Organic
volume, which
excludes the impacts of acquisitions and divestitures,
was up five
percent. Growth was broad-based with every reportable segment
delivering
organic volume growth.
|
· |
Net
sales grew 27 percent to $18.79 billion, including the
addition of
Gillette. Organic sales, which exclude the impacts of acquisitions,
divestitures and foreign exchange, increased six
percent.
|
· |
Net
earnings increased 33 percent to $2.70 billion for the
quarter. Net
earnings increased behind the addition of Gillette, sales
growth on our
base business and profit margin
improvement.
|
· |
Diluted
net earnings per share were $0.79, an increase of three
percent versus the
comparable prior year period, including an estimated $0.05
- $0.06 of
dilution impact from the Gillette
acquisition.
|
· |
Operating
cash flow was $2.95 billion, an increase of 36 percent
versus the prior
year period. Free cash flow productivity was 88 percent,
ahead of the base
year level. Free cash flow productivity is defined as the
ratio of
operating cash flow less capital expenditures to net
earnings.
|
THE
PROCTER & GAMBLE COMPANY AND SUBSIDIARIES
(Amounts
in Millions Except Per Share Amounts)
Consolidated
Earnings Information
|
||||||||||
Three
Months Ended
September
30
|
||||||||||
2006
|
2005
|
%
CHG
|
||||||||
NET
SALES
|
$
|
18,785
|
$
|
14,793
|
27
|
%
|
||||
COST
OF PRODUCTS SOLD
|
8,865
|
7,159
|
24
|
%
|
||||||
GROSS
MARGIN
|
9,920
|
7,634
|
30
|
%
|
||||||
SELLING,
GENERAL & ADMINISTRATIVE EXPENSE
|
5,866
|
4,577
|
28
|
%
|
||||||
OPERATING
INCOME
|
4,054
|
3,057
|
33
|
%
|
||||||
TOTAL
INTEREST EXPENSE
|
358
|
219
|
||||||||
OTHER
NON-OPERATING INCOME, NET
|
180
|
74
|
||||||||
EARNINGS
BEFORE INCOME TAXES
|
3,876
|
2,912
|
33
|
%
|
||||||
INCOME
TAXES
|
1,178
|
883
|
||||||||
NET
EARNINGS
|
2,698
|
2,029
|
33
|
%
|
||||||
EFFECTIVE
TAX RATE
|
30.4
|
%
|
30.3
|
%
|
||||||
PER
COMMON SHARE:
|
||||||||||
BASIC
NET EARNINGS
|
$
|
0.84
|
$
|
0.82
|
2
|
%
|
||||
DILUTED
NET EARNINGS
|
$
|
0.79
|
$
|
0.77
|
3
|
%
|
||||
DIVIDENDS
|
$
|
0.31
|
$
|
0.28
|
||||||
AVERAGE
DILUTED SHARES OUTSTANDING
|
3,413.3
|
2,649.7
|
||||||||
COMPARISONS
AS A % OF NET SALES
|
Basis
Pt Chg
|
|||||||||
COST
OF PRODUCTS SOLD
|
47.2
|
%
|
48.4
|
%
|
(120
|
)
|
||||
GROSS
MARGIN
|
52.8
|
%
|
51.6
|
%
|
120
|
|||||
SELLING,
GENERAL & ADMINISTRATIVE EXPENSE
|
31.2
|
%
|
30.9
|
%
|
30
|
|||||
OPERATING
MARGIN
|
21.6
|
%
|
20.7
|
%
|
90
|
|||||
EARNINGS
BEFORE INCOME TAXES
|
20.6
|
%
|
19.7
|
%
|
90
|
|||||
NET
EARNINGS
|
14.4
|
%
|
13.7
|
%
|
70
|
Net
Sales Change Drivers vs. Year Ago (July-September Quarter
2006 vs.
