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 the underlying growth trends of the business and has posted on its Investor Relations website, www.pginvestor.com, a full reconciliation of non-GAAP and other financial measures. Now I will turn the call over to P&G's Vice Chairman and Chief Financial Officer, Jon Moeller. Jon R. Moeller - Procter & Gamble Co.: Good morning. I'm joined this morning by our Chairman, President and Chief Executive Officer, David Taylor, and by our Vice President of Investor Relations, John Chevalier. I'm going to quickly review our fiscal 2017 and Fourth Quarter Results. David will discuss our plans. And I'll close our remarks with guidance for fiscal 2018. We'll then open the call for your questions. We met or exceeded each of our going-in fiscal 2017 objectives in what turned out to be a very challenging year. India currency demonetization and goods and services tax implementation, geopolitical uncertainty and economic weakness in Nigeria, Egypt, and the Middle East, Argentina, Brazil, Russia, and the Ukraine, and also Brexit each challenged us. Foreign exchange and commodity costs were a combined $600 million after-tax headwind on earnings. And we took a direct hit from a tornado at our Albany, Georgia, family care plant.…

Thank you, sir. Your first question comes from the line of Stephen Powers with UBS.

Great, thanks. David, from the results this quarter and your outlook, it seems like you feel like you've turned a corner and are starting to build – rebuild momentum, which is truly great. And it leads to a question, what you think it will take to accelerate that momentum further? Which you started to answer with your discussion of the drive toward sustained superiority. But I was listening to you and thinking – and asking this question with two thoughts in mind. One is that it feels like more and more superior innovation is occurring on the fringes of the industry, as opposed to inside big incumbent operations. And two, which you started to touch upon, is that it feels like much of that new innovation is truly digitally enabled at its core. And together those imply that companies like P&G need to rapidly retool to keep pace, either by investing a lot in new training and toolsets, going out and hiring for those capabilities. Or else choosing to bolt on the capabilities through M&A or creative licensing, JVs, that kind of thing. What's your reaction to those observations? And do you feel like you can truly retool quickly enough on an organic basis? Or is there a case to be made that you should look outside to even a greater degree than you already have been, either in the form of hiring, acquiring new technologies, or to Jon's comments on M&A, bolting on new complementary brands altogether? Thanks. David S. Taylor - Procter & Gamble Co.: I think the answer to that is it's a both/and. And that there's no question in my mind that we can accelerate growth on our core brands. And one of the things that I want to address is at times I keep hearing…

Your next question comