The Procter & Gamble Company (PG) Earnings Call Transcript & Summary

Good morning, and good afternoon, everyone. I'm Steve Powers, Deutsche Bank's lead U.S. consumer packaged goods analyst. And today, I'm thrilled to welcome Procter & Gamble back to the conference, a company that has executed an impressive reacceleration of growth over the last few years while enhancing internal accountability, decision-making speed and general productivity and at the same time, maintaining leading free cash flow productivity and disciplined capital allocation. With us today to provide more context around that journey and update us on the path forward is Vice Chairman, CFO and COO, Jon Moeller, who has been an integral part of P&G's recent transformation. Welcome back to the conference, Jon, and a sincere thanks on behalf of everyone listening for being here. In terms of today's format, Jon is going to open up with some introductory comments to set the stage, then we'll use the balance of our time for Q&A. If you're listening to the session via the conference portal, feel free to submit questions at the bottom left of your screen, and I'll do my best to work them in when the time comes. And with that, Jon, over to you. Thank you.

Thanks, Steve. Good morning, afternoon and evening. Let me start by expressing my sincere hope that you and your families are safe and are doing well. As Steve said, I'm going to share a few slides, but plan to spend the majority of our time together answering questions that are top of mind. Before I get started, I need to let you know that, as you can see in our safe harbor statement, today's discussion may include a number of forward-looking statements. You can find important cautionary information in our most recent 10-Q report, which, together with a reconciliation of non-GAAP measures, is posted on our Investor Relations website. I want to start with our priorities in this crisis period. They have and will continue to guide our actions and our choices. Our first priority is to ensure the health and safety of the men and women we work with, our colleagues around the world. Second, we're maximizing the availability of products that help people and their families with their health, hygiene and cleaning needs, which have never been greater. The next priority is supporting communities, relief agencies and people who are on the front lines of this global pandemic. Taken together, these priorities help ensure P&G is there for employees, consumers and communities who have always been there for us. Employee safety and health. With guidance from medical professionals, we're constantly evaluating and updating the robust measures already in place to help our people, who are making, packing and shipping P&G products, stay safe at work. This includes temperature scans, shift rotations, queuing avoidance and physical distancing. We're performing comprehensive, methodical cleaning of all production areas, including regular sanitization and surface disinfection that exceeds the most rigorous health authority standards. We're also partnering with our colleagues individually and proactively to ensure they feel and are protected and safe. This has never been more important as many of our facilities are running around the clock to deliver P&G products during this period of increased demand. Our industry-leading benefits play a critical role in providing P&G people with the resources they need to care for themselves and their families. From paid leave and comprehensive medical care, to flexible work arrangements and financial support, P&G people can work confidently knowing the company stands with and behind them. It's been inspiring to witness the many acts of service people are taking to support and care for each other demonstrating creativity, flexibility and commitments, truly P&G people at their best. Turning to product availability. P&G products play an essential role in helping consumers maintain proper hygiene, personal health and healthy home environments. Our products clean your laundry, your home, your hair, your body, your hands, and we clean and shave your face. We provide hygiene products for feminine protection, baby care, adult incontinence and bathroom needs. Hair care, shampoos to clean hair and conditioners and treatments to improve hair health. Facial cleansers, body wash, hand soaps and antiperspirants and deodorants address additional hygiene needs. Our OTC health care products provide proactive health benefits as well as important symptom relief. These products are more important than ever given the needs presented by the current crisis, the increased awareness around health and hygiene and additional time we've all been spending at home. We've been working lockstep with governments around the world to ensure we can continue to operate, enabling us to