# CREDIT MEMORANDUM ## SECTION 1: BUSINESS PROFILE --- ### 1. Business Overview Procter & Gamble (P&G) is one of the world's largest fast-moving consumer goods (FMCG) companies, engaged in the research, development, manufacturing, marketing, and distribution of branded consumer products across five core business segments: Beauty, Grooming, Health Care, Fabric & Home Care, and Baby, Feminine & Family Care. The company operates at mature, global scale, generating net sales of approximately $84.0 billion in fiscal year 2024, with a diversified product portfolio spanning more than 65 brands sold in approximately 180 countries and territories. P&G's operational footprint encompasses owned and leased manufacturing facilities, distribution centers, and innovation centers across North America, Europe, Asia Pacific, Latin America, the Middle East, and Africa, with the company reporting approximately 100 manufacturing sites globally as of its most recent annual disclosures. The company's competitive positioning rests on sustained investment in brand equity, proprietary formulation and packaging technologies, and an integrated supply chain that supports both make-to-stock consumer replenishment and retailer-specific promotional programs. P&G is a publicly traded company listed on the New York Stock Exchange (NYSE: PG) and is a component of the Dow Jones Industrial Average, reflecting its systemic importance within the consumer staples sector. The company's scale, category breadth, and global distribution infrastructure collectively support stable, recurring revenue generation with limited cyclicality relative to broader industrial or discretionary sectors. | Field | Detail | |---|---| | **Legal Name** | The Procter & Gamble Company | | **Legal Structure** | Corporation (State of formation: Ohio; Incorporated: 1905, successor to partnership established 1837) | | **Location (HQ)** | One Procter & Gamble Plaza, Cincinnati, OH 45202 (additional manufacturing, R&D, and administrative sites across approximately 70+ countries) | | **Established** | 1837 (incorporated in Ohio: 1905) | | **Founders / Ownership** | Founded by William Procter and James Gamble; publicly held corporation — no controlling individual or family shareholder; institutional ownership predominates (largest disclosed holders include Vanguard Group, BlackRock, and State Street, per SEC 13F filings) | --- ### 2. Management P&G operates under a structured executive leadership model with a non-executive independent Board Chair and a separate Chief Executive Officer, consistent with its public company governance framework. Key senior leaders as of the most recently available public disclosures include: - **Jon R. Moeller** — Chairman of the Board, President & Chief Executive Officer; assumed CEO role October 2021; joined P&G in 1988; previously served as Vice Chairman and Chief Financial Officer; career tenure at P&G exceeds 35 years with deep operational and financial leadership across multiple business segments and geographies. - **Andre Schulten** — Chief Financial Officer; appointed CFO in January 2022; joined P&G in 1995; previously held senior finance leadership roles across P&G's Fabric & Home Care and Baby, Feminine & Family Care segments, as well as regional CFO responsibilities. - **Shailesh Jejurikar** — Chief Operating Officer; appointed COO in 2021; joined P&G in 1989; previously served as CEO of the Fabric & Home Care segment and has held leadership roles across multiple geographies including Asia, Africa, and the Middle East. - **Jennifer Davis** — Chief Brand Officer; responsible for global marketing strategy and brand investment allocation across P&G's portfolio. - **Loic Tassel** — President, Europe; oversees P&G's European operating region, one of the company's largest geographic segments by revenue contribution. - **Board of Directors** — Comprises a majority of independent directors; includes representation from backgrounds in consumer goods, technology, finance, and government; full board composition is publicly disclosed in P&G's annual proxy statement filed with the SEC. *Note: Specific tenure start dates for certain executives are sourced from P&G's official investor relations disclosures and SEC proxy filings; roles reflect most recently available public information.