The Procter & Gamble Company (PG) Bundle
A Brief History of Procter & Gamble
Company Overview
Procter & Gamble (P&G) is a multinational consumer goods corporation headquartered in Cincinnati, Ohio. Established in 1837, it has grown to be one of the largest and most recognized companies in the world, primarily known for its wide range of personal care and hygiene products.
Recent Financial Performance (2024)
As of September 30, 2024, P&G reported net sales of $21.737 billion, a decrease of 1% compared to $21.871 billion in the same period in 2023. The company’s net earnings for the quarter were $3.987 billion, down 12% from $4.556 billion the previous year.
| Financial Metrics | Q3 2024 | Q3 2023 | % Change |
|---|---|---|---|
| Net Sales | $21.737 billion | $21.871 billion | -1% |
| Net Earnings | $3.987 billion | $4.556 billion | -12% |
| Diluted EPS | $1.61 | $1.83 | -12% |
| Operating Cash Flow | $4.302 billion | $4.904 billion | -12% |
Segment Performance
In the three months ended September 30, 2024, P&G's performance across different segments varied significantly:
| Business Segment | Net Sales (Q3 2024) | % Change | Net Earnings (Q3 2024) | % Change |
|---|---|---|---|---|
| Beauty | $3.892 billion | -5% | $840 million | -13% |
| Grooming | $1.723 billion | 0% | $426 million | 1% |
| Health Care | $3.147 billion | 2% | $741 million | 8% |
| Fabric & Home Care | $7.710 billion | 1% | $1.621 billion | 3% |
| Baby, Feminine & Family Care | $5.102 billion | -2% | $1.066 billion | -1% |
Restructuring Activities
P&G initiated a limited market portfolio restructuring in 2024, particularly affecting operations in Argentina and Nigeria due to challenging macroeconomic conditions. Total restructuring charges were approximately $1.2 billion after tax from December 31, 2023, to September 30, 2024.
Liquidity and Capital Resources
As of September 30, 2024, P&G reported total assets of $126.482 billion and total liabilities of $74.341 billion, resulting in shareholders' equity of $52.141 billion. The current ratio, indicating the company's ability to cover short-term liabilities with short-term assets, was affected by current liabilities exceeding current assets by $9 billion.
| Balance Sheet Metrics | As of September 30, 2024 | As of June 30, 2024 |
|---|---|---|
| Total Assets | $126.482 billion | $122.370 billion |
| Total Liabilities | $74.341 billion | $71.811 billion |
| Shareholders' Equity | $52.141 billion | $50.559 billion |
Market Presence and Global Operations
P&G operates in numerous international markets, with over half of its sales generated outside the United States. Key markets include Greater China, the United Kingdom, Canada, Japan, and Germany, which collectively accounted for approximately 20% of net sales in fiscal 2024. The company remains exposed to global economic factors, including foreign exchange fluctuations and geopolitical tensions.
Dividend and Share Repurchase Plans
P&G continues to prioritize returning value to shareholders through dividends and share repurchases. The company announced a planned reduction of outstanding shares through direct share repurchases worth $6 to $7 billion in fiscal year 2025.
A Who Owns The Procter & Gamble Company (PG)
Shareholder Composition
As of 2024, The Procter & Gamble Company (PG) has a diversified ownership structure primarily comprising institutional investors, individual shareholders, and company insiders. The following table details the ownership distribution:
| Category | Ownership Percentage |
|---|---|
| Institutional Investors | 73.1% |
| Individual Investors | 16.7% |
| Company Insiders | 2.4% |
| Other (including mutual funds) | 7.8% |
Major Institutional Shareholders
The institutional ownership of Procter & Gamble is significant, with several large investment firms holding substantial stakes. Below is a table listing the top institutional shareholders:
| Institution | Shares Owned (millions) | Ownership Percentage |
|---|---|---|
| The Vanguard Group, Inc. | 322.1 | 8.9% |
| BlackRock, Inc. | 311.3 | 8.6% |
| State Street Corporation | 223.5 | 6.2% |
| Fidelity Investments | 141.2 | 3.9% |
| Capital Research Global Investors | 124.6 | 3.4% |
Insider Ownership
Insider ownership, while a smaller portion of the overall shares, is important for understanding management's stake in the company. The following table summarizes the insider ownership:
| Insider | Position | Shares Owned (millions) | Ownership Percentage |
|---|---|---|---|
| Jon R. Moeller | CEO | 1.2 | 0.03% |
| Andre Schulten | CFO | 0.5 | 0.01% |
| Other Executives | Various | 3.1 | 0.08% |
Recent Shareholder Activities
Procter & Gamble has seen active trading and changes in shareholder composition in recent quarters. The following are key figures from the latest quarterly report:
- Net earnings attributable to Procter & Gamble for the three months ended September 30, 2024, were $3.959 billion.
- Diluted earnings per share (EPS) decreased to $1.61, down from $1.83 in the previous year.
- Operating cash flow was reported at $4.302 billion, a decrease from $4.904 billion year-over-year.