help people and their families meet their health, hygiene and cleaning needs. Our operations remain resilient. Currently, our 108 manufacturing plants, along with our network of external supply partners, are broadly operational, with only a few at modified capacity as a result of regulation, workforce travel restrictions, curfews, material availability or quarantine needs. The last few months have been a true test for our product supply planning and logistics organization, which they have passed with flying colors. Moving to the next priority. P&G has a long history of supporting communities in times of need with the products we produce and other forms of support. Millions of P&G products are being donated, helping to ensure that families have basic access to the everyday essentials that many of us take for granted. We're partnering to provide additional support to the world's leading relief organizations, including the International Federation of Red Cross, Americares and Direct Relief and key regional organizations, such as Feeding America, Matthew 25: Ministries, the China Youth Development Foundation, One Foundation, the Korea Disaster Relief Association, the United Way and more. We're working to protect health care workers and first responders. The United States Center for Disease Control has issued guidance recommending proper shaving when wearing N95 or similar respiratory masks to ensure proper mask fit for protection. Gillette is donating razors around the world to hospitals and other facilities to protect the people working to care for others. We've modified equipment to produce hand sanitizer in nearly a dozen manufacturing sites around the world, using it to ensure our people can continue to operate safely and sharing it with hospitals, health care facilities and relief organizations. Work is underway to produce critically needed nonmedical face masks. When fully operational in July, we expect to be producing more than 10 million masks per month. We have leveraged P&G R&D, engineering and manufacturing capability to quickly produce face shields in Boston and Cincinnati, which are currently being used in hospitals and COVID-19 testing centers. We're using our marketing and communications expertise to encourage consumers to support public health measures to help flatten curves and slow the spread of the virus. P&G is committed to the priorities of ensuring the health and safety of our employees, maximizing availability of products and helping society overcome its challenges. Our strategic choices remain the right ones and to serve each of these priorities. Our portfolio of daily use products, many providing health, hygiene and cleaning benefits in categories where performance plays a significant role in brand choice, superior science-based products delivered with superior packaging, retail execution, consumer communication and value in all price tiers where we compete. We've made investments to strengthen the long-term health and competitiveness of our brands, and we'll continue to invest to extend our margin of advantage and quality of execution, improving options for consumers around the world. The strategic need for this investment, the short-term need to manage through this crisis and the ongoing need to drive balanced top and bottom line growth, including margin expansion, each underscore the importance of productivity. We're driving cost savings and efficiency improvement in all facets of our business in our second 5-year $10 billion productivity program, cost productivity and cash up and down the income statement and across the balance sheet. Success in our highly competitive industry requires agility that comes with a mindset of constructive disruption, a willingness to change, adapt and create new trends and technologies that will shape our industry for the future. In this environment, that agility and constructive disruption mindset are even more important. How can we be even safer while both producing and helping more? What new needs must we meet? And what new ways? An ongoing mindset of constructive disruption and disruptive possibility. Our new organization structure: 6 industry-based sector business units that manage our 10 product categories with a differentiated approach in focused markets and enterprise markets. And very small corporate groups with best-in-class function expertise is also serving us well. A more empowered, agile and accountable organization with little overlap or redundancy, flowing to new demands, seamlessly supporting each other to deliver against our priorities around the world. These strategic choices we've made: to focus and strengthen our portfolio in daily use categories where performance drives brand choice; to establish and extend the superiority of our brands; to make productivity as integral to our culture as