Proctor and Gamble 2001 Annual Report Download - page 17

Health care net sales in North America grew behind volume
progress on the strength of new businesses.
The Iams Company and Affiliates again posted record results, with
net sales up double-digits behind continued growth in North
America and expansion into new retail channels in the United
Kingdom, Italy and Japan.
Pharmaceutical net sales grew primarily due to the strength of
Actonel, the Company’s post-menopausal osteoporosis drug, which
achieved $150 million in total global sales. Actonel was launched
in 2000 and is now approved in 47 countries and currently
marketed in 30 countries.
Oral care top-line growth reflected the benefits of broadening the
appeal of core brands beyond cavity and tartar protection into new
whitening and cleaning products. Crest Whitestrips and Crest
Spinbrush are driving the trends toward at-home whitening and
powered brushing, respectively.
Western Europe health care net sales were below year ago, primarily
due to the weak euro. The expansion of Crest Spinbrush and the
continued growth of Actonel are expected to improve Western
Europe results next year.
In 2000, health care net sales were $3.91 billion, with growth
resulting primarily from acquisitions. Volume and net sales
increased 34% and 36%, respectively, versus the prior year.
Unfavorable exchange rates impacted net sales by 2%. Net
earnings were $335 million, a 38% increase over 1999.
Skin care delivered record net sales and share growth led by the
launch of Olay Daily Facials and Olay Total Effects.
In the past year, Cover Girl has built share in the United States
behind superior products. The cosmetics business posted strong
results behind recently launched Cover Girl Outlast and Max Factor
Lipfinity, breakthrough long-wearing lipsticks.
During the year, the Company announced the intent to acquire the
Clairol business, a world leader in hair color and hair care products
with prominent brands such as Herbal Essences, Aussie, Infusium,
Nice ‘n Easy and Natural Instincts. The pending Clairol acquisition
will represent the Company’s entry into the fast growing hair-
colorant category.
In 2000, net sales were $7.39 billion, comparable to the prior year,
but up 1% excluding the impact of unfavorable exchange rates,
primarily in Western Europe. Unit volume declined 2%, impacted by
a difficult competitive environment in key European markets and
significant contraction of the market in China. Net earnings were
$894 million, a 3% decrease from the prior year due to initiative
investments.
HEALTH CARE
Health care delivered exceptional growth on the expansion of new
products. Net sales were $4.35 billion, up 11%. Excluding a 3%
unfavorable exchange impact, net sales grew 14%. Unit volume
increased 15%, driven by the excellent performance of Iams pet
health and nutrition, pharmaceuticals and oral care businesses.
Net earnings were $390 million, a 16% increase over fiscal 2000,
consistent with volume growth.
The Procter & Gamble Company and Subsidiaries 15
Financial Review (continued)