Procter & Gamble Company (The)

Procter & Gamble believes these measures provide investors with useful perspective on underlying business trends and has posted on its investor relations website, www.pginvestor.com, a full reconciliation of non-GAAP financial measures. Now I will turn the call over to P&G's Chief Financial Officer, Andre Scholten.

John Moeller here. I'm going to start the call and then I will hand it over to Andre. Good morning. Obviously, Andre is joining me here, as is John Chauvelier, Senior Vice President of Investor Relations. Last evening, we announced that after 38 years of service, I will transition into the role of Executive Chairman of the Board beginning January 1st, 2026. and that the Board of Directors has elected Shailesh Jujurikar as the incoming President and Chief Executive Officer. This move has been thoughtfully planned and provides P&G with highly capable and experienced leadership going forward. Shailesh has a distinguished track record throughout his 36-year P&G career and has been an integral part of P&G's leadership team for the past 12 years. He's delivered substantial contributions across multiple businesses in both focus and enterprise markets, including regional and global leadership of our fabric and home care categories. Most recently, Shailesh served as Chief Operating Officer with P&L ownership for our enterprise markets business, along with the management responsibilities for our product supply, market operations, global business services, and IT organizations. Over the last 17 years as CFO, COO and CEO, I've had the benefit of working closely with Shailesh and our outstanding global leadership team to develop an integrated comprehensive set of strategies to guide our choices and priorities. Those strategies continue to serve us well. Shailesh has been a partner in advocating for a focus on balanced top and bottom line growth and the need for P&G brands to lead the growth of our markets. growing markets versus simply taking business to build market share. These fundamentals guide our decision-making as we execute our integrated growth strategy and drive value creation for share owners. For my part, it's been a tremendous honor to serve as P&G's Chairman, President, and Chief Executive Officer. As I've walked the halls of P&G buildings around the world for the last 38 years, I'm constantly reminded of the privilege it is to work alongside such committed colleagues and friends. P&G has afforded me the chance to serve consumers and communities around the world. It's been a true joy and a tremendous learning experience. Our strategy is working. Our bench is strong. As we cross the calendar year, it's a good time to transition to the next generation to lead the P&G team through its next chapter of top and bottom line growth. And of course, value creation. With that, I'll now turn the call over to another esteemed colleague, Andre Schulten, to lead us through fiscal year 2025 at the fourth quarter and the year-end results.

Thank you, John, and congratulations to you and to Shailesh. And I'm very happy you will be in the current position for the next six months and executive chairman thereafter. So with that, I'll start with an overview of results for fiscal 25 and then the fourth quarter. John will add perspective on strategic focus areas and capabilities, and we will close with guidance for fiscal 26. And then take your questions. Execution of our integrated strategy enabled the company to grow organic sales and core EPS and to return cash to share owners in line with our target range in a challenging fiscal 25 despite volatile macroeconomic, geopolitical, and consumer dynamics, resulting in market-level headwinds that were not anticipated at the start of the fiscal year. Organic sales for the year grew 2 percent. Volume growth contributed one point, and price mix added one point. Growth continues to be broad-based across categories and regions. Nine of 10 product categories grew organic sales for the year. Family care and personal health care each grew with singles. fabric care, home care, feminine care, hair care, grooming, oral care, and skin and personal care were up low single digits. Baby care was down low singles. Focus markets grew organic sales 2% for the year, with North America up 2% and Europe focus markets up 3%. Greater China organic sales were down 5% versus the prior year, but improved sequentially throughout the fiscal year, growing 2% in the most recent quarter. Enterprise markets were up 2% led by Latin America with 4% organic sales growth. E-commerce sales increased 12%, now representing 19% of total company. 30 of our top 50 category country combinations held or grew share for the year. Seven of 10 product categories held or grew share globally. In aggregate, global value and volume share were both in line versus prior year. All channel market value in the U.S. categories in which we compete grew around 3.5% in fiscal 25. P&G consumption growth was largely in line with category value and volume levels for the year. For earnings per share were $6.83, up 4% for the year. Core growth margin declined 40 basis points, and core operating margin increased 50 basis points. Nearly $2.7 billion of productivity improvement across cost of goods sold and SG&A enabled an increase in investment in superior products, packages, and brand communication to drive market growth. On a currency neutral basis, core EPS was up 4%, and core operating margin increased 50 basis points. Adjusted free cash flow productivity was 87%. We increased our dividend by 5% and returned $16 billion of value to share owners, nearly $10 billion in dividends and $6.5 billion in share repurchase, consistent with our guidance at the start of the fiscal year. Moving to fourth quarter results, organic sales rounded up to 2%. Volume was in line with prior year. Pricing and mix were each up 1%. Growth continues to be broad-based across categories and regions, as 9 of 10 product categories held organic sales. Fabric care, home care, feminine care, family care, grooming, oral care, personal health care, and skin and personal care each grew low singles. Hair care was in line with prior year. and baby care was down low singles. Six or seven regions held or grew organic sales. Focus markets were up 1%. Organic sales in North America were in line with prior year. While we continue to see solid consumption growth in North America of around 2%, sell-in trailed sell-out due to retailer inventory reductions. European focus markets organic sales were up 2%. Greater China organic sales grew 2%. another quarter of sequential improvement and positive momentum heading into fiscal 26. The 6-18 key consumption period was relatively strong, but we are closely watching economic and consumer confidence impacts resulting from higher US tariffs on Chinese imports. Enterprise markets grew 3% for the quarter. Latin America organic sales were up 6%, including double-digit growth in Mexico, more than offsetting a modest sales decline in Brazil, due to trade inventory reductions. Europe enterprise and Asia Pacific Middle East Africa enterprise regions each grew organic sales low singles. Global aggregate market share was down 20 basis points. 28 of our top 50 category country combinations held our growth share for the quarter. On the bottom line, co-earnings per share were $1.48, up 6% versus prior year. and on a currency-neutral basis, core EPS increased 5%. These results include a $0.03 impact from tariffs. Core growth margin was down 70 basis points, and core operating margin increased 150 basis points. Very strong productivity improvement of 560 basis points, with healthy reinvestment in innovation and demand creation. Currency-neutral core operating margin increased 170 basis points. Adjusted pre-cash flow productivity was 110%, and we returned $3.3 billion of cash to share owners this quarter, $2.6 billion in dividends, and $700 million in share repurchase. In summary, another year of sales and earnings growth and strong cash return to share owners in a challenging economic and geopolitical environment. With that, I'll pass it back to John.