innovation; to lead constructive disruption across the value chain; and to improve organization focus, agility and accountability, are not independent strategies. They reinforce and build on each other. The best response to the uncertainties and sources of volatility we face is to double down on this integrated set of strategies, which are delivering very strong results. These integrated and mutually reinforcing strategies are a foundation for strong, balanced growth and value creation. The best response to what we are challenged with today is to push forward not to pull back, and that's exactly what we're doing. Strong results over our first 3 quarters in fiscal year 2020, following a strong fiscal 2019. Organic sales, up 6%; core earnings per share, up 16%; currency-neutral core earnings per share, up 18%; adjusted free cash flow productivity, 101%; over $13 billion of cash returned to owners. Each of these metrics in line with or ahead of objectives set going into the year. Building global value share. 31 of our top 50 country category combinations holding or growing share through the first 3 quarters of the fiscal year. In April, we announced a 6% increase in our dividend, reflecting both these results and the confidence we have in our future. This was the 64th consecutive annual increase and the 130th consecutive year in which P&G has paid a dividend. Our liquidity status remains very strong. We're a 183-year-old company this year, and we take a long-term view to balance sheet management. We aim to maintain our AA- credit rating and to manage within the ratios that supports that rating. In the long term, we remain well positioned to serve consumers and create value in an attractive industry. We really do believe there is a bright future, and our strategy is unwavering. Consumption of our products is not likely to dissipate. In fact, the relevance of our categories in consumers' lives potentially increases. We will serve what will likely become a forever altered health, hygiene and cleaning focus for consumers who use our products daily or multiple times each day. There may be an increased focus on home, more time at home, more meals at home with related consumption impacts. The importance of noticeable superiority performance -- superior performance potentially grows. There's potential for increased preference for established reputable brands that solve newly framed problems better than other alternatives, potentially less experimentation; potential for a lasting shift to e-commerce, both e-tailers and omnichannel. Our experience to date makes us believe we are generally well positioned in this environment. Increased demand has focused retailers on the core SKUs that drive the majority of the business. There is potential for this to result in a cutting of the long tail of inefficient SKUs and brands in our categories. We're discovering daily lower-cost ways of working with fewer resources, today's necessity birthing the productivity inventions of tomorrow. New digital tools are being brought to the forefront, providing another productivity rocket booster on the factory floor and in the office environment. So in the longer term, we believe that we are relatively well positioned to serve consumers' heightened needs and their changing behavior, to serve the needs of our retail and distributor partners across channels and geographies and to create value. In the short to midterm, outcomes are, frankly, anyone's guess. Epidemiologists still have wide variations in their best- and worst-case scenarios for viral spread, mortality, the shape and duration of the curves. We may see months of sporadic production suspension due to local quarantines or raw material supply. It's not just our operations that matter here. It's those of our suppliers, of contractors, of our transportation partners. A lot has to go right in a very challenging environment and not all of them will. Customers may close stores. There will continue to be extreme foreign exchange and commodity cost volatility. Added operational complexity will result in higher costs. Unemployment will impact incomes -- outcomes, perhaps severely. All of this occurs on top of what was already unprecedented uncertainty and volatility in our categories and markets. We will manage the short to mid-term, consistent with the strategy we've outlined many times and that I just outlined for you again against the immediate priorities of ensuring employee health and safety, maximizing availability of our products to serve health, hygiene and cleaning needs and helping society overcome its challenges. We're stepping forward, not back. We're doubling down to serve consumers in our communities. We're doing this in our interests and society's interest and in the interest of our long-term owners. With that, I'd ask Steve to rejoin me for Q&A.