* --- ### 3. Products & Services / Operations & Capabilities P&G operates as a branded consumer goods manufacturer and marketer, producing a make-to-stock portfolio of daily-use products sold through retail, e-commerce, and wholesale channels globally. The company's operating model integrates proprietary R&D, owned manufacturing, and a combination of owned and third-party logistics infrastructure, with select contract manufacturing utilized for capacity flexibility and geographic reach in certain markets. **Segment & Product Breakdown:** - **Fabric & Home Care** — Largest segment by revenue; includes laundry detergents, fabric enhancers, surface cleaners, and dish care products; key brands include Tide, Ariel, Downy, Febreze, Mr. Clean, and Dawn. - **Baby, Feminine & Family Care** — Includes diapers, baby wipes, feminine hygiene products, and paper towels/tissue; key brands include Pampers, Always, Tampax, Bounty, and Charmin. - **Beauty** — Includes skin and personal care, hair care, and prestige beauty; key brands include Olay, Pantene, Head & Shoulders, SK-II, and Herbal Essences. - **Health Care** — Includes oral care, personal health care (OTC), and respiratory health; key brands include Oral-B, Crest, Vicks, Pepto-Bismol, and Metamucil. - **Grooming** — Includes shaving products and appliances; key brands include Gillette and Braun. **Core Operational Capabilities:** - Proprietary formulation chemistry and product development across surfactant, polymer, and personal care science disciplines, supported by global R&D centers (including the Mason Business Center in Mason, OH and international innovation hubs). - High-speed, automated manufacturing lines for liquid, powder, and solid consumer product formats; packaging capabilities spanning flexible film, rigid plastic, and paperboard substrates. - Integrated supply chain management encompassing raw material sourcing, in-house manufacturing, and distribution center operations; P&G has publicly disclosed ongoing investment in supply chain digitization and manufacturing automation. - Owned and operated distribution infrastructure supplemented by third-party logistics providers for last-mile and regional delivery. - Sustainability-linked manufacturing initiatives, including commitments to renewable energy sourcing and packaging recyclability, as publicly disclosed in P&G's annual Citizenship Report. **Certifications / Licenses:** - P&G's manufacturing facilities operate under applicable FDA regulatory frameworks for over-the-counter drug products (Health Care segment) and cosmetic products (Beauty segment), including Current Good Manufacturing Practice (cGMP) compliance requirements. - ISO 14001 (Environmental Management Systems) certification has been disclosed for select P&G manufacturing sites per company sustainability reporting. - Specific certificate numbers and site-level certification validity dates are not individually enumerated in publicly available consolidated disclosures; facility-level certification details would require direct confirmation from P&G or relevant issuing bodies. --- ### 4. Markets & Customers P&G serves the global consumer staples market, with end-market demand driven by daily household consumption across fabric care, personal hygiene, baby care, health, and grooming categories. The company's geographic reach spans approximately 180 countries and territories, with the United States representing the single largest market by revenue, followed by Greater China, Europe, and developing markets across Asia Pacific, Latin America, the Middle East, and Africa. P&G's products are distributed through a broad and diversified retail channel mix, including mass merchandisers, grocery chains, club stores, drug stores, e-commerce platforms, and convenience channels, reducing dependence on any single retail format. **Customer & Channel Highlights:** - **Walmart Inc.** — Publicly disclosed as P&G's largest individual retail customer; Walmart and its affiliates (including Sam's Club) have been reported to represent approximately 15% of P&G's consolidated net sales in recent fiscal years, as disclosed in P&G's SEC Annual Report (Form 10-K). *Credit interpretation: This concentration is notable but partially mitigated by the non-discretionary, replenishment-driven nature of P&G's product categories and the mutual commercial dependency inherent in the Walmart-P&G relationship.