P&G CEO admits to a tough year for the company and takes responsibility
Several shareholders made specific criticisms about the company's performance, with specific complaints being made about the company’s leadership, particularly in the past year.
During the open question time with Lafley, shareholder Karen Meyer, from Ohio, squared up to the soon-to-be replaced head of the business stating that it had been the ‘leadership that drove the P&G bus into a ditch’.
Investors see share value decline by 20% this year
Meyer underlined that she had seen her investment in the business decrease in value by approximately 20% during the course of the year, with share prices slipping from $94 a share in January, to the current rate of $74.
Meyer went on to demand what the solution was to remedy the situation, get the company back on track and see the recovery of investments made by herself and other shareholders.
“We are accountable, and the buck stops with me. There are tangible, concrete signs of improved operating performance across some of our biggest and most important businesses,” Lafley replied.
Half way through the transformation
He went on to state that the business was approximately half way through its transformation, and that some of the most important and most challenging restructuring strategies had already been implemented.
One of the most significant parts of this strategy has been to trim back the business portfolio significantly, from 160 brands to approximately 65 of the best performing ones in an effort to concentrate on the company’s core brands, providing increased focus and profitability.
Back in July the most important step towards this goal was made when P&G announced the sale of 43 color cosmetic and fragrance brands to Coty with a price tag of $12.5bn.
The deal includes leading fragrance brands such as Hugo Boss, Dolce & Gabbana and Gucci, which will only go to serve Coty’s strongest segment; while color cosmetics brands CoverGirl and Max Factor will certainly boost this business too, joining color cosmetics brands such as Rimmel, OPI, and Sally Hansen.