Okay. Well, thank you, Jon. I guess, as I listened to you, it sounds like you're optimistic that all the work that you've been doing the last several years, all the strategic choices that you've made has helped prepare the company to better meet the demands of the current environment. Can you elaborate a little bit more on that topic? And also talk about whether this particular moment that we're all going through requires new thinking on top of that existing strategy. Or is it more, as you said, a doubling down or acceleration of the things you were already doing?

It's a bit serendipitous. But I think it would be difficult to design a strategy that was better fit for what we're facing today. If you think about the elements that I just referred to: daily use; health, hygiene and cleaning-focused categories; a commitment to superior performance at a time when consumers really need it; a well-developed productivity muscle, which is going to be important to overcome higher operating costs and to keep pricing at levels that provides superior value; an organization structure, when I think back to our old organization structure, which was confusing on a good day, would have been really confusing on a bad day with everybody working from home. This has been flawless from that standpoint. And it doesn't mean that we haven't had our challenges, but -- and then the whole mindset of constructive disruption, which leads to the second part of your question, which I'll get to in just a second. So I think it was a good and effective strategy in the prior environment. I think it is perfect for the environment that we face today where -- doesn't mean we won't have challenges again, but we're very well positioned. And then our job becomes waking up every day, putting our feet on the floor, executing and continuously disrupting in a constructive manner the ways in which we do business, the products with which we serve consumers. There's no time to rest in our industry in either a good time or a bad time. So you just think about the changes that we've all been through in terms of how we get our work done. And our challenge becomes capitalizing those -- on those in a constructive way to improve the strength of the business, to improve our ability to invest behind it, to further improve superiority of products, et cetera. I'll give you just a couple of examples. So one of my responsibilities is supply. And it's been remarkable to me to see what we and others have been able to achieve from a supply standpoint. Basically, in a nutshell, maintaining 90% or greater throughput with, on many days, 50% of the resources. Either because they're restricted from a travel standpoint or they're quarantined or there are other limitations that are placed, they're taking care of their children, who aren't going to school. But it's, again, remarkable what that organization has been able to achieve. And there are just literally dozens of very important learnings from them. I'll give you another example. We've had to -- these are operational in nature, but I'm a COO, so I guess that's okay. The -- if you think about maintaining the supply chain in this environment, I mentioned briefly earlier that it's not just ourselves that we have to -- that were impacted by. It's all of our suppliers. It's the entire supply chain, and they're facing the same challenges we are. And what that's caused us to have to do against our priority of making sure we have sufficiency in terms of product availability when consumers need it, is to rapidly qualify alternate sources of supply, rapidly qualify new materials and new formulations. Those are things that would have taken us 12 to 18 months in the past, and we're doing them in 5 or 6 days. So again, another big opportunity going forward. I'll leave it there.

Yes. And do all those early successes, is it -- are you still in -- is the organization still in reactive mode? Or are you able to reflect on what you've been able to accomplish as you're still reacting and actually start to think about what -- how that changes your concept of what's possible in the future, i.e., where you start to think, hey, maybe these -- this is unveiling opportunities that we didn't see 6 months ago?

It's very clear to everybody that this is unveiling opportunities that we didn't see 6 months ago or didn't know that we were capable of capturing. I would say that the state of the organization to move from reaction, to more proactive planning for the future, it differs greatly around the world. There are parts of the world that are still going up the curve, and they're in a very reactive mode, as they should be. But if I take the market of any size, that's probably further along in this journey, that would be China. I mean they're doing remarkable things, and their business is rebounding very quickly. I expect in the quarter that we're in that we'll have fully restored historical growth rates or better. And they are operating with a changed business model in many cases. If you think about the Skin Care business in China, that was a historically -- history being 5 months ago, was a heavily counseled business. In other words, you interacted with a salesperson in a -- typically a department store environment, who would analyze your skin needs and help you select products. That's effectively gone. So we've had to change that whole business model and enrich the interaction quality that exists in our online counseling efforts to personalize it even more in terms of one-on-one communication with consumers. And that business, like the Total, is responding very well. So different states of development, Steve, but -- and I hate to say this because you don't want to minimize for a nanosecond the human suffering that's occurred and that's occurring. But there are a lot of silver linings in this cloud. And I'm convinced we, and I'm sure others, will come out the other side of this -- it's not just a trite statement, it's true, much stronger for what we've been through.

Okay. I guess you also talked about how it's anyone's guess near term as to where we go from here. And -- but there's been a lot of -- there are a lot of questions about that. It's been a constant theme in the last couple of days. I guess can you frame for us how you are handicapping the economic backdrop and operating conditions in your categories across your key markets as you go forward, big debate around whether -- about the pace of recovery versus the severity and duration of a recession? Again, knowing there's uncertainty, how are you approaching the planning process?