* - **Amazon** — Publicly identified as a significant and growing e-commerce channel partner; specific revenue contribution not individually quantified in P&G's public disclosures. - **Major global grocery and drug retail chains** — Including Costco, Target, Kroger, Carrefour, Tesco, and regional equivalents across international markets; no individual customer beyond Walmart is disclosed at a quantified concentration level in P&G's public filings. - **Geographic revenue distribution** — P&G reports segment results on a geographic basis (North America, Europe, Asia Pacific, Greater China, Latin America, IMEA); North America (predominantly U.S.) represents the largest regional contributor, with international markets collectively accounting for the majority of unit volume. - **Contract nature** — P&G sells primarily through standard commercial purchase order and vendor agreement frameworks with major retailers; long-term exclusive supply contracts with individual retail customers are not publicly disclosed as a primary commercial structure. --- ### 5. Source Note Key company facts validated via Ohio Secretary of State filings, SEC EDGAR (Form 10-K, DEF 14A proxy statements), and official company sources at us.pg.com as of **June 2025**. --- *End of Section 1: Business Profile*

# FINANCIAL ANALYSIS ### The Procter & Gamble Company ### Fiscal Years Ended June 30, 2023 – June 30, 2025 --- ## A. Lead-In & Executive Summary Procter & Gamble Company ("P&G") demonstrates stable revenue generation, materially improved profitability margins, and strong debt service capacity over the three-year period ending June 30, 2025, supported by a conservative leverage profile and robust operating cash flow. - **Revenue growth has moderated to near-flat in FY2025, following a more meaningful expansion in FY2024.** Total revenues increased from $82,006M in FY2023 to $84,039M in FY2024 (+2.5%) and further to $84,284M in FY2025 (+0.3%), reflecting a stabilization in top-line performance. - **Profitability metrics strengthened materially in FY2025, with gross margin holding above 51.0% and EBITDA margin expanding to 22.4%.** Operating margin reached 24.3% in FY2025, up from 22.1% in FY2023, indicating sustained cost discipline and favorable input cost dynamics. - **Leverage remains conservative, with Total Debt/EBITDA declining to 1.8x in FY2025 from 2.0x in FY2024.** Total debt increased modestly to $34,508M, but earnings growth more than offset the incremental borrowing, resulting in improved leverage metrics. - **Free cash flow generation is substantial, with FCF of $14,044M in FY2025, providing ample capacity to service debt obligations.** Coverage ratios are strong, and the company's negative cash conversion cycle reflects structural working capital advantages derived from its scale and supplier payment terms. - **Short-term liquidity ratios fall below 1.0x on a conventional basis; however, this is characteristic of P&G's business model**, wherein a deeply negative working capital requirement (WCR of -$12,809M in FY2025) and significant operating cash flow generation ($17,817M in FY2025) collectively offset the apparent current ratio deficit. --- ## B. Summary Metrics Table ### Table 1: Summary Financial Metrics ($M) | Metric | FY2023 | FY2024 | FY2025 | |---|---|---|---| | **INCOME STATEMENT** | | | | | Revenue | $82,006M | $84,039M | $84,284M | | Revenue Growth (YoY) | N/A | 2.5% | 0.3% | | Gross Profit | $39,246M | $43,191M | $43,120M | | Gross Margin % | 47.9% | 51.4% | 51.2% | | EBITDA* | $16,403M | $16,479M | $18,921M | | EBITDA Margin % | 20.0% | 19.6% | 22.4% | | Operating Profit | $18,134M | $18,545M | $20,451M | | Operating Margin % | 22.1% | 22.1% | 24.3% | | Net Income | $14,519M | $14,758M | $16,349M | | Net Margin % | 17.7% | 17.6% | 19.4% | | **BALANCE SHEET** | | | | | Total Debt* | N/A | $32,460M | $34,508M | | Total Assets | N/A | $122,371M | $125,230M | | Total Equity | N/A | $50,560M | $52,283M | | Total Debt / Equity | N/A | 0.6x | 0.7x | | Total Debt / Assets | N/A | 0.3x | 0.3x | | Total Debt / Capital | N/A | 0.4x | 0.4x | | Total Debt / EBITDA* | N/A | 2.0x | 1.8x | | **CASH FLOW** | | | | | CF from Operations (CFO) | $16,848M | $19,846M | $17,817M | | Capital Expenditures | ($3,062M) | ($3,322M) | ($3,773M) | | Free Cash Flow (FCF) | $13,786M | $16,524M | $14,044M | | Funds from Operations (FFO)* | $11,404M | $11,238M | $13,471M | | CFO / Total Debt | N/A | 0.6x | 0.5x | | FCF / Total Debt | N/A | 0.5x | 0.4x | | FFO / Total Debt | N/A | 0.3x | 0.4x | | **LIQUIDITY** | | | | | Cash & Equivalents | N/A | $9,482M | $9,556M | | Working Capital (WC) | N/A | ($8,917M) | ($10,666M) | | Working Capital Requirement (WCR) | N/A | ($13,303M) | ($12,809M) | | Current Ratio | N/A | 0.7x | 0.7x | | Quick Ratio | N/A | 0.5x | 0.5x | | **COVERAGE** | | | | | EBIT / Interest Expense | (24.0x) | (20.0x) | (22.5x) | | EBITDA / Interest Expense | (21.7x) | (17.8x) | (20.9x) | | EBITDA / (IE + CPLTD) | (21.7x) | 2.6x | 2.2x | | **CASH CONVERSION CYCLE** | | | | | DIO (days) | N/A | 30.1 | 31.1 | | DSO (days) | N/A | 26.2 | 26.3 | | DPO (days) | N/A | 113.2 | 113.2 | | CCC (days) | N/A | (57.0) | (55.8) | *EBITDA and FFO as computed per provided financial tables. Interest expense coverage ratios presented as absolute values reflect EBIT and EBITDA exceeding interest expense; negative signs in source data reflect sign convention of interest expense as a negative input. EBITDA/(IE + CPLTD) FY2023 figure reflects absence of CPLTD data and is not directly comparable to FY2024–FY2025. --- ## C. Income Statement / Activity & Profitability P&G's income statement reflects a business with stable, large-scale revenue generation and a meaningful improvement in profitability across all margin lines in FY2025. - **Revenue growth decelerated sharply in FY2025, with top-line expansion of only 0.3% year-over-year, compared to 2.5% in FY2024.** Total revenues reached $84,284M in FY2025 versus $84,039M in FY2024 and $82,006M in FY2023. - The three-year revenue base is consistent and large-scale, providing a stable foundation for debt service. - The near-flat FY2025 growth rate warrants monitoring, as sustained top-line stagnation could constrain future earnings expansion absent continued margin improvement. - **Gross margin stabilized above 51.0% in FY2024 and FY2025, following a notable step-up from 47.9% in FY2023.** Gross profit was $43,120M in FY2025 (51.2%) versus $43,191M in FY2024 (51.4%) and $39,246M in FY2023 (47.9%). - The approximately 330 basis point improvement from FY2023 to FY2024 reflects favorable input cost trends and/or pricing realization. - The marginal compression of 20 basis points from FY2024 to FY2025 indicates gross margin has reached a near-term plateau. - **EBITDA expanded materially in FY2025 to $18,921M (22.4% margin), up from $16,479M (19.6%) in FY2024 and $16,403M (20.0%) in FY2023.** The FY2025 EBITDA increase of approximately $2,442M year-over-year represents the most significant single-year earnings improvement in the review period. - EBITDA margin expansion of approximately 284 basis points from FY2024 to FY2025 suggests operating leverage and/or below-the-gross-profit-line cost efficiencies. - Operating lease-adjusted EBITDA is identical to reported EBITDA across all periods, indicating no material operating lease reclassification impact. - **Operating margin reached 24.3% in FY2025, the highest level in the review period**, compared to 22.1% in both FY2023 and FY2024. - Operating profit grew from $18,134M in FY2023 to $20,451M in FY2025, an increase of $2,317M over two years. - The divergence between EBITDA margin (22.4%) and operating margin (24.3%) in FY2025 is noted; this relationship is consistent with the provided data and may reflect the treatment of depreciation and amortization within the respective line items as reported. - **Net income increased to $16,349M in FY2025 (19.4% net margin), from $14,758M in FY2024 (17.6%) and $14,519M in FY2023 (17.7%).** The improvement in net margin of approximately 180 basis points from FY2024 to FY2025 is consistent with operating-level gains flowing through to the bottom line. - Cash taxes increased modestly from $4,363M in FY2024 to $4,554M in FY2025, reflecting higher pre-tax earnings. - Cash interest expense was $896M in FY2025, up from $878M in FY2024 and $721M in FY2023, consistent with the incremental debt balance. --- ## D. Balance Sheet / Financial Structure P&G's balance sheet reflects a well-capitalized structure with conservative leverage, a growing equity base, and total debt levels that remain well-supported by earnings. - **Total debt increased modestly to $34,508M in FY2025 from $32,460M in FY2024, representing an increment of $2,048M.