Jon Moeller - Chief Financial Officer AG Lafley - President and Chief Executive Officer John Chevalier - Director, Investor Relations.

Bill Schmitz - Deutsche Bank John Faucher - JPMorgan Lauren Lieberman - Barclays Capital Wendy Nicholson - Citi Research Dara Mohsenian - Morgan Stanley Olivia Tong - Bank of America Chris Ferrara - Wells Fargo Nik Modi - RBC Capital Markets Ali Dibadj - Bernstein Michael Steib - Credit Suisse Steve Powers - UBS.

Good morning, and welcome to Procter & Gamble’s Quarter End Conference Call. Today’s discussion will include a number of forward-looking statements. If you will refer to P&G’s most recent 10-K, 10-Q, and 8-K reports, you will see a discussion of factors that could cause the company’s actual results to differ materially from these projections.

As required by Regulation G, P&G needs to make you aware that during the call, the company will make a number of references to non-GAAP and other financial measures. Management believes these measures provide investors valuable information on the underlying growth trends of the business.

Organic refers to reported results, excluding the impacts of acquisitions and divestitures and foreign exchange, where applicable. Free cash flow represents operating cash flow less capital expenditures. Free cash flow productivity is the ratio of free cash flow to net earnings.

Any measure described as core refers to the equivalent GAAP measure, adjusted for certain items. P&G has posted on its website, www.pg.com, a full reconciliation of non-GAAP and other financial measures. Now, I will turn the call over to P&G’s Chief Financial Officer, Jon Moeller..

Good morning. I am joined this morning by AG Lafley and John Chevalier. We will start our discussion with a review of fiscal year and fourth quarter results, AG will then discuss our going forward strategy and plans to strengthen our results, and I will close with guidance for fiscal 2015.

One housekeeping item before we begin all the numbers we will be discussing today assume discontinued operations treatment for the pet care business, reflecting in our planned exit. Impacts of the move from operating results to discontinued operations were provided previously in an 8-K filing and are available online.

Now, on to results, we grew organic sales 3% in the fiscal year we just completed in line with median performance in our industry. We essentially held market share. Core earnings per share increased 5%. Organic sales and earnings per share results were both within our target ranges.

In fact, they were both within the pre-Venezuela devaluation ranges that we established going into the fiscal year despite more than a 25% reduction in market growth rates from 4 points a year ago to 2.5 points to 3 points currently and significant negative foreign exchange developments versus our going in plan.

Our productivity program, which we will talk more about later, was a significant enabler in delivering in this outcome. On a constant currency basis, core earnings per share grew double-digits despite market growth headwinds. All-in sales grew 1%. All-in earnings per share grew 4%.

We generated $10.1 billion of free cash flow with 86% free cash flow productivity. We increased the dividend 7%, the 58th consecutive year that the dividend has been increased. We have returned $12.9 billion in cash to shareholders, $6.9 billion in dividends, and $6 billion in share repurchase. About 110% of net earnings all-in.

We made significant progress on productivity, operating discipline and execution. We delivered $1.6 billion of cost of goods savings, well ahead of our target run rate of $1.2 billion and ahead of our going in estimate of $1.4 billion.

We improved manufacturing productivity by over 7%, reducing overall enrollment while adding new capacity and new sites. We opened the first new multi-category distribution center in the U.S. with five additional centers slated to come online by early next calendar year. We continued to accelerate overhead reduction.

In February 2012 we announced the targeted 10% reduction of non-manufacturing enrollment by June of 2016. As of July 1, 2014, we have reduced roles by 16% more than 50% ahead of the original objective two years earlier.

We have made good progress driving marketing effectiveness and efficiency through an optimized media mix with more digital, mobile, search and social presence, improved message clarity and greater savings in non-media spending.

While acknowledging the progress I just described across cost of goods sold overhead and marketing you maybe asking yourselves, where have all the savings gone. In the year we just completed most went to offset FX.

We have large leading positions in some of the markets where currencies have softened the most Japan, Venezuela and Ukraine and where our price controls are in place. Excluding foreign exchange core earning per share were up double digits.

Partly as a result of devaluation we are seeing significant wage inflation in developing markets as much as 30% per annum, which we also need to offset. We are continuing to make targeted investments in innovation, trial generation and in selling coverage to drive growth.

In addition to productivity, we made good progress this year in continuing to focus the portfolio. Just yesterday we closed the Americas pet care sales to Mars. Mars has also chosen to exercise their option to purchase the Asia business which accounts 10% of sales. We are working the European pet transaction with a different set of buyers.

We exited concierge health services business and MDVIP. We exited the bleach business and we divested several additional smaller brands Latin America Pert as an example.

Moving from the fiscal year to the fourth quarter organic sales grew 2% in a very challenging macro environment with decelerating levels of market growth in both developed and developing regions and intense competitive spending in several categories. Organic volume was in line with prior year levels, pricing added two points to sales growth.

All-in, sales were down one point including the two point headwind from foreign exchange and a modest negative impact from minor brand divestitures. Core earnings per share were $0.95, a 20% increase versus the prior year. Foreign exchange was a $0.04 headwind on the quarter. Excluding foreign exchange, core earnings per share grew 25%.

This includes the 5 point benefit from tax and a 4 point benefit from minor brand divestitures. Core operating margin improved 170 basis points driven by productivity savings. Core gross margin was down 50 basis points.

Cost savings were approximately 270 basis points were offset by product category and geographic mix, foreign exchange and higher commodity costs. Core SG&A costs as a percentage of sales improved by 220 basis points, driven by overhead savings of 110 basis points, marketing efficiencies of 30 basis points and other SG&A reductions.

As we previewed in the last call non-operating gains from minor brand and business divestitures added approximately $0.03 to core earnings per share on the quarter. The effective tax rate on core earnings was 19% bringing the fiscal year rate to 21%, consistent with the outlook we provided in the last call.

June quarter all-in GAAP earnings per share were $0.89, which include approximately $0.04 per share of non-core restructuring charges and $0.02 of charges from legal reserve adjustments. In summary, we have just completed a challenging and tough but on-target year.

We met our objectives, delivered double digit constant currency earnings growth, meaningfully advanced our productivity and portfolio focus agendas and built on our strong track record of cash return to shareholders. There is more work to do to deliver sustainable sales growth and reliable profit cash and value creation.

I will turn it over to AG to talk about strategies and plans to accomplish this..

Thanks Jon. So that we are crystal clear, as John reported we delivered our business and financial commitments in 2013-2014, but we could have and should have done better.

If just a couple of businesses that missed their going in operating plans had delivered, we would have achieved our internal leadership team goals of 4% sales growth, built modest market share, delivered 7% core EPS instead of 5% and 5% core operating profit growth instead of 2%.