Day by day. There's some really encouraging signs. First of all, we -- as we've talked this morning or this afternoon already, we, obviously, operate in daily use categories. And so at some level, we're less prone to the economic vagaries that, for example, the hospitality industry or the airline industry would be subject to. But the positive signs, I mentioned the rebound in China. And even from a -- you have to remember, that operation was shut down completely for over a month. And we're back to 98% service levels, strong demand. It is difficult to sort through in every market the volatility that exists in inventory, both in consumers' homes and in retail outlets. So it's murky, but the direction is positive. In Europe, May was very -- as those markets reopened, was very [indiscernible]. I think there was just a general hesitancy still to put yourself in a retail environment. And e-commerce is less developed there than it is in a market like China. But June so far has been good. So hopefully, that corner has been turned. The U.S. has remained strong. The areas of the world that I'm most concerned about on a human level, if not a business level, are the emerging markets. If you -- people face an incredibly difficult choice, people and governments. It's -- 55% of the economy of those markets in aggregate is informal. It's cash for the day's wage or day's labor. So your choice is, do I stay home and lose the ability to provide sustenance to my family because the government asked people to stay home, with much more catastrophic economic impacts that occur in developed markets, which by themselves, shouldn't be minimized. Or do I go to work? Do we ask people to go to work in very concentrated, crowded conditions, often 1 to 2-hour commutes on public transportation that's body to body and risk getting -- second, risk dying? And that's all against the backdrop of an underdeveloped health care system in almost all cases and almost no fiscal ability on the part of governments to assist. So the impacts you're seeing there are significant and I think will be for the near term. But all we can do is ensure that we're serving consumers through their difficulty in the best possible way we know how. And not letting up on that journey for continued improvement and making sure that when he or she is in need of one of our products, it's there. And so if I think about my time, I'm spending 98% of it on that as opposed to planning per se. I know that's not maybe as nourishing as people would like, and I apologize for that, but that's the current reality. But again, things have held up reasonably well. There are some very encouraging signals, but there is ever-present danger and risk.

Particularly in emerging markets, yes. The follow-up to that, I guess, is that things, as you say, are holding up. We've heard this broadly that there is this uncertainty that looms and varying degrees of concern around that uncertainty. But at the same time, demand holding up maybe better than expected, better than feared. I think we see that in some of the consumption data in the U.S., which took a dip earlier in the quarter, but have started to come back. How do you -- can you just talk us through -- you mentioned this earlier about the need to -- and the challenges of supplying for that demand and shipping to that demand. Can you talk -- update us on where sort of your business capabilities are in terms of shipments, catching up with that consumption trend? And has it led you to consider any -- either tactical capacity increases, leveraging third parties or structural capacity increases in categories in health and hygiene, where maybe there's a structural demand today that you didn't see 6 months ago?

I'm glad you mentioned that, I mean, the first part of your question, particularly. And it's another one of the silver linings. There's increased demand in a number of categories, demand levels that we never would have imagined, quite frankly. And just so people understand kind of how this works. If you're running efficiently in categories that have a high capital requirement. You do not structure yourself to have 30% excess or 50% excess capacity. That would be, in 99 years out of 100, a really dumb thing to do. And the more efficient you are, the bigger the challenge when a surge like this presents itself. We are doing everything that you mentioned, Steve. I mean the first thing we did was, as I mentioned briefly in our prepared remarks, was concentrate our SKU offering on the SKUs that really moved and really mattered, both to our retail partners and to consumers. And that got us about 15% additional throughput in many of our categories, which again, going back to one of your earlier questions, is a key learning as we go forward. We definitely have brought on additional contractors, additional suppliers, both from a capacity standpoint, but also from a business continuity standpoint, ensuring that we have options if somebody isn't able to overcome a challenge for a week or a month. And then we are building supply as we speak. I mean, a good example, we introduced a product called Microban 24 in February. It's a wonderful sanitization, home cleaning and home health product with the advantage that unlike most of the alternatives, provides 24-hour germ fighting protection. So once you clean a surface and -- in many -- with many alternatives, when you retouch that surface, it's contaminated again. But with this product, that decontamination benefit lasts for 24 hours despite repeated touches. As you might imagine, we're completely out of capacity on that item. We're 3x what we expected to be selling at this point in the introduction. And so we're rapidly going through the process of qualifying additional supply. But generally, I try to get out in a safe way into stores every weekend or 2, particularly in a time like this, just to see what's happening and in this context, really understanding how our shelves are holding up as an indication of where we are from a supply standpoint and meeting demand. And you can generally find toilet paper now. That's good. The category that's under the most pressure still would be our Home Care category, items like Swiffer, items like Microban and our OTC medicines category. Products like Metamucil, unrelated to the crisis, are doing extraordinarily well. So hopefully, that answers your question.

