Proctor and Gamble 2015 Annual Report Download - page 74

The Procter & Gamble Company 72
Amounts in millions of dollars except per share amounts or as otherwise specified.
 
SUBSEUENT EVENT
On July 9, 2015, the Company announced the signing of a
definitive agreement to divest four product categories,
comprised of 43 of its beauty brands (eauty rands),
which will be merged with Coty, Inc. (Coty). hile the
ultimate form of the transaction has not yet been decided, the
Companys current preference is for a Reverse Morris Trust
split-off transaction in which P&G shareholders could elect
to participate in an exchange offer to exchange P&G shares
for Coty shares. The transaction includes the global salon
professional hair care and color, retail hair color, cosmetics
and fine fragrance businesses, along with select hair styling
brands. Combined, the eauty rands had $5.5 billion in net
sales for the year ended June 30, 2015. The Company expects
to close the transaction in the second half of calendar year
2016, pending regulatory approvals.
Cotys offer for the eauty rands, which was accepted by
the Company, was $12.5 billion. hile the final value of the
transaction will be determined at closing, based on Cotys
stock price and outstanding shares and equity grants as of the
date of signing, the value of the transaction was
approximately $15.0 billion. The value is comprised of
approximately 413 million shares, or 52 of the diluted
equity of the newly combined company, valued at
approximately $13.1 billion and the assumption of debt of
$1.9 billion by the entity holding the beauty businesses
immediately prior to close of the transaction. The assumed
debt is expected to vary between $3.9 billion and $1.9 billion,
depending on a $22.06 to $27.06 per share collar of Cotys
stock based on the trading price prior to the close of the
transaction, but will be subject to other contractual valuation
adjustments.
eginning in the quarter ending September 30, 2015, the
eauty rands will be reported as discontinued operations
in our Consolidated Financial Statements, with prior year
periods restated to reflect the same treatment.
 
UARTERLY RESULTS UNAUDITED
uarters Ended Se 0 Dec 1 Mar 1 un 0 Total Year
NET SALES 2014-2015  20,1  20,11  1,142  1,90  ,29
2013-2014 20,174 21,099 19,641 19,596 80,510
OPERATING INCOME (1) 2014-2015 , ,94 ,15 90 11,90
2013-2014 3,970 4,302 3,306 3,162 14,740
GROSS MARGIN 2014-2015 49.4 50.0 4. 4.0 49.0
2013-2014 49.4  50.4  48.9  47.5  49.1 
NET EARNINGS
Net earnings from continuing operations (1) 2014-2015  2,40  2,95  2,45  40  ,90
2013-2014 2,934 3,297 2,531 2,556 11,318
Net earnings(loss) from discontinued operations 2014-2015 20 5 2 102 1,
2013-2014 123 175 105 64 467
Net earnings attributable to Procter & Gamble 2014-2015 1,990 2,2 2,15 521 ,0
2013-2014 3,027 3,428 2,609 2,579 11,643
DILUTED NET EARNINGS PER COMMON
SHARE (2)
Earnings from continuing operations 2014-2015  0.9  1.02  0.5  0.22  .0
2013-2014 1.00 1.12 0.87 0.87 3.86
Earnings(loss) from discontinued operations 2014-2015 0.2 0.20 0.10 0.04 0.2
2013-2014 0.04 0.06 0.03 0.02 0.15
Net earnings 2014-2015 0.9 0.2 0.5 0.1 2.44
2013-2014 1.04 1.18 0.90 0.89 4.01
(1) The Company recorded a one-time enezuela deconsolidation charge of $2.0 billion before tax ($2.1 billion after tax) in the quarter-ended June
30, 2015. This impact is discussed more fully in Note 1.
(2) Diluted net earnings per share is calculated on earnings attributable to Procter & Gamble.