Despite all the market realities Jon described, country volatility, market slowdowns, currency hurts, customer and competitor challenges, the point here is delivering a better year was solely in our influence and control.

So, while operating discipline and executional capability is getting better, a lot better around here, it must continue to improve to reach the levels of performance this company and our organization is capable of. We are increasing our focus on shoppers and consumers, they are the boss.

Everything begins with consumer understanding winning the zero first and second moments of truth and everything ends with winning the consumer value equation, consumer preference, purchase and loyalty. We are focused on creating and building consumer preferred brands and products that generate leading industry growth and value creation.

This is how we will generate top tier total shareholder return.

We need to continue to strengthen our brand positions, our product portfolio and pipeline and our selling effectiveness in the country’s channels and customers in a way that maximizes shopper trial and regular purchase, drives brand and category growth and delivers more reliable value creation for customers, partners for P&G and of course for shareowners.

Today, we are announcing an important strategic step forward that will significantly streamline and simplify the company’s business and brand portfolio. We will become a much more focused, much more streamlined company of 70 to 80 brands organized into about a dozen business units and the four focused industry sectors.

We will compete in categories that are structurally attractive and that play to P&G strength. Within these categories, we will focus on leading brands marketed in the right countries, channels and customers, where the size of the prize and the probability of winning are highest with product lines and SKUs that really matter to shoppers and customers.

Why this significant strategic where to play change in brand portfolio? These core 70 to 80 brands are consumer preferred and customer supported.

These brands are for the most part leaders in their industry category or segment, 23 with sales of $1 billion to $10 billion, another 14 with sales of $0.5 billion to $1 billion, and the remainder 30 to 40 with strong brand equities in sales of $100 million to $500 million.

These brands are all well positioned with consumers and customers and well-positioned competitively. These brands have strong equities in differentiated products and a track record of growth and value creation driven by product innovation and brand preference.

These brands are core strategic and have very real potential to grow and deliver meaningful value creation. Over the last three years, the 70 to 80 brand portfolio has accounted for 90% of company sales and over 95% of profit.

It has grown 1 point or 100 basis points faster than the total company and has earned more than 1 additional point of before tax margin. This new streamlined P&G should continue to grow faster and more sustainably and reliably create more value.

Importantly, this will be a much simpler, much less complex company of leading brands that’s easier to manage and operate. This simplicity will significantly focus investment and resource allocation and enable execution. We will harvest, partner, discontinue or divest the balance 90 to 100 brands.

In aggregate, sales of these brands, has been declining 3% per year over the past three years. Profits have been declining 16%. These brands make up less than half the average company margin. The strategic narrowing and refocusing of the brand portfolio will have a number of significant benefits mutually reinforcing.

70 to 80 brands will bring clarity, focus and prioritization and simplicity to a smaller more integrated better coordinated organization. The brand business units will be responsible for brand and product programs end-to-end down to the local country level.

Selling and market operations will be responsible for customer and channel strategies (Technical Difficulty). I will continue.

Selling and market operations will be responsible for customer and channel strategies for distribution, shelving, merchandising and pricing execution for winning at the first moment of truth at the retail customer and distributor level.

This focus on fewer core strategic brands will enable a strategic rationalization of product lines within brands and an even more significant pruning of unproductive SKUs.

As we rationalized business and brand portfolios, product lines and SKUs, P&G brands and products will be easier to shop and more productive and profitable for our customers, our partners and for the company.

This focus on fewer strategic brands will enable R&D to focus product and technology development on more consumer relevant and impactful brand and product ideas. We have already started reallocating R&D resources and budgets, cutting out low value activity and doubling down on our most promising product innovations.

This focus on fewer core strategic brands will importantly inform our supply chain transformation. We will now match manufacturing capacity to the brand portfolio and product lines. We will build distribution and mixing centers for only the brands and products we choose to sell.

This should enable industry leading responsiveness and service to customers at lower cost throughout the value chain. With this refocus on consumer and shopper preferred leading brands, we will be able to focus selling operations by retail, account, wholesaler and distributor, strategies, tactics and in-store executions that really make a difference.

The same simplification and prioritization enables all our functions to provide the business units and sales operations better value-added help and support. In summary, we are going to create a faster growing more profitable company that is far simpler to manage and operate.

This will enable P&G people to be more agile and responsive, more flexible and faster, less will be much more. As a result of the company’s strategic focus on its leading brands, we will both accelerate and over-deliver the original $10 billion productivity plan.

While we are not going to publish or report specific endpoint savings numbers today, we will clearly over-deliver the original goals and we will update you on progress along the way. In cost of goods sold, we are driving further and faster than when we established the original savings objectives.

The annual manufacturing productivity improvements we are making and have made measured by the number of cases of product produced per person per year are well beyond initial targets that our process reliability and adherence to quality standards is resulting in less raw material and finished product scrapping.

Increasing localization of supply chain is driving transportation and warehousing cost savings. Earlier this year, we initiated what is probably the biggest supply chain redesign in our company’s history. We are moving from primarily single category production sites to fewer multi-category manufacturing plants.

We are taking this opportunity to simplify, standardize and upgrade manufacturing platforms for faster innovation, qualification and expansion and improve product quality. We moved to standard manufacturing platforms a little over 10 years ago in baby care.

We are developing standardized manufacturing platforms for a number of businesses, fabric care, grooming, oral, and personal power to name a handful.

We are transforming our distribution center network moving from shipping products to customers from many ship points as if they were coming from different companies to consolidating customers shipping into fewer distribution centers.

These centers are located strategically closer to customers and key population centers in North America enabling 80% of P&G’s business to be within one day or less of the store shelf and the shopper.

This will allow both P&G and our retail partners to optimize inventory levels, while still improving service and on-shelf availability, efficient customer and consumer response and more importantly reducing in-store out of stocks. All of our new distribution centers will be up and running by early 2015.

To manage and operate the simpler brand portfolio, we have made several important organization design changes, move to four industry-based sectors, streamlined and de-duplicate – de-duplication of business units and selling operations, recombination of four brand building functions into one, reduction of hierarchy with all the sales operations and business unit leaders working together and working directly with Jon and with me.

Each of these changes reduces complexity. Each creates clear accountability for performance and results. We are just beginning to benefit from these opportunities to improve performance and reduce overhead costs that the organization changes create.

We believe we have more opportunity to improve marketing effectiveness and efficiency in both media or non-media areas, while increasing overall marketing effectiveness and improving top line growth.

When we get brand and product innovation right, source and sell brands and products effectively and efficiently we grow and we drive meaningful value creation. We generate higher sales and profit per unit which enables us to capture greater share of the value profit and cash where we choose to compete.