Yes. There are a number of questions that are coming in back on the theme of how COVID-19 and your action changes what you do in the future, and maybe kind of building off some of the constraints you're seeing. As you think across your, I guess, your 5 business segments, reporting segments or as you think operationally about digital competency and the boom we're all seeing in e-commerce, could you just, I guess, take us -- talk us through like how you're assessing the long-term business opportunity and what may be some of the learnings, the practices or how it's changing your objectives of the future? I'm not sure if that question was exactly as clear as I wanted it to be. But basically, it's -- is your outlook on what's the addressable markets changing materially? And if so, how? I mean the health and hygiene and opportunities there? And do you invest more in certain areas than you were going to and less in others? And how are you thinking through that?

I don't think there's really a major element of our portfolio that I don't think has significant growth potential going forward. And that responds to demand stimulus. I feel brighter about our long-term future in part because of how we performed the last couple of years, in part because of what we're learning now and in part because it just sets up really well for some choices that we've made. You mentioned e-commerce. I'm thrilled with the increase in e-commerce. And by e-commerce, I mean all forms, including omnichannel, walmart.com, target.com, including direct-to-consumer in some categories, and obviously, the aggregators, like Amazon and Alibaba. I really believe, and we've talked about this several times, many of us have, that, that world sets up well for large, trusted brands, particularly in categories where performance drives brand choice and the brand delivers superior performance. As we've talked again previously but it bears repeating, I think the assumptions on e-commerce in the early days were all wrong. I thought that then, I feel even more strongly about that now. And those -- the 2 key assumptions being that this was the land of endless assortment, and that there were no barriers to entry. I think both of those are just playing wrong. The assortment that a consumer exposes themselves to in an e-shopping trip is much lower. Very few shoppers go to the third and fourth, much less the fifth and sixth pages of the search. So the question becomes what brands land on the first and second page of a search. And in most of our categories, we're very well positioned in that regard, in part because the algorithm, even though no one talks about this, has a strong component of revenue to me, the e-tailer. And big brands offer a much larger revenue opportunity. What also determines -- as a determinant is ratings and reviews, not just the average score, but the depth of that average, how many 4s and 5s there are. And a number of exposure points for large brands that deliver and the translation into ratings depth is significant. So I don't believe that it's a land of endless assortment. I believe it's a land of limited assortment in practical terms. And so if I don't have those characteristics as a company or as a brand, how do I get on that first or second page? Well, there's only one way that happens, which is you create a revenue opportunity for the e-tailer that's equal to Tide. That's a huge barrier to entry. And I personally believe that's what has led to, in some ways, the advent of the DTC model in some markets and some categories because it's an attempt to go around that system where they have difficulty competing in. And I'm not convinced -- we don't have time for that right now, that that's necessarily a long term, viable, scaled solution either. But -- so the point is this shift to e-commerce, which we've seen during the crisis, big time in China, big time in the U.S., we grew our e-commerce business 40% last quarter, is a great setup for the future. I think we're -- we have to stay on our toes, and we have to execute every day. We have to have superior offerings at superior values. But there's nothing I see in the ecosystem as it's either evolving or being revolutionized that we can't take advantage of.

And how does that -- how much of those opportunities, whether it be addressable market opportunities that are emerging or capabilities that are required to meet demand? How does that influence? How much of that can you meet organically versus is it influencing how you think about your M&A strategy? And are you in the market from an M&A perspective now? Or is it just too volatile?

