The Procter & Gamble Company (NYSE:PG) Q1 2020 Earnings Conference Call - Final Transcript
Oct 22, 2019 • 08:30 am ET
Good morning and welcome to Procter & Gamble's Quarter End Conference Call. P&G would like to remind you that 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. Also as required by Regulation G, Procter & Gamble needs to make you aware that during the discussion, the Company will make a number of references to non-GAAP and other financial measures. Procter & Gamble believes these measures provide investors with useful perspective on underlying business trends and has posted on its Investor Relations website www.pginvestor.com a full reconciliation of non-GAAP financial measures. Now I will turn the call over to P&G's Vice Chairman, Chief Operating Officer and Chief Financial Officer, Jon Moeller .
Good morning. I know you're very busy this morning, so I'm going to make this very brief about 10 minutes, and then turn straight to your questions. Another strong quarter, top line, bottom line and cash, driven by our portfolio's superiority, productivity, constructive disruption and organization, strategies. Organic sales up 7%, four points of volume growth, three points of price mix. Two year stack growth strengthening to an average of 5.5%. Over the last five quarters, two year average growth has accelerated -- 2.5%, 3%, 3%, 4%, now 5.5%.
Growth continues to be broad based. Each global category grew organic sales. In our Personal Care, up mid-teens. Personal Health Care grew double-digits, Fabric Care, Home Care, Feminine Care, Family Care and Oral Care, each grew high singles. Hair Care grew mid-singles. Each geographic region grew organic sales 4% or more. Focused markets and enterprise markets each up high singles. Our two largest markets, the US up 6%, China up 13%.
Japan, another large market, was up double digits, due in part to the timing benefit of VAT changes that went into effect on October 1. eCommerce sales grew over 30%. All-channel consumption remained ahead of underlying markets, driving aggregate market share growth. Moving to the bottom line, core earnings per share was $1.37, up 22% versus the prior year. Foreign exchange was a $50 million after-tax headwind, about $0.02 per share. Our constant currency basis core earnings per share was up 24%, very strong underlying earnings progress. Core gross margin, up 190 basis points. Core operating margin up 260 basis points. Continued strong cash flow with adjusted free cash flow productivity of 91%. $1.9 billion of dividends paid, $3 billion of P&G stock repurchased. In summary, a very strong quarter, solid volume sales and market share trends across categories and geographies. Strong operating earnings, margins advancing, strong core earnings per share growth and continued high levels of cash return to share owners. We continue to face challenges from a very volatile macro and geopolitical landscape and from competitive response to our faster growth, but we're making progress behind integrated and mutually reinforcing strategies. We've focused and