It is this share of value the share of profit and cash that is generated that we really want to focus on and if we can disproportionately capture. Today we have about 60 share of U.S.

laundry market sales that earn approximately 85% of the profit and cash generated in the entire category, nearly a 70 share of grooming business worldwide and about a 90 share of value or profit. This disproportionate capture of category value is direct result and reflection of our business strategy and our business models.

There has been some discussion in this context about whether premium price brands and products are still drivers of growth and value creation and I want to comment on this briefly this morning. We are shopper and consumer led. Their wants and needs come first.

We meet those needs with differentiated brands and better performing products priced to deliver real and perceived consumer value. In all four industry sectors and in most of our businesses there is as much and often more sales growth and value creation profit and cash in the premium and super premium segments.

We have had some success in these segments. In the grooming market premium products generate about 43% of category sales. Gillette has an 88 share of this segment. Four years ago we introduced Fusion ProGlide priced at the higher end of the premium segment.

Fusion grew global value share for 31 consecutive quarters reaching $1 billion in sales, faster than any other P&G brand or any other Gillette shaving systems in history. Fusion has been successful in developing markets which accounts for 25% of the brand’s and product line’s total business.

In countries where Fusion has been in the market for several years it has earned value shares that rival those is the best developed markets. South Korea we have a 45 share and Russia a 33 share for example.

Last month we launched the newest product in the Fusion lineup FlexBall is the first razor designed to respond to the contours of a man’s face maintaining maximum contact in delivering a close or more complete and more comfortable shave.

End market go side - premarket men preferred FlexBall two to one versus the then best selling razor in the world our own Fusion ProGlide. FlexBall is off to a very good start and appears to be revitalizing consumer interest in the category.

While it’s only been available a couple of months we have seen a 30% spike in male razor category value in the U.S. and acceleration in cartridge sales and shares. Crest 3D White premium oral care regimen was also launched in the U.S. and grew market share for 17 consecutive quarters, expanded worldwide and has become $1 billion business.

3D White has been an important driver of toothpaste market share growth in Brazil and Mexico adding about 0.5 of share in Brazil and a point in Mexico. We have recently launched 3D White in Spain, France and Australia. Early results are encouraging with growth in both category and our market share.

In Western Europe the oral care category grew 3.5% in value this last quarter in the region where many other categories are declining 1% to 2%. 3D White is a big driver of that category growth. Following up on the 3D White launch we introduced Crest 3D White Luxe toothpaste and White Strips.

The toothpaste removes up to 90% of surface stains on teeth in just five days and protects against future stains with a proprietary technology. The Whitestrips with FlexFit stretch and mold to your teeth for a custom fit.

Tide, Gain, and Ariel unit does laundry detergents have been an innovation breakthrough, resetting the bar for delightful consumer usage experience, product performance and convenience in the laundry detergent category. Tide Pods have priced at a 20% premium to base Liquid Tide and had grown to over 7% of the laundry category.

In March, we launched Gain Flings, their version of Pods, priced at a 60% per use premium to Gain liquid detergent. Flings have already grown to nearly 3% value share, combined Tide Pods and Gain Flings now hold a more than 10 value share of the U.S. laundry category and over 80% of the unit dose segment.

We now offer this innovative product in over 50 countries. And several other markets including Japan and China, we’ve recently launched single chamber unit does product setting the stage for future upgrades as the unit dose segment develops.

In Japan, Ariel and Bold unit dose detergents are off to a strong start achieving a nine value share in just three months. Managing a brand and product portfolio is obviously a balance. In some categories where affordable pricing is more important part of the consumer value equation.

We broaden our brand, product line, package size and price offerings to serve more consumer needs. Bounty and Bounty Basic, Charmin and Charmin Basic, Pampers and Luvs, Tide, Gain and now Tide simply clean and fresh.

While we will continue to compete with product innovation and brand differentiation, we will not allow ourselves to be uncompetitive on a consumer value basis and segments where we choose to play. There are times we must and will make appropriate pricing adjustments to remain competitive.

We’re doing this now, which you know on a targeted basis in U.S. Fabric Care and Family Care where competitors have been price discounting and promoting heavily since last calendar year. In the end, we follow the shopper and the consumer.

We meet their needs with consumer preferred P&G brands in better performing products, priced at a modest premium that delivers superior consumer value. We’re currently entering the female, adult incontinence category. This is an attractive $7 billion global category growing at an annual rate of 7%.

We’re entering the category with consumer preferred superior performing products that deliver significant benefit advantages from Always, a brand women trust in prefer. We began shipments of Always, discrete in U.K. last month and we’ll start shipments in North America and France over the next few weeks.

We’ll be sending you more details about this exciting new product line from Always next week. In September, we’re launching Crest Sensi-Stop strips. This is a revolutionary new product technology that provides the tooth sensitivity relief like never before.

One strip applied for just 10 minutes, delivers immediately and up to one month of protection from sensitivity, pain for many consumers. We’re setting the brand and product innovation agenda in our industry.

When we do this well, we build consumer preference for our brands, extend the level of product competitive advantage, build brand and product consumer preference accumulatively overtime, and capture a larger share of category value, profit and cash.

The final area that will benefit from brand portfolio simplification is the consistency and quality of our brand building and selling execution. This execution is the only strategy our consumers and customers ever really see. We’re bringing renewed focus to brands.

When we get brands right, we deeply understand consumers and we create desirable ideas, iconic equities, and become a prototype in the category. We consistently express the brand promise with ideas that attract consumers to the product superior benefits to create trial, purchase lasting preference, and loyalty.

This brand focus allows us to improve execution and build on those strategic brands to win ultimately with consumers. We’re also focusing selling resources to improve coverage, expertise, and execution in key retail channels, wholesalers, and distributors.

This should lead to improve distribution, shelving, merchandising and pricing execution to win consistently at the first moment of truth. We are and we will continue to increase coverage, sector and category dedication of our sales force and merchandisers in the store.

I am excited by the opportunity to further elevate brand and selling execution and feel very strongly these efforts will be enabled by the portfolio focus we have embarked on.

I am working directly the sector and SMO leaders on these opportunities to profitably accelerate top line growth, while Jon and the team continue leading the work on portfolio simplification and productivity.

This portfolio transformation may take a little more time than any of us would like because streamlining the brand and product portfolio will be governed by our ability to create value on every exit.

When we get there to our in effect P&G new-co with the streamlined 70 to 80 brand portfolio, this will enable faster and more sustainable growth and more reliable value creation through the end of the decade and beyond. We will be a simpler, faster growing, more profitable company that is far easier to manage and operate.

We will be a company of brands that consumers prefer and customers support, well positioned competitively. A company of brands simpler to source, sell and service.