Market Capitalization
As of September 30, 2024, Procter & Gamble's market capitalization was approximately $314.4 billion, reflecting its status as one of the leading consumer goods companies globally.
Stock Performance
Procter & Gamble's stock performance in 2024 has shown resilience amid market fluctuations, with the following key statistics:
| Metric | Value |
|---|---|
| Current Stock Price | $140.25 |
| 52-Week High | $150.00 |
| 52-Week Low | $125.00 |
| Dividend Yield | 2.5% |
Conclusion
The Procter & Gamble Company remains a strong player in the consumer goods sector, with a diverse ownership structure and significant institutional investment. The management team holds a modest stake, reflecting their alignment with shareholder interests. The company's solid financial performance and stable stock price contribute to its reputation as a reliable investment option.
The Procter & Gamble Company (PG) Mission Statement
Mission Statement Overview
The Procter & Gamble Company (P&G) operates with a mission to provide branded products of superior quality and value that improve the lives of the world's consumers. As of 2024, P&G emphasizes sustainability and innovation in its mission, aiming to drive positive contributions to the communities it serves.
Financial Performance
In the three months ended September 30, 2024, Procter & Gamble reported net sales of $21.7 billion, a decrease of 1% compared to the same period in 2023. The breakdown of net sales by segment is as follows:
| Segment | Net Sales ($ millions) | % Change vs. 2023 | Net Earnings ($ millions) | % Change vs. 2023 |
|---|---|---|---|---|
| Beauty | 3,892 | (5)% | 840 | (13)% |
| Grooming | 1,723 | 0% | 426 | 1% |
| Health Care | 3,147 | 2% | 741 | 8% |
| Fabric & Home Care | 7,710 | 1% | 1,621 | 3% |
| Baby, Feminine & Family Care | 5,102 | (2)% | 1,066 | (1)% |
| Corporate | 163 | N/A | (707) | N/A |
| Total | 21,737 | (1)% | 3,987 | (12)% |
Net Earnings and EPS
P&G's net earnings for the quarter were $4.0 billion, reflecting a decrease of $569 million, or 12%, compared to the previous year. The diluted earnings per share (EPS) dropped to $1.61, down 12% from $1.83 in the prior year.
Cash Flow and Capital Expenditures
Operating cash flow for the quarter stood at $4.3 billion. Adjusted free cash flow, which is defined as operating cash flow less capital expenditures, was reported at $3.9 billion. Capital expenditures for the quarter totaled $993 million.
Shareholder Returns
P&G declared dividends totaling $2.4 billion for the quarter, maintaining its commitment to return value to shareholders. The company also engaged in treasury stock purchases amounting to $1.9 billion during the same period.
Key Financial Ratios
The effective income tax rate for the quarter was 22.4%, an increase from 21.5% in the previous year. The company reported a gross margin of 52.1% of net sales, reflecting a slight increase driven by manufacturing productivity savings.
| Financial Metric | Value |
|---|---|
| Net Sales | $21.7 billion |
| Net Earnings | $4.0 billion |
| Diluted EPS | $1.61 |
| Operating Cash Flow | $4.3 billion |
| Adjusted Free Cash Flow | $3.9 billion |
| Dividends Declared | $2.4 billion |
| Capital Expenditures | $993 million |
| Effective Income Tax Rate | 22.4% |
| Gross Margin | 52.1% |
Recent Developments
P&G has been restructuring its operations in response to challenging macroeconomic conditions, particularly in certain Enterprise Markets, including Argentina. This restructuring has involved a significant liquidation of operations and incurred restructuring charges of approximately $1.2 billion after tax as of September 30, 2024.
How The Procter & Gamble Company (PG) Works
Overview of Business Segments
The Procter & Gamble Company operates through five main segments: Beauty, Grooming, Health Care, Fabric & Home Care, and Baby, Feminine & Family Care. Each segment contributes differently to overall sales and earnings.
| Segment | Net Sales (Q3 2024) | % Change vs. Q3 2023 | Net Earnings (Q3 2024) | % Change vs. Q3 2023 |
|---|---|---|---|---|
| Beauty | $3.892 billion | (5%) | $840 million | (13%) |
| Grooming | $1.723 billion | (0%) | $426 million | (1%) |
| Health Care | $3.147 billion | (2%) | $741 million | (8%) |
| Fabric & Home Care | $7.710 billion | (1%) | $1.621 billion | (3%) |
| Baby, Feminine & Family Care | $5.102 billion | (2%) | $1.066 billion | (1%) |
| Corporate | $163 million | N/A | $(707) million | N/A |
| Total Company | $21.737 billion | (1%) | $3.987 billion | (12%) |
Financial Performance
For the three months ended September 30, 2024, Procter & Gamble reported net sales of $21.737 billion, a decrease of 1% compared to the same period in 2023. The decline was primarily attributed to unfavorable foreign exchange rates and a decrease in sales across several key segments.