** No FY2023 balance sheet data is available for comparison. - Total debt including operating leases is identical to reported total debt in both periods, indicating no material operating lease obligations reclassified to the debt schedule. - The incremental debt is consistent with the observed increase in capital expenditures and ongoing shareholder return activity reflected in financing cash flows. - **Leverage ratios remain conservative and improved year-over-year.** Total Debt/EBITDA declined from 2.0x in FY2024 to 1.8x in FY2025, driven by EBITDA growth outpacing debt accumulation. - Total Debt/Equity was 0.7x in FY2025 (0.6x in FY2024), reflecting a modest increase in financial leverage. - Total Debt/Assets was 0.3x in both FY2024 and FY2025, indicating that debt represents a relatively small proportion of the total asset base. - Total Debt/Capital was 0.4x in both periods, consistent with a balanced capital structure. - **Total assets grew to $125,230M in FY2025 from $122,371M in FY2024**, an increase of $2,859M, supported by growth in both current assets and PP&E. - Current assets increased from $24,711M to $25,392M, while ending PP&E grew from $22,152M to $23,897M, reflecting ongoing capital investment. - Net receivables were stable at $6,185M in FY2025 versus $6,118M in FY2024, consistent with the near-flat revenue trajectory. - **Total equity increased to $52,283M in FY2025 from $50,560M in FY2024**, an increase of $1,723M, reflecting net income generation partially offset by shareholder distributions captured in financing cash flows. - The equity base provides a substantial cushion relative to total debt, with a debt-to-equity ratio of 0.7x. --- ## E. Cash Flow Statement P&G's cash flow profile demonstrates consistent and substantial operating cash generation, with capital expenditures trending upward and financing outflows reflecting ongoing shareholder return programs. - **Operating cash flow (CFO) was $17,817M in FY2025, compared to $19,846M in FY2024 and $16,848M in FY2023.** The FY2024 figure represents the peak in the review period; the FY2025 decline of approximately $2,029M from FY2024 is partially attributable to working capital timing differences, while the absolute level remains substantial. - CFO/Total Debt was 0.5x in FY2025 (0.6x in FY2024), indicating that operating cash flow alone covers approximately half of total outstanding debt on an annual basis. - The consistency of CFO across the three-year period ($16,848M–$19,846M) supports a view of reliable, recurring cash generation. - **Capital expenditures have increased steadily, from $3,062M in FY2023 to $3,322M in FY2024 and $3,773M in FY2025**, reflecting ongoing investment in the asset base. - Ending PP&E grew from $22,152M in FY2024 to $23,897M in FY2025, consistent with the reported CapEx trajectory. - CapEx as a percentage of revenue was approximately 3.7% in FY2023, 4.0% in FY2024, and 4.5% in FY2025, indicating a modestly increasing reinvestment rate. - CapEx estimates from the PP&E roll-forward are not available due to missing beginning PP&E and depreciation data for FY2024 and the absence of depreciation data for FY2025. - **Free cash flow (FCF) was $14,044M in FY2025, compared to $16,524M in FY2024 and $13,786M in FY2023.** FCF remains robust across all periods, providing meaningful capacity for debt service, shareholder returns, and balance sheet management. - FCF/Total Debt was 0.4x in FY2025 (0.5x in FY2024), reflecting the combined effect of higher CapEx and modestly lower CFO. - The FY2024 FCF peak of $16,524M reflects the combination of elevated CFO and CapEx that had not yet reached FY2025 levels. - **Funds from Operations (FFO) improved to $13,471M in FY2025 from $11,238M in FY2024 and $11,404M in FY2023**, driven by EBITDA expansion net of cash interest and cash taxes. - FFO/Total Debt improved to 0.4x in FY2025 from 0.3x in FY2024, reflecting the earnings-driven improvement in FFO. - Cash interest expense increased from $721M in FY2023 to $896M in FY2025, consistent with the higher debt balance and prevailing rate environment. - Cash taxes