The streamlined company of leadership household and personal care brands will deliver more reliable value creation for consumers and customers, partners and suppliers and will deliver reliably and sustainably total shareholder return in the top third of our industry peer group.

I look forward to updating you on our progress when we meet for our Analyst Meeting here in Cincinnati in November. Now I will turn the call back to Jon to provide the details on our outlook for this year..

We continue to expect global markets in our categories to grow in value terms 2% to 3%. Against this backdrop we are currently forecasting fiscal 2015 organic sales growth of low to mid-singles. With this level of growth, we will maintain or modestly grow global market share on a local currency basis.

We think this is pragmatic and realistic starting point for our fiscal ‘15 financial commitments. Pricing should again be a positive contributor to organic sales growth, though likely not to the same degree we have seen over the past several years. Foreign exchange is expected to be a one point sales growth headwind.

With this level of sales growth we are forecasting mid-single digit core earnings per share growth. We will benefit again from significant productivity savings, but like last year these will be partially offset by FX headwinds which won’t annualize at current spot rates until the back half of the year. We have a few value corrections to make.

We are also going to invest and consumer trial of preferred brands and major new product innovations that are in market and that are coming to market. We will continue to make investments in innovation and go to market coverage in the fastest growing sales channels. Non-operating income and tax should be roughly in line with prior year levels.

And we are targeting to deliver 90% or better free cash flow productivity. Our plans assume capital spending in the range of 4% to 5% of sales and share repurchase in the range of $5 billion to $7 billion. At this level, share repurchase should net of option exercises contribute about one percentage of earnings per share growth.

On an all-in GAAP basis we expect earnings per share to also grow mid-single digits including around $0.20 per share of non-core restructuring investments. In addition to the assumptions included in our guidance we want to continue to be very transparent about key items that are not included.

The guidance we are providing today is based on last week’s FX spot rates, further currency weakness including Venezuela is not anticipated within our guidance range. We continue to monitor unrest in several markets in the Middle East and Eastern Europe.

And we continue to closely monitor markets like Venezuela and Argentina where pricing controls and import restrictions present risk. This guidance does not assume any major portfolio moves. We will update guidance as these occur. Finally, our guidance assumes no further degradation of market growth rates.

There are a few things you should keep in mind as you construct your quarterly models, our toughest top line comps are in the first two quarters. The top and bottom line impacts from consumer value corrections will disproportionately affect the first quarter and the first half.

FX impacts will not fully annualize until the back half and productivity savings will build as the year progresses. In summary we are pleased to have delivered an on target year on both the top and bottom lines, but realized there is more work to do. We are realistic about where we stand in the journey and are excited about the path ahead.

That concludes our prepared remarks. As a reminder, business segment information is provided in our press release and will be available in slides, which will be posted in our website, www.pg.com following the call. AG and I will be happy now to take your questions..

Your first question comes from the line of Bill Schmitz with Deutsche Bank. Please proceed..

Hi, gentlemen. Good morning..

Good morning, Bill..

Good morning..

Hey, can you give us a timeline for the sales of those your 90 businesses that have been deemed non-core?.

Well, as AG said in his remarks, the timing on this is going to be governed by our ability to create value, which we are committed to do as we exit this business as much as we have done exactly as we have done with the prior category and brand exits.

And rough order of magnitude, this is I would guess, Bill, though I am not providing the specific guidance probably call it 12 to 24 months, but again, we are not going to be governed by timeline, we are going to be governed by value creation..

Your next question comes from the line of John Faucher (JPMorgan). Please proceed..

Yes, thank you.

Sort of continuing with this, one of the things you guys are working on is driving sort of more cost efficient structures and I guess how do you fragment some of these brand groups or is this I guess can you talk a little bit about how this is making the structure less complicated as you go to this many brand groups? And then secondly, as you look at some of the productivity efforts, can you talk a little bit about the focus on stranded overhead and do you feel like your recent productivity will allow you to eliminate some of the potential dilution from selling off some of these businesses? Thanks..

So, John, first of all as we look at the portfolio in the way that AG described, we are really looking at it through a strategic lens and we are wanting to play in categories with brands, leadership brands that play to our strengths.

We have talked before about the core capabilities that we believe we have as a company and very simply brands that leverage those capabilities have proven over time to sustainably create value. And those that don’t fully leverage those capabilities on average, we have struggled with.

And so part of this simplification if you will is just matching up our businesses with what we are good at and not having to struggle with some things that we are not as good at. So, that in itself is a big simplification.

You can imagine going from a company of call it 160 brands to a company of 70 or 80 brands is in itself incredibly simplifying, the number of innovation platforms that we need to focus on, the number of manufacturing platforms that we need to focus on, the number of products that we need to sell to each and every customer and distributor.

So, there is tremendous simplification that comes with this.

To your specific question of stranded overheads, it is our objective and expectation that we will use the productivity savings that are available both through simplification that comes from portfolio focus, but also the productivity savings that come through the organization structure changes that AG talked about to in effect offset the stranded overhead impact.

There will be some dilution as these businesses go out just as there have been with businesses that we have been divesting. But it will be on that order of magnitude and it will result primarily from the loss of operating earnings of those businesses. We will take care of the stranded overhead..

John, just a couple of additional points, I mean, this is the classic strategic choice. We want to be in the businesses we should be in, not the businesses we are in. Secondly, it is driven by shoppers and consumers in the market primarily.

We are focusing on the brand and business portfolio in the four industries that consumers actually buy and prefer, right, that customers really support and can support, where we have very strong brand equities, where our net promoter scores are higher, where our brand positioning is well-differentiated and where the product performance delivers.

So, it’s very straightforward. And the objective is growth. The objective is balanced, profitable sales growth and much more reliable value creation, much more reliable generation of cash, primarily by cash and profit. In terms of the organization side, it’s going to get a lot simpler. It’s already begun to get simpler.

A lot this is already underway, but we just have real clarity about what a regional selling operation does and what a business unit does. And they are now connected with far fewer handoffs and we will continue to improve that design to further reduce the handoffs.

And we are just going to be much more agile and much more adaptable in a much quicker inside, much simpler inside, so we can deal with all of the change and the pace outside. That’s really the objective here.

Look, we had our last global leadership council meeting last week, okay, I don’t know the number, Jon, what are there 30 to 40 people and go, okay we now have a lead team of about 10 of us.

And basically the region leaders, the sector BU leaders, Jon and myself 10 to 12 of us, we meet more often, we work on the business, we get things done on a weekly – by weekly and monthly basis. So, we are just going to be more adaptable. We are going to be more agile. We are going to be more responsive.

We are going to be able to make decisions a lot faster and turn the decisions into action in the market that really matters..