2005)
|
|||||||
Volume
with Acquisitions & Divestitures
|
Volume
excluding Acquisitions & Divestitures
|
Foreign
Exchange
|
Price
|
Mix/Other
|
Net
Sales Growth
|
Net
Sales Growth ex-FX
|
|
Beauty
and Health
|
|||||||
Beauty
|
8%
|
5%
|
2%
|
1%
|
0%
|
11%
|
9%
|
Health
Care
|
28%
|
2%
|
1%
|
2%
|
1%
|
32%
|
31%
|
Household
Care
|
|||||||
Fabric
Care and Home Care
|
8%
|
7%
|
1%
|
1%
|
-1%
|
9%
|
8%
|
Baby
Care and Family Care
|
4%
|
4%
|
1%
|
1%
|
-1%
|
5%
|
4%
|
Pet
Health, Snacks and Coffee
|
5%
|
5%
|
1%
|
-1%
|
5%
|
10%
|
9%
|
Gillette
GBU
|
|||||||
Blades
and Razors
|
n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
Duracell
and Braun
|
n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
Total
Company
|
23%
|
5%
|
1%
|
1%
|
2%
|
27%
|
26%
|
Three
Months Ended September 30, 2006
|
|||||||||||||||||||
Net
Sales
|
%
Change
Versus
Year
Ago
|
Earnings
Before Income Taxes
|
%
Change
Versus
Year
Ago
|
Net
Earnings
|
%
Change
Versus
Year
Ago
|
||||||||||||||
BEAUTY
|
$
|
5,603
|
11
|
%
|
$
|
1,197
|
11
|
%
|
$
|
872
|
11
|
%
|
|||||||
HEALTH
CARE
|
2,227
|
32
|
%
|
560
|
22
|
%
|
385
|
23
|
%
|
||||||||||
BEAUTY
AND HEALTH
|
7,830
|
16
|
%
|
1,757
|
14
|
%
|
1,257
|
15
|
%
|
||||||||||
FABRIC
CARE AND HOME CARE
|
4,752
|
9
|
%
|
1,107
|
11
|
%
|
754
|
14
|
%
|
||||||||||
BABY
CARE AND FAMILY CARE
|
3,099
|
5
|
%
|
600
|
18
|
%
|
383
|
20
|
%
|
||||||||||
PET
HEALTH, SNACKS & COFFEE
|
1,063
|
10
|
%
|
144
|
21
|
%
|
87
|
14
|
%
|
||||||||||
HOUSEHOLD
CARE
|
8,914
|
8
|
%
|
1,851
|
14
|
%
|
1,224
|
16
|
%
|
||||||||||
BLADES
AND RAZORS
|
1,299
|
N/A
|
450
|
N/A
|
337
|
N/A
|
|||||||||||||
DURACELL
AND BRAUN
|
976
|
N/A
|
151
|
N/A
|
95
|
N/A
|
|||||||||||||
GILLETTE
GBU
|
2,275
|
N/A
|
601
|
N/A
|
432
|
N/A
|
|||||||||||||
TOTAL
BUSINESS SEGMENTS
|
19,019
|
27
|
%
|
4,209
|
33
|
%
|
2,913
|
35
|
%
|
||||||||||
CORPORATE
|
(234
|
)
|
N/A
|
(333
|
)
|
N/A
|
(215
|
)
|
N/A
|
||||||||||
TOTAL
COMPANY
|
18,785
|
27
|
%
|
3,876
|
33
|
%
|
2,698
|
33
|
%
|
Total
Company
|
Beauty
|
Health
Care
|
|
Total
Sales Growth
|
27%
|
11%
|
32%
|
Foreign
Exchange Impact
|
(1)%
|
(2)%
|
(1)%
|
Acquisition/Divestiture
Impact
|
(20)%
|
(4)%
|
(27)%
|
Organic
Sales Growth
|
6%
|
5%
|
4%
|
Operating
Cash
Flow
|
Capital
Spending
|
Free
Cash Flow
|
Net
Earnings
|
Free
Cash Flow Productivity
|
|
Jul
- Sept ’06
|
$2,953
|
$(570)
|
$2,383
|
$2,698
|
88%
|
Jul
- Sept ’05
|
$2,171
|
$(401)
|
$1,770
|
$2,029
|
87%
|
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)
|
|
7/1/06-7/31/06
|
9,412,395
|
$56.43
|
4,874,994
|
|
8/1/06-8/31/06
|
6,673,239
|
$59.50
|
0
|
|
9/1/06-9/30/06
|
10,365,593
|
$61.52
|
0
|
|
(1)
The number of shares purchased other than through a publicly
announced
repurchase plan were 21,576,233 for the quarter. This
includes 3,844,253 shares acquired by the Company under
various
compensation and benefit plans, including those purchased
by P&G's Profit Sharing Trust. The Company administers cashless
exercises through an independent, third party broker
and does not
repurchase stock in connection with cashless
exercise.
|
||||
(2)
Average price paid per share is calculated on a settlement
basis and
excludes commission.
|
||||
(3)
On
July 21, 2006, the Company completed its share buyback
plan previously
announced on January 28, 2005 in connection with
the Gillette acquisition. Total shares repurchased under
the plan amounted
to $20.1 billion which was consistent with our
stated estimate of about $20 billion. The Company expects
that any further
repurchase of shares will be made on a
discretionary basis as part of the Company's overall
cash management
strategy, which also includes capital expenditures, dividends,
debt service, and strategic
acquisitions.
|
Votes
For
|
Votes
Withheld
|
Abstentions*
|
Broker
Non-Votes*
|
|
Norman
R. Augustine
|
2,689,165,421
|
78,666,446
|
N/A
|
N/A
|
A.