We aim to deliver our objectives organically, but we also are very open to smart additions. Let me give you another example that builds on several of your questions, and I'll bring it back to this question. Hair care, shampoo, a lot of people internally and a lot of people externally viewed shampoo and conditioners as being maybe a victim of COVID. People aren't going out as frequently. They are less obsessed with how they look. And my view was wait a minute. When you go out on your essential shopping trip or to the doctor, wherever, there are really only 3 parts of your body that are exposed: your hands, your face and your hair. And in terms of surface area, your hair is often the largest point of exposure. So this should be an opportunity to increase lost frequency. In many parts of the world, it's 1 or 2 times a week. We ought to be talking past 7 going on 14. So there are huge organic opportunities. And the way I bring it back to your question is we need to be careful about distracting ourselves from accessing those opportunities that exist within our current categories on our current brands and our current markets. But we shouldn't be blind especially the capability that may exist in a smaller acquisition. In terms of being in the market, it's extraordinarily difficult and that's -- it's not so much a financial question or a financing question. But think about the context of due diligence. Think about the need to really get to know a management team at a personal level. It's extraordinarily difficult in this environment. So that does temper, to some extent, the amount of risk that one might want to take on. And in some industries, it's not as difficult because a lot of it can be done virtually. But take the health care industry as an example, where the relevance of due diligence is very, very high, both from a regulatory standpoint and an operating standpoint. And I need to get in that plant. I need our experts in that plant. Well, who's going to agree to that, both on our side and their side? So it is challenging in the current environment. We will remain open to it and opportunistic. But our major thrust is going to be organic.

Okay. Great. We're closing in on the end of time, but I do want to ask one last question, kind of going back to where we started. As I think about the journey that you, as a company, have been on the last decade or so, there are 3 almost mental constructs that to me underpin so much of what's been successful. And that -- those call-to-action terms of multidimensional superiority and constructive disruption. And the idea that efficiency and productivity is as important to the organization as is innovation. That's always been a hallmark of P&G. Can you -- am I right that those are as powerful as I feel they are? And can you talk about just how much they have pervaded the culture of the organization and your confidence that they have such that they can be enduring pillars of strength in the future?

I think those are very, very, very important calls to action. I would add to them, though I think you've hit the core. The 2 I would add are: balance, a commitment to grow the top and bottom line at the same time, which may sound trivial or even academic. But it was one of our issues historically, and it changes the way you think about a whole lot of things. And the other, which we talked about last year at this conference, is how we source growth and committing ourselves to sourcing growth through growing markets because that changes the world. It's very different if you create new business, either in existing categories or new categories than if you take existing business. The financial dynamics are different. The competitive dynamics are different. The retail response is different. So one of the reasons to focus so much on multidimensional superiority is because it grows markets, which is much more sustainable growth. And oh, by the way, if you're the one who drives the market growth, you will build share. So it's not -- it doesn't work against the importance of share growth. It's how do you sustainably do that. In terms of the level of take-up and action internally, the last 2 days -- or that's not true, Monday and Tuesday, we began our planning process for next fiscal year with our Board of Directors. So each of the CEOs presented their thinking on their plans for next fiscal year as well as a reflection, obviously, on what had happened this fiscal year. The entirety of those conversations were rooted in the 5 things we just talked about, with no direction from me or no direction from David. So I -- there's very strong uptake. And more important, the plans and actions that are being taken are all built around this. I would never -- 7, 8 years ago, maybe even 5 years ago, hear a leader of 1 of our businesses talk proactively about the importance of productivity to fuel investment and market-growing superiority. Those thoughts didn't come together ever. And that's kind of the language -- and it doesn't really matter, obviously, what people say, but what they do. So I take a lot of comfort in the embrace of the organization on these 5 items. And I do think it sets us up well and sustainably for the future. We will have challenges. We compete in a very competitive industry. The world is changing very quickly. When you have 10 categories, not all 10 will hit on every day or every year. But generally, I think they will serve us well.

Great. I think we're going to have to leave it there. But Jon, thank you for your time. Thanks to all of you who are listening. And thanks again to Procter & Gamble for joining us today. Thank you very much.

Thanks, Steve.