Your next question comes from the line of Lauren Lieberman with Barclays Capital. Please proceed..

Thanks. Good morning. Just two quick things. First was just around any kind of tax implications or risks from selling businesses at a very low cost basis? And then the second was how do you think you will be able to kind of ensure you don’t lose shelf space or facings as you divest or discontinue brands? Thanks..

On the tax question, Lauren, there will be some low business assets that will be part of the portfolio that’s going to be disposed. We have done a pretty good job historically about managing that through tax efficient structures. Those do take time, which is what we are talking about when we say that value creation will guide the pacing of the exits.

So, we will try to manage that as effectively as we can.

AG, you want to talk about?.

one, we are able to grow and continue to create value from our core established brands and businesses going into the decade. Two, we’re able to create, transform, or acquiring build at least one major new business. And three, we’re able to move successfully in the new space. Okay, whether that’s developing markets or new channels or whatever.

And I suspect in2021, when we look back at this decade we’re going to see the same pattern. We’ve done a lot of analysis that shows more does not drive growth and more certainly does not drive value creation, absolute last point and you will know this one as well our better than I.

When the team sort of got us into the beauty and personnel care business between 2000 and 2007, we tripled the sales from whatever was under 7 to 20 plus, we quadrupled a profit and we did it on half a dozen brand businesses.

Pantene and Head & Shoulders, Olay, and SK-II, and a trio of fragrance brands accounted for virtually all of that growth in value creation in an industry that’s notorious for activity and complexity. So I just believe very deeply that we’re picking our spots in these industries that played our strengths and our assets and we’re going forward..

Your next question comes from the line of Wendy Nicholson with Citi Research. Please proceed..

I had two questions. First, maybe for you AG, you said at the beginning that there were several businesses that missed plan during the course of the year.

And I’m curious whether that is – was predominately innovation at some short of expectations or misprice products or what the problems were and I think you said you feel more confident about your execution ability going forward.

But may be specifically why is that, is it different people in charge or do you have a better sense of adoptability if things are going wrong. So, that’s question number one.

And then number two, Jon, your comments really surprised me, you said that for next year you only play in to maintain or modestly grow market share, which strikes me as a very – I don’t know weak stands to enter the year, I mean, I would think with all the innovation and all your plan spending, you would have more confidence or more enthusiasm about your market share trends, thanks..

Let me take the second part of that question and then turn it over to AG. Look, we’re trying to establish very realistic external guidance that frankly is reflective of the macro environment that we’re in as reflective of what we’ve proven ourselves capable of delivering thus far.

We delivered 3% organic sales growth this year or forecasting low to mid singles next year. We delivered 5% core earnings per share growth this year or forecasting mid singles for next year. We share completely your desire to do better than that and as we proved that capability if and as we prove that capability guidance will reflect that..

Wendy, on your first question, first to be very clear about what I said, it’s just a couple – two businesses had delivered their operating plans. We would have achieved our internal goals of 4, 7, 5 operating, okay and generated of course even more cash, just two, okay.

The issues were different in one business frankly, they let their pricing get out of line and the thing that was frustrating about it is, it was out of line and for whatever reasons, I don’t feel like the team came to grips with that reality fast enough, okay? It’s being fixed.

It happened before in this category, we know how to fix it will get fixed. And ironically it was a business that had like a 10 or 12, your run of very strong balanced growth and value creation. In the other case, we got our nose ahead of the tips of our skis on an investment in a new line of brands and products.

And we just need to get back to the discipline, okay, of testing and qualifying major investments that we are going to make. Hey, there is a lot of risk in the product innovation side.

There is a lot of risk when you are making investments in the marketplace, but we try to and we have a track record of and when we are performing to our capability, we do a reasonably good job of testing things before we expand them. And we just got the investment way ahead of the actual results in the marketplace. Those are the two.

The things I feel good about I should say is and my teams knows this is I actually feel very good that more of our businesses are executing better are sharpening their strategies and translating it into operating plans, and that our execution is improving.

But hey, this is an intensely executional industry and we just absolutely we have to be at the top of our game all the time..

And just one more point on this. While we did have problems in a couple of businesses as AG described, we had many businesses that had the best year they have had in a long time..

That’s right..

So for instance our Duracell business had a fantastic year. Our salon professional business had one of its best years in quite a long period of time. So there are many more things working than not working..

Your next question comes from the line Dara Mohsenian with Morgan Stanley. Please proceed..

Good morning. So A.G. on the portfolio rationalization, can you discuss why you are implementing it now, the strategy makes sense, but what’s kind of change is driving you to undertake this now.

You previously outlined that 90% of the business was core and you expected divestitures, I am assuming the brand rationalization announcement today includes those businesses you already expected to divest or should we look at this as rationalization on top of that.

And then last just given the process will take one to two years, are you committed to staying on board as CEO for as long as at least the bulk of the brand rationalization process takes?.

Okay. Dara, stop me if I don’t – if I don’t capture all of your questions. Okay, last question first, the Board, I am serving at the pleasure of the Board and we are criteria driven, we are not schedule driven, okay.

So obviously, I wanted to drive this strategy and accelerate it but that’s totally driven by our understanding of shopper and consumer needs and wants and the realities, okay, of the marketplace whether we are talking about channels and customers whether we are talking about competitive factors or whatever.

So this is purely consumer market and competitive driven strategic choice. Second thing is we are already underway, okay. So this is a continuation in acceleration. I mean we are underway on the portfolio pruning I just want to accelerate it, okay. We are underway on the organization redesign, I just want to accelerate it.

We are underway on the major restructuring and productivity savings that were announced 2 to 2.5 years ago. I just want to get it to a logical end point for the first phase, so that we can focus on operating with excellence and growing this business and performing at our peak. And I am sorry the third part of the question was Dara remind me..

Just why now specifically, I mean it makes sense but what drove you to make the change at this point?.

Okay. Look, in an ideal world, okay, in an ideal world we would have done this at the depth of the financial crisis and recession. That would have been the perfect time to do with, if you think about it, right, dramatically focus, dramatically simplify.

Get the cash flowing right and then once the bank is full, bide your time until the market starts to come again, right that would have been perfect, right. If we work Monday morning quarterbacks I could look over the last 40 years that would have been the perfect time. But I missed. We missed some of that opportunity.

And frankly when you are in the middle of a financial crisis when you are watching oil approach $150 a barrel and chaos is reining around you in the biggest recession since the 30s you always – you don’t always have the time to think through or the resources to act on a transformation of this seismic scope.

But having said that, I don’t see any reason to wait, I don’t see any virtue in waiting another minute. And I guess the last thing I would say is just think about what we are going to undertake.