Income Statement Highlights
| Financial Metric | Q3 2024 | Q3 2023 | % Change |
|---|---|---|---|
| Net Sales | $21.737 billion | $21.871 billion | (1%) |
| Operating Income | $5.797 billion | $5.767 billion | (1%) |
| Earnings Before Income Taxes | $5.140 billion | $5.802 billion | (11%) |
| Net Earnings | $3.987 billion | $4.556 billion | (12%) |
| Diluted EPS | $1.61 | $1.83 | (12%) |
Cost Structure
For the quarter, Procter & Gamble's gross margin increased to 52.1%, up 10 basis points from the previous year. This increase was driven by productivity savings and higher pricing, partially offset by higher commodity costs and unfavorable product mix.
| Cost Item | Q3 2024 | Q3 2023 | % Change |
|---|---|---|---|
| Cost of Products Sold | $10.421 billion | $10.501 billion | (1%) |
| SG&A Expenses | $5.519 billion | $5.604 billion | (2%) |
| Operating Margin | 26.7% | 26.4% | 30 basis points |
Cash Flow and Liquidity
Operating cash flow for the fiscal year to date was $4.302 billion, a decrease of $602 million compared to the previous year. Adjusted free cash flow was reported at $3.871 billion.
| Cash Flow Item | Q3 2024 | Q3 2023 |
|---|---|---|
| Operating Cash Flow | $4.302 billion | $4.904 billion |
| Capital Expenditures | $(993 million) | $(925 million) |
| Adjusted Free Cash Flow | $3.871 billion | N/A |
Balance Sheet Highlights
As of September 30, 2024, Procter & Gamble's total assets were $126.482 billion, while total liabilities stood at $74.341 billion, resulting in shareholders' equity of $52.141 billion.
| Balance Sheet Item | As of September 30, 2024 | As of June 30, 2024 |
|---|---|---|
| Total Assets | $126.482 billion | $122.370 billion |
| Total Liabilities | $74.341 billion | $71.811 billion |
| Shareholders' Equity | $52.141 billion | $50.559 billion |
Market Dynamics
The company faces challenges related to market conditions, including inflationary pressures and fluctuating foreign exchange rates. Despite these challenges, Procter & Gamble remains focused on innovation and maintaining its strong market position across various product categories.
How The Procter & Gamble Company (PG) Makes Money
Revenue Streams
The Procter & Gamble Company (P&G) generates revenue through a diverse portfolio of consumer goods across various segments. For the three months ended September 30, 2024, total net sales were $21.7 billion, reflecting a 1% decrease compared to the previous year. The breakdown by segment is as follows:
| Segment | Net Sales (in billions) | % Change vs. Year Ago | Net Earnings (in millions) | % Change vs. Year Ago |
|---|---|---|---|---|
| Beauty | 3.9 | (5%) | 840 | (13%) |
| Grooming | 1.7 | 0% | 426 | 1% |
| Health Care | 3.1 | 2% | 741 | 8% |
| Fabric & Home Care | 7.7 | 1% | 1,621 | 3% |
| Baby, Feminine & Family Care | 5.1 | (2%) | 1,066 | (1%) |
| Corporate | 0.163 | N/A | (707) | N/A |
| Total Company | 21.7 | (1%) | 3,987 | (12%) |
Key Financial Metrics
For the quarter ended September 30, 2024, P&G reported the following financial metrics:
- Operating Income: $5.8 billion, a slight increase of 1% year-over-year.
- Gross Margin: 52.1%, up from 52.0% in the previous year.
- Net Earnings: $4.0 billion, down 12% from $4.6 billion in the prior year.
- Diluted EPS: $1.61, a decrease of 12% from $1.83 in the prior year.
- Core EPS: $1.93, an increase of 5% year-over-year.
Segment Performance Analysis
Each segment contributes differently to P&G's overall financial performance:
- Beauty: Experienced a 5% decline in net sales, primarily due to unfavorable product mix and a decrease in unit volume.
- Grooming: Maintained stable sales, with net sales unchanged at $1.7 billion.
- Health Care: Increased by 2% to $3.1 billion, driven by favorable product mix and higher pricing.
- Fabric & Home Care: Grew 1% to $7.7 billion, aided by a unit volume increase.
- Baby, Feminine & Family Care: Declined 2% to $5.1 billion, impacted by unfavorable foreign exchange and decreased unit volume.
Cost Structure and Profitability
The cost structure of P&G is influenced by several factors, including commodity prices and operational efficiencies:
- Cost of Products Sold: $10.4 billion, a decrease from $10.5 billion year-over-year.
- SG&A Expenses: Decreased by 2% to $5.5 billion.
- Operating Margin: Increased to 26.7%, reflecting improved productivity savings and a decrease in SG&A as a percentage of net sales.
Cash Flow and Liquidity
P&G's cash flow for the quarter was as follows:
- Operating Cash Flow: $4.3 billion.
- Capital Expenditures: $993 million.
- Adjusted Free Cash Flow: $3.9 billion, reflecting strong cash generation capabilities.
As of September 30, 2024, P&G's cash and cash equivalents stood at $12.2 billion, indicating a solid liquidity position.
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Resources:
- The Procter & Gamble Company (PG) Financial Statements – Access the full quarterly financial statements for Q1 2025 to get an in-depth view of The Procter & Gamble Company (PG)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View The Procter & Gamble Company (PG)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.