P&G Is Designed to Grow, Lafley Tells Shareholders

Chairman of the board and chief executive officer, A.G. Lafley, updated Procter & Gamble shareholders at the annual meeting on Oct. 9. Mr. Lafley said, “P&G is a company designed to grow for the short, mid and long term—consistently, reliably and sustainably”

He reminded the audience that at the 2001 annual meeting he promise to keep the company focused on serving consumers. Since then, the company has recorded strong growth and achieved several objectives. For example:

• Annual sales have nearly doubled from $39 billion to $76 billion.

• The number of brands with more than a billion dollars in annual sales has more than doubled to a total of 23 brands.

• The number of brands with annual sales between $500 million and $1 billion has more than quadrupled to a total of 18 brands.

• The number of retail customers that do a billion dollars or more in annual sales with P&G has jumped from two to seven.

• The company has generated $43 billion in net earnings and $50 billion in free cash flow.

• P&G’s market capitalization increased to more than $200 billion, making P&G the seventh most valuable company in the U.S. and the 13th most valuable in the world.

In the recently concluded fiscal year, P&G increased net sales by 12% to more than $76 billion, while organic sales increased 5%—in the middle of the company’s long-term target range. Growth came from a broad mix of businesses, including fabric and home care, beauty, health, baby and family care. North America was strong with volume growth in mid-single digits.

Looking ahead, Mr. Lafley told the audience that P&G will reach one billion more consumers by the end of the decade. Beauty is expected to help spearhead that growth, as P&G stays focused on high-margin businesses.