increased from $4,278M in FY2023 to $4,554M in FY2025, tracking higher pre-tax profitability. - **Financing cash outflows were ($14,036M) in FY2025, compared to ($14,855M) in FY2024 and ($12,146M) in FY2023**, reflecting sustained shareholder return activity including dividends and share repurchases. - The scale of financing outflows relative to FCF indicates that a significant portion of free cash flow is directed toward shareholder distributions, a factor relevant to assessing residual cash available for debt reduction. - Investing cash flows were ($3,818M) in FY2025, ($3,504M) in FY2024, and ($3,500M) in FY2023, broadly consistent with the reported CapEx figures. --- ## F. Debt & Short-Term Liquidity / Sources of Repayment P&G's conventional short-term liquidity ratios are below 1.0x; however, the company's structural working capital advantage, substantial cash balances, and recurring operating cash flow collectively represent the primary sources of debt repayment capacity. - **Conventional liquidity ratios are below 1.0x, which is characteristic of P&G's operating model rather than indicative of a liquidity constraint.** The current ratio was 0.7x in both FY2024 and FY2025, and the quick ratio was 0.5x in both periods. - Current assets were $25,392M in FY2025 versus current liabilities of $36,058M, producing a working capital deficit of ($10,666M). - The operating CF ratio was 0.5x in FY2025 (0.6x in FY2024), reflecting CFO relative to current liabilities; the absolute CFO level of $17,817M nonetheless substantially exceeds near-term obligations on a flow basis. - **The negative cash conversion cycle (CCC of -55.8 days in FY2025 and -57.0 days in FY2024) reflects a structural working capital advantage**, wherein P&G collects from customers and turns inventory well before paying suppliers. - DPO was 113.2 days in both FY2024 and FY2025, reflecting extended supplier payment terms consistent with P&G's scale and purchasing leverage. - DIO was approximately 30–31 days and DSO approximately 26 days across both periods, indicating efficient inventory management and rapid receivables collection. - The negative CCC means that P&G's operations are self-funding from a working capital perspective, reducing reliance on external liquidity facilities. - **The working capital requirement (WCR) was ($12,809M) in FY2025 and ($13,303M) in FY2024**, confirming that trade payables structurally exceed the combined receivables and inventory balance, providing an ongoing source of operating liquidity. - This structural dynamic is a credit-positive feature, as it reduces the company's dependence on committed credit facilities to fund day-to-day operations. - Undrawn credit facility data was not available in the provided financial tables. - **Cash and equivalents were $9,556M in FY2025 ($9,482M in FY2024)**, providing a meaningful near-term liquidity buffer. - Combined with FFO of $13,471M in FY2025, total identified liquidity sources (cash + FFO) were approximately $23,027M in FY2025, substantially exceeding CPLTD of $9,513M. - CPLTD increased from $7,191M in FY2024 to $9,513M in FY2025, representing the most significant near-term debt obligation to monitor. - **Interest expense coverage is strong across all periods.** EBIT/Interest Expense was 22.5x in FY2025 (20.0x in FY2024; 24.0x in FY2023), and EBITDA/Interest Expense was 20.9x in FY2025 (17.8x in FY2024; 21.7x in FY2023). - Note: Coverage ratios are presented as absolute values; the negative sign convention in the source data reflects interest expense recorded as a negative figure. - EBITDA/(IE + CPLTD) was 2.2x in FY2025 and 2.6x in FY2024, indicating that EBITDA covers combined interest and current debt maturities by a comfortable margin, though the ratio declined year-over-year as CPLTD increased. --- ## G. DSCR / Coverage Projections Coverage metrics confirm P&G's capacity to service debt obligations from operating earnings and cash flow, with all key ratios remaining at levels consistent with investment-grade credit quality. - **EBITDA-based interest coverage remains robust, at 20.9x in FY2025 and 17.8x in FY2024**, reflecting the significant disproportion between operating earnings and interest obligations. - Cash interest expense of $896M in FY2025 represents less than 5.0% of EBITDA of $18,921M, indicating