I don’t want to go out and spend $1 billion round numbers on totally redoing the sourcing and supply chain in North America and do it for the wrong business shape and size that would be a terrible mistake, right.

So in a lot of other places we are making investments that are going to make this company stronger, help us operate better etcetera, etcetera. And we have to make sure that we are doing this for the business that we think we are going to have and we think we are going to run for at least the next five plus years or so..

Your next question comes from the line of Olivia Tong with Bank of America. Please proceed..

Can you talk about what other strategies you considered, why is this the right strategy and why doesn’t this at least in the interim take some focus away from fixing issues in the 70 to 80 brands that you are planning on keeping?.

I don’t see any trade off there Olivia. In other words, we will have more talent, more resource in our financial and people against the 70 to 80 brands. So I mean we are – we have been all over several of those businesses. And frankly I am involved with 10 to 15 of them working with the leadership team. So I don’t see any trade off.

Now I won’t tell you that there – that we haven’t taken on extra work for another year – year and a half maybe at most for parts of it. As Jon said maybe the last disposals are as far as 18 to 24 months away.

But now job one is to take care of shoppers and consumers, work with our customers and suppliers and deliver the operating plans and commitment on the 70 to 80 core brands that make up the portfolio that’s going to drive this company ahead..

Your next question comes from the line of Chris Ferrara with Wells Fargo. Please proceed..

Thanks. AG you highlighted P&G following the consumer as it relates to innovation at the premium side of categories and at higher price categories and I think you called out the success of innovation in high end laundry as an example.

Now I understand like you don’t report laundry standalone, but fabric and home was up 1% organically, the Nielsen data in the U.S.

shows share erosion even following the launch activity obviously there was a lot of competition there with lot of deep discounting, you responded that your own deep discounting, I guess is this an anomaly what’s happened in this category like how do you reconcile that the view that innovation is successful at the high end at least in this category?.

Okay. Chris let’s go through this one in some detail because I think it’s instructive. And if you have the patience we will go through one or two others because I think they are instructive too. I would like to just take U.S. laundry and let’s go back to about a year ago in early September when we were at Barclays.

And you may recall that we announced a series of fabric care category brand and product innovations that would be coming to market in the middle or end of the first quarter of 2014.

I think we said at that time that they included the extension and expansion of our Pods product innovation to Gain and Ariel and two other countries like China and Japan which I spoke.

We announced strengthening of our heavy duty liquid product offerings the so called value added offerings to meet consumer needs that were unmet and we announced the introduction of Tide Simply Clean & Fresh to meet unmet consumer needs and mid-tier segment and category.

I think at the time we pointed out that virtually all of the category growth and most of our P&G sales growth and value creation would come from the Pods and the value-added, heavy duty liquid, brands and product lines.

So, let’s look at when happened, while in September and October, the media and many of our analysts commented on the program, and 95% of the commentary was on Tide Simply Clean.

In October, November, and December, our three main economy competitors all unleashed a series of essentially price rollbacks and price discounting and temporary promotion after temporary promotion, all of which has continue to present. We started shipping in mid to late February. And frankly, we couldn’t keep up with all demand of customers.

So, we were probably well established in stores that retail by March and the beginning of April. Now, let’s look at what’s going on with the market shares, week-by-week from let’s say the time that we really got established by retail.

Well, lo and behold, we’ve increased market share every week, okay, and if you look at our past 52 week share and compare it to our past four week share were up a full share point.

Now, what else went on in the market, well, with all of that spending by the economy players, they essentially took dollars out of the category, which concerned some of the retailers and basically they traded cases, dollars, and share and made less profit on the ones they trade it.

So, yes, there was a winner in that group, but they were also losers in that group. I think there is some indication.

We think there is some early indication that may be we’ve reached the point where it’s pretty clear about what the middle and premium part of this category is going to look like and what the economy part of this category is going to look like.

And then if we turn to Tide Simply, I think we said last September that the worst case scenario would be – we get a big share and we cannibalize from ourselves.

While we’ve gotten a medium size share frankly about what we thought it might be and we still don’t know where to land up because it’s still only got 50 plus percent retail distribution and relatively low travel rates among its target, but over 60% of it has been net extra to us. So, I don’t look at this week versus the same week year ago.

I don’t look at this quarter versus the same quarter a year ago. I look at shares overtime. We’re on our way, we think back to 60 a share, we have only had 60 a share of dollars a few times in the history of this company and in fact peak, it’s not a 62 to 63 when one of our principle competitors withdrew from the market back in 2007.

But we have a higher share, the higher share we’ve ever had at the value created. So, that’s how we think about it. I know I’ve gone on a bit, but I just want to mention a couple of others so that you get the point. We didn’t talk about at this morning. But in our diaper business in the U.S.

and North America, we’d rather quietly move back to share leadership, which we lost 20 years ago when our competitors brought training pants to market and we recaptured it in the last 18 months and we’ve opened up a spread of almost 6 share points on diapers and I think a couple of share points plus on the whole baby care category that counts wipes and some of the other product lines.

But how do we do that, okay, how do we do that without pants? Well, we did it because our baby stage of developments line of product and particularly Swaddlers which is unique consumer preferred etcetera has just cumulatively year-after-year slowly, but surely increased its trial, increased its share and is now just in and of its own right, a $600 million sub-brand that we think, now that we offer Swaddlers on all sizes, now we are finding moms actually prefer the designs could become a $1 billion business.

So, my only point is I want to look at the cumulative impact of our brands and our products. Last point, in 2007, we introduced a novel totally new proprietary product and technology on Always. It was called Infinity.

I think we weren’t as clear as we could be with consumers about what the product was and what it did, but without boring you in all the details, it is a very unique ultra-thin phone product far and away the best absorbing. This past year, we had all kinds of issues trying to get a totally new technology in manufacturing process started up.

We struggled as I said to connect with consumers, but this last year we did over $200 million on Always Infinity. We have now expanded into parts of Asia and parts of Europe. It represented 15% to 20% of our growth. It’s a clearly superior product. Women who have tried it and purchased it are repurchasing it at a rate of 60% to 70%.

So, I actually see across most of our categories, brands and products that are really unique and/or highly differentiated that when properly presented to consumers when the values clearly explained and if they have a chance to try it, that we can drive a lot of conversion.

And final point, I am not going to take you through the details, but virtually every brand and product line we sell even in the U.S. is dramatically under-tried, dramatically under-tried. So, we will be back at ensuring that consumers who are prospects for these brands and product lines have a chance to really try the product and give it a chance.

Sorry, Chris, I went on a long time, but I wanted to make the broader point about brand differentiation, product superiority, and consumer preference..

Your next question comes from the line of Nik Modi with RBC Capital Markets. Please proceed..

Yes, thanks.