G. Lafley
|
2,697,092,037
|
70,739,830
|
N/A
|
N/A
|
Johnathan
A. Rodgers
|
2,691,012,845
|
76,819,022
|
N/A
|
N/A
|
John
F. Smith, Jr.
|
2,684,007,489
|
83,824,378
|
N/A
|
N/A
|
Margaret
C. Whitman
|
2,694,097,190
|
73,734,677
|
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.
|
(3-1)
|
Amended
Articles of Incorporation (Incorporated by reference
to Exhibit (3-1) of
the Company’s Form 10-Q for the quarter ended September 30,
2005).
|
(3-2)
|
Regulations
(as amended by shareholders at the annual meeting on
October 10,
2006).
|
(10-1)
|
The
Procter & Gamble 2001 Stock and Incentive Compensation Plan (as
amended on October 10, 2006) which was adopted by shareholders
at the
annual meeting on October 9, 2001.*
|
(10-2)
|
Summary of the Company's Short Term Achievement Reward Program and Business Growth Program, and related correspondence and terms and conditions.* |
(10-3)
|
$24,000,000,000
Revolving Credit Agreement among Procter & Gamble International
S.a.r.l and a syndicate of banks led by Citigroup.
|
(10-4)
|
The
Gillette Company Executive Life Insurance Program.*
|
(10-5)
|
The
Gillette Company Personal Financial Planning Reimbursement
Program.*
|
(10-6)
|
The
Gillette Company Senior Executive Financial Planning
Program.*
|
(10-7)
|
The
Gillette Company Estate Preservation Plan.*
|
(10-8)
|
The
Gillette Company Deferred Compensation Plan.*
|
(10-9)
|
Form
of Commercial Paper Dealer Agreement in connection with
$10 billion
commercial paper program initiated by Procter & Gamble International
Funding S.C.A.
|
(10-10)
|
Form
of Issuing and Paying Agent Agreement in connection with
$10 billion
commercial paper program initiated by Procter & Gamble International
Funding S.C.A.
|
(11)
|
Computation
of Earnings per Share.
|
(12)
|
Computation
of Ratio of Earnings to Fixed Charges.
|
(31)
|
Rule
13a-14(a)/15d-14(a) Certifications.
|
(32)
|
Section
1350 Certifications.
|
(3-1)
|
Amended
Articles of Incorporation (Incorporated by reference
to Exhibit (3-1) of
the Company’s Form 10-Q for the quarter ended September 30,
2005).
|
(3-2)
|
Regulations
(as amended by shareholders at the annual meeting on
October 10,
2006).
|
(10-1)
|
The
Procter & Gamble 2001 Stock and Incentive Compensation Plan (as
amended on October 10, 2006) which was adopted by shareholders
at the
annual meeting on October 9, 2001.
|
(10-2)
|
Summary of the Company's Short Term Achievement Reward Program and Business Growth Program, and related correspondence and terms and conditions. |
(10-3)
|
$24,000,000,000
Revolving Credit Agreement among Procter & Gamble International
S.a.r.l and a syndicate of banks led by Citigroup.
|
(10-4)
|
The
Gillette Company Executive Life Insurance Program.
|
(10-5)
|
The
Gillette Company Personal Financial Planning Reimbursement
Program.
|
(10-6)
|
The
Gillette Company Senior Executive Financial Planning
Program.
|
(10-7)
|
The
Gillette Company Estate Preservation Plan.
|
(10-8)
|
The
Gillette Company Deferred Compensation Plan.
|
(10-9)
|
Form
of Commercial Paper Dealer Agreement in connection with
$10 billion
commercial paper program initiated by Procter & Gamble International
Funding S.C.A.
|
(10-10)
|
Form
of Issuing and Paying Agent Agreement in connection with
$10 billion
commercial paper program initiated by Procter & Gamble International
Funding S.C.A.
|
(11)
|
Computation
of Earnings per Share.
|
(12)
|
Computation
of Ratio of Earnings to Fixed Charges.
|
(31)
|
Rule
13a-14(a)/15d-14(a) Certifications.
|
(32)
|
Section
1350 Certifications.
|