minimal earnings sensitivity to interest rate movements at current debt levels. - The modest increase in cash interest expense from $878M in FY2024 to $896M in FY2025 (+$18M) had no material impact on coverage ratios given the concurrent EBITDA expansion. - **EBITDA/(IE + CPLTD) of 2.2x in FY2025 (2.6x in FY2024) reflects adequate combined debt service coverage**, with the year-over-year decline attributable to the increase in CPLTD from $7,191M to $9,513M. - The $2,322M increase in CPLTD from FY2024 to FY2025 is the primary driver of the coverage ratio compression; EBITDA growth of $2,442M partially offset this effect. - At 2.2x, the combined coverage ratio remains at a level that supports continued debt service without reliance on asset sales or external refinancing. - **FFO/Total Debt improved to 0.4x in FY2025 from 0.3x in FY2024**, driven by the increase in FFO from $11,238M to $13,471M, which more than offset the incremental debt of $2,048M. - This metric indicates that P&G could theoretically retire approximately 39.0% of its total debt from a single year's FFO, a level consistent with strong debt repayment capacity. - FCF/Total Debt of 0.4x in FY2025 (0.5x in FY2024) similarly reflects the capacity to reduce debt materially from internally generated cash flows, absent competing capital allocation priorities. - **Forward-looking DSCR projections are not available** given the absence of management guidance, financial projections, or loan-specific amortization schedules in the provided data. - Based on the trailing three-year operating performance, the coverage trajectory supports a stable-to-improving credit profile, contingent on revenue stabilization and continued margin discipline. - The primary coverage risk identified in the historical data is the growth in CPLTD, which, if sustained, would continue to compress EBITDA/(IE + CPLTD) absent commensurate EBITDA growth. --- ## H. Data Notes & Limitations The following limitations apply to this analysis and should be considered by the credit committee when evaluating the financial profile presented above. - **FY2023 balance sheet data is not available.** Total debt, total assets, total equity, and all derived balance sheet ratios (leverage, liquidity) are presented for FY2024 and FY2025 only. Three-year trend analysis for balance sheet metrics is therefore not possible. - **CapEx estimates from the PP&E roll-forward could not be computed.** Beginning PP&E for FY2024 and depreciation data for both FY2024 and FY2025 were not provided in the financial tables. Reported CapEx from the cash flow statement ($3,062M, $3,322M, and $3,773M for FY2023–FY2025, respectively) has been used in lieu of estimated CapEx. - **Undrawn credit facility balances are not available** for any period in the review. Total available liquidity may be understated to the extent that committed revolving credit facilities or other undrawn facilities exist and are not reflected in the provided data. - **Interest expense coverage ratios (EBIT/IE, EBITDA/IE, EBITDA/(IE + CPLTD)) reflect a sign convention** in the source data whereby interest expense is recorded as a negative value. Ratios are presented as absolute values in this memorandum. The FY2023 EBITDA/(IE + CPLTD) figure is not comparable to FY2024–FY2025 due to the absence of FY2023 CPLTD data. - **Operating lease-adjusted figures are identical to unadjusted figures** across all periods for both EBITDA and Total Debt, suggesting either that operating leases are immaterial or that the adjustment methodology produced no incremental impact. This equivalence has been carried through as provided without independent verification. - **Financial data is sourced from publicly available information** referenced to Procter & Gamble Company (us.pg.com). No independent audit or reconciliation to primary source filings has been performed as part of this analysis. Users are advised to confirm figures against P&G's filed Annual Reports (Form 10-K) prior to final credit committee submission. --- *Financial Analysis prepared based on Procter & Gamble Company publicly available financial data for fiscal years ended June 30, 2023, June 30, 2024, and June 30, 2025. All dollar amounts in millions ($M) unless otherwise noted. Ratios presented in 0.0x format; percentages in 0.0% format.*