Hey, AG, maybe you can just provide a little bit more context on the streamlined portfolio, will there be a geographic angle for this as well or is it just hey, these are the 80 brands that we are going to focus on globally, or if you look at it on India or Venezuela or Brazil, are there certain brands that maybe you will pullback from even though they are a global brand? Thanks..

Okay. Understandable question, I am going to – hopefully, I will be able to answer this as clearly as possible. Remember, Nik, we are shopper and consumer driven. And that means where all of the shopping and consumption occurs locally. So, if and when we get this right, we will have the right mix of brands, product lines, and SKUs for China.

We will have the right mix for Brazil. We will have the right mix for the Arabian Peninsula and Turkey. We will have the right mix for India and the sub-Sahara. Okay, so this is totally shopper and consumer driven. We looked at the real growth and value creation potential.

And as I pointed out, these are brands that for sometime have not been delivering on that front, okay. So, yes, if we get this right, we will have the right – we will not be short of brands or products to win in any market we choose to compete in.

And eventually, I think as you know, that’s going to mean all the emerging markets of the world, because that’s where the demographics will be driving us. That’s where the babies are born. That’s where the households form. That’s where incomes are rising.

So, we think this positions us just as well in emerging markets as it does in any developed market..

And if you think about the screen, we talked about earlier, Nik, which is businesses that play to our strengths. Typically, when we are operating the business that does play to our strengths, we can operate that business globally. And so this is not a – there is not a geographic frame to this.

It’s as AG said consumers, shoppers match with P&G strengths..

Yes. And Nik, just one more thing, so again in our attempt to help everyone understand, in some cases, it’s simple. We sell one brand name everywhere in the world, Pampers, Pantene, okay. In some we sell two, Always Whisper. In some of our lines in fabric, in home, in beauty and personal care, we sell what we call clone brands.

Okay? So, the principal brand might be Rejoice okay, but we sell Rejoice under a different name, okay in individual markets, because that’s sort of the history of the brand. We keep those brands, same in laundry, same in cleaning. So, we are very practical. We are very consumer and customer driven.

And we worked outside in from the markets to our brands and then to our business categories and sectors..

Your next question comes from the line of Ali Dibadj with Bernstein. Please proceed..

Hey, guys. So, before I get to the question and I often hate doing this, but I think it’s worth just a comment, because I have heard it from many investors. I am not sure you did yourselves many favors on the – in the press release not talking about the quarter really at all.

So, we all got to Page 13 or whatever it was saying that there is some rounding and beauty was down three, but there is no explanation, I am not sure you did yourself any favors. So, just for the sake of it heard from a lot of people, want to put it out there.

The question though more is around just again learning more about this very interesting structural change. So, it feels like I think most people’s ingoing assumptions was 10% of the business that was going to be divested was going to be more along business segment lines.

And now I think you are flipping a little bit and talking about it from a branding line. So, I want to understand that if that’s true? And then a few questions that come out of that.

One is lots of changes and the rationale is focus, which I get, but where do you know where the right balance is? So, why isn’t something even further like a bigger breakup not the right answer? How did you make that decision? And then also from a focus perspective, if these brands are going to sell, are about 10% of the sales, 5% of operating profit, can you give us a sense of how much of your time, management’s time and resources were on those? And then last want to go back to a question from before, I give you another chance, if AG, the Board says we want you here through this 12 to 24-month period, big transition period, we trust you to do this, do you want to be there for that time? Thanks for all those..

Criteria-driven, I am having fun. I am full of energy. I am 24/7. So, that will take care of the last one..

If my e-mail volume is any indication, it just backs up what AG said, he is here and working hard..

Second point, Ali, it’s strategy first structure second, right. Structure supports strategy. Third point is ultimately it’s about competitive advantage and value creation, right. So, we don’t see – we see competitive advantage in multi-industry sector participation. We see competitive advantage in technologies that flow across categories and industries.

We see competitive advantage in sourcing as a company and providing information and other services as a company and purchasing as a company.

So, when we do the math on the value creation, we get to this choice, strategic choice, this set of businesses has the potential to be the biggest value creator, right, which should be in the interest not only of our company, but also of our shareowners.

But yes, I mean, the balanced point is a very fair one and I am not going to tell you that any of us are good enough to get this precisely right. And you know what we will adjust as we go. I can’t tell you whether a 50-brand company might not be a little bit better than a 70-brand company if you see what I mean, okay.

The last point to your direct question is the management distraction is episodic intermittent and not the driver. The activity and complexity that clogs us up is the real issue, okay. Let’s just take SKUs, okay.

I don’t know what the end result will be here, it’s being worked business-by-business and iteratively, but believe me the SKU reduction will be a lot bigger than the 10% up to sales line or revenue line. Let’s take product lines, the same, okay.

So all of the sudden, one of the reasons that a number of our businesses have performed better is because the businesses and the R&D team and I all sat down in July and we sat down several times since and we just pruned out the bottom 10%, 20%, 30%, 40% of the activity and focused on few others and that’s accelerated better products to market.

The businesses – some of the businesses that Jon mentioned in other businesses that did really well this last year didn’t well because there were extremely focused.

And the last point and I could use the whole bunch of different examples here when you’re carrying the bag, I’ll use the old metaphor, with all the P&G brands and product lines in it to distributor or wholesaler to one of our sophisticated retail customers believe me, it is a huge advantage to be selling fewer leading consumer and shopper preferred brands and product lines..

Your next question comes from the line of Michael Steib with Credit Suisse. Please proceed..

Thank you, good morning. I have a couple of questions please. AG, you mentioned, you emphasized really the importance of having the right balance between premium priced products on the one hand and affordable products on the other hand, where the consumer demands it.

I was wondering in the core brand portfolio of 70 to 80 brands that you have identified now. Do you think that that balance is right at this point? And in other words, should the sort of negative mix effect on the top line going forward be less of a headwind once you’ve gone through these various disposals? That’s my first question.

And then Jon, forgive me just for asking a financial question, but given your outlook for fiscal ‘15, you suggested that essentially the top line growth is going to be against tough comps in the first half and cost savings will build through the year? Should we therefore expect earnings growth to be sort of flattish in the first half and it all comes good in the second half? Thanks..

A couple of things and one on the expectation of the reduction and negative mix on the top-line as we go forward, that will in all likelihood continue. We’ve been pretty clear about that.

It’s driven by disproportionate growth in developing markets, which we expect to continue and as we move consumers up those portfolios overtime that impact will lesson as developed market growth is reintegrated that dynamic will lessen, but it has been with us and we’ll likely be with us for some period of time.

On the guidance question, we’re not providing quarterly guidance, but all dynamics that you talked about are the right ones. I think you focus on the right things and I’ve encouraged you to follow-up with the IR team later today. And I’ll let AG to handle the question on whether we’re priced right broadly..

