Proctor and Gamble 2005 Annual Report Download - page 22

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Net Sales
(in billions of dollars)
2004 20052003
15.2
16.8
18.4
2.5
Net Earnings
(in billions of dollars)
2004 20052003
2.3 2.5
Fiscal฀Year฀2005฀Results
P&G฀Household฀Care฀is฀part฀of฀P&G’s฀strong฀business฀
foundation,฀representing฀about฀one-third฀of฀the฀Company’s฀
sales฀and฀earnings,฀and฀contributing฀some฀of฀the฀highest฀
margins฀in฀the฀Company.฀In฀2005,฀P&G฀Household฀Care฀
results฀reflect฀the฀challenging฀environments฀in฀which฀many฀
of฀our฀businesses฀operate.
Volume฀was฀up฀8%฀and฀sales฀up฀10%.฀Top-line฀growth฀was฀
broad-based฀across฀the฀leading฀Household฀Care฀brands.฀
They฀include฀six฀of฀the฀Company’s฀billion-dollar฀brands฀–฀฀
Tide,฀Ariel,฀Downy,฀Pringles,฀Folgers,฀and฀P&G’s฀newest฀
billion-dollar฀brand,฀Dawn.฀Each฀of฀these฀brands฀posted฀solid฀
volume฀growth฀for฀the฀year,฀led฀by฀Tide฀and฀Downy,฀which฀
both฀grew฀double-digits.
Profit฀was฀up฀modestly฀versus฀the฀prior฀year฀as฀the฀benefits฀
from฀strong฀top-line฀growth฀were฀largely฀offset฀by฀high฀
commodity฀costs฀in฀our฀largest฀businesses.฀In฀the฀Coffee฀
business,฀we฀have฀been฀successful฀in฀pricing฀to฀cover฀green฀
coffee฀bean฀cost฀increases.฀In฀Fabric฀Care฀and฀Home฀Care,฀
we฀have฀increased฀our฀list฀prices฀in฀markets฀where฀the฀
competitive฀environment฀would฀allow.฀However,฀the฀benefits฀
from฀the฀price฀increases฀began฀to฀impact฀our฀results฀late฀in฀
the฀fiscal฀year฀and฀only฀partially฀offset฀higher฀materials฀costs.฀
In฀addition,฀we฀have฀implemented฀many฀new฀internal฀cost฀
savings฀programs฀in฀all฀areas฀of฀the฀business฀to฀help฀reduce฀
the฀need฀to฀raise฀consumer฀prices฀for฀our฀brands.฀These฀
challenges฀and฀our฀hard฀work฀to฀address฀them฀will฀continue฀
into฀fiscal฀year฀2006.
What’s฀Working
Our฀P&G฀Household฀Care฀mission฀is฀to฀make฀the฀฀
everyday฀lives฀of฀the฀world’s฀consumers฀a฀little฀brighter฀฀
and฀help฀them฀create฀a฀home฀they฀love.฀We฀do฀this฀by฀
understanding฀consumers’฀needs฀and฀then฀providing฀them฀
with฀innovations฀at฀an฀outstanding฀value.฀The฀concept฀is฀
simple฀–฀executing฀it฀is฀the฀hard฀part.฀And฀when฀we฀฀
execute฀well,฀consumers฀reward฀us฀with฀higher฀volume,฀
sales,฀and฀market฀share฀results.฀
As฀the฀global฀market฀leader฀in฀Fabric฀Care,฀we฀introduced฀
Tide฀with฀a฀touch฀of฀Downy,฀Tide฀Coldwater฀and฀Downy฀
Simple฀Pleasures฀in฀developed฀markets฀during฀the฀year.฀And฀
we฀grew฀our฀Fabric฀Care฀business฀in฀developing฀markets,฀
particularly฀Russia฀and฀China,฀by฀designing฀unique฀product฀
formulations฀to฀meet฀the฀needs฀of฀consumers฀across฀more฀
pricing฀tiers฀than฀ever฀before.฀
18
Top฀10฀P&G฀Household฀Care฀Brands฀(Net฀Sales)
Febreze฀Air฀Effects฀฀
gained฀14%฀market฀฀
share฀in฀less฀than฀one฀฀
year฀after฀its฀U.S.฀฀
launch฀in฀the฀highly฀฀
competitive฀air฀฀
freshener฀segment.





P&G฀Household฀Care
Behind฀strong฀฀
growth฀in฀Europe฀฀
and฀expansion฀into฀฀
Japan,฀Lenor฀fabric฀
conditioner฀grew฀฀
global฀volume
>30%