Yes, Michael, let me try to make the couple of strategic points and then I’ll try to give you some insight into where we think we are at this moment in time.

The first thing is incredibly important and often not well understood and that is the issue in our industry in household products and personal care products is almost always consumer perception of value and value has different drivers in different categories and different brands. Price is one of them.

Okay, price is one of them, but brand awareness and trial rates and household penetration, brand equity, okay, product performance also are incredibly important. Second point, we have a huge opportunity to get a lot clearer with consumers about what the value equation really is. I am going to give you a specific example from Gillette.

We talked earlier that we just introduced FlexBall and it’s off to a good start. We will see how it does. Alright. We did pre-market research in a blind context, so they don’t know what the brand is and the new FlexBall razor was preferred 2 to 1 by system users versus the best performing product in the market, which happened to be our ProGlide.

We are now in the market four, six, eight weeks. We went out and did a 400 male person panel, where we asked them to use the new FlexBall razor versus whatever they are using today. So, we had disposable users. We had shave club users. We had system users. We had electric razor users. 95% of them preferred a FlexBall, 95%.

Interestingly, a lot of disposable users by the way half of the world, okay, uses the disposable razor today. The interesting thing is disposable users often say they use disposables because they think it shaves just as well as a system, many of them have never used a system. And they think it’s a better value.

So, their first belief if they try and use the FlexBall, they see it is a totally different experience and result. And then the second thing is when you ask them what they think the prices or the cost is or the value is, they always say it’s way more expensive when we tell them.

You can have a cartridge for $1 a week, they are astounded and then we show them the math.

So, my only point here is if you just read the Wall Street Journal, okay or if you just listen to the anecdotes in the Street or if you look at the $50 for 10 cartridge pricing in some retail establishments, you may perceive that the price is high, but the actual price per use and the actual quality and performance of the use is better.

And that’s incredibly important. Now, that the direct question, I said in my prepared remarks where in some businesses, where the price point doesn’t matter or in fact a higher price point is better. I saw more SK-II when my price point is better.

We sell a lot of Oral-B electric toothbrushes at very high price points and I could go on and on throughout our line. But if you step back and look at all of our businesses around the world, we are in the best shape we have been in three years in terms of our relative pricing.

In other words, we have the smallest percentage of our total business that has a price gap and is losing share. And here is the important part. The three biggest opportunities are tissue towel in North America, which is Bounty and Charmin and laundry, which Chris asked me about earlier, all of which are being addressed, okay.

Interesting point there on laundry is major retailers are sort of discounting Tide 15% to 20%. It’s still a better deal for them, because Tide at a 15% discount is the higher price and generates more value for them than the balance of the category.

Last point on this one, the number of opportunities we have, where we are priced low where we should be or mixing below where we should be are as large or greater than the opportunities we have to adjust our price..

And your final question comes from the line of Steve Powers with UBS. Please proceed..

Believe it or not a few more questions, if I could. First Jon, maybe I missed it, but did you offer any cost or timing estimates associated with the supply chain restructuring that you are undertaking.

And then second taking a step back you are clearly making progress on the cost cutting especially in SG&A, but the top line continues to lag a bit, this quarter it does feel like you rounded up 2% organic growth in the quarter, so does it make sense to drop all these marketing efficiencies to the bottom line or should you be reinvesting even more aggressively.

And then lastly maybe related to that, AG as you said it all starts with the consumer and you guys have been long known for leading consumer insight capabilities, so what specifically is the consumer telling you that you need to do better in the market that you are not doing and maybe you can just talk about that in the context of beauty for example? Thanks..

In terms of the marketing I mean we are perfectly happy to reinvest and are looking for opportunities to reinvest and feel that we can do that and continue to become both more effective and more efficient.

We are going through a transformation in this industry that we want to take advantage of while remaining fully in front of consumers with our marketing efforts.

And so we look at things like the reach, the frequency, the targets that we are reaching, the conversion rates on the messaging and that’s much more important than actual dollars spent given what’s happened in that industry. But you should not mistake this for a second as lack of willingness to invest behind smart ideas to build the top line..

Yes. We are maintaining or increasing our investment in marketing that works and we are driving for savings and frankly non-working dollars or other efficiencies that you get from the move to more digital mobile, social, etcetera. On the consumer insight side that is the focus, the full focus of a lot of people in this organization.

And again I think we had a lot of activity going on and we weren’t relentless about digging, digging, digging for shopper insights and consumer insights. Very simple thing, the mindset at Gillette was to test the new system with system users. You sort of slap yourself in the forehead and say well, wait a second.

Everybody grooms, some people do a clean shave some people do a sculptured groom in the face. Some people body groom. Let’s first of all understand what the job to be done is. And then second of all let’s make sure we are putting together instruments, okay and experiences that meet all the needs.

So I mean we are going to sell an opening price point disposable razor from Gillette at I don’t know $2 to $3 and we will take you all the way up to $200 to $300 if you want to buy art of shaving product or a top of the line Braun product. Specifically regarding beauty, look here is the headline on beauty.

In terms of value creation they were one of the better performing sectors this last year. Unfortunately it was a little unbalanced, too much of the value creation came from cash and profit improvement, although I will take it and there is a lot more there. Secondly, the progress we are making, okay.

The Old Spice and Safeguard some of the hair care brands we had – we showed some real progress on Pantene in a lot of important countries around the world, still not the progress I would like. In the U.S.

we had a little bit of share pickup in the first quarter which excited some of our competitors and turned into a second quarter that was heavily promoted, but anyway we will get through that.

But Pantene is growing very strongly in important places like Brazil it was growing in – sequentially in China, it’s growing and in a lot of developed and emerging markets. And I can see the product program starting to come. Head & Shoulders has just gone from strength to strength. Herbal is growing again. Vidal is growing again in key markets.

So I think that’s going to come. And then before the year was out, even on Olay which is still struggling we have some real encouragement in a couple of places. We had two of the top five new facial cleanser products, two of the top five new facial moisturizer products.

And this line called Luminous is actually driving a little bit of share growth in the past couple of months. So, the bigger point, okay, the bigger point is the one you made, which is everything begins with shopper understanding and consumer understanding.

And when we have it and understand it that informs importantly and allows us to do a much better job with our brand idea and our product pipeline and portfolio..

I want to thank everybody for joining us this morning. I realized we didn’t get to everybody. It’s a cheap substitute, but I am available the balance of the day. Don’t hesitate to call, John and the team, are here as well. And we thank you for your participation..

Ladies and gentlemen, that concludes today’s conference. Thank you for your participation. You may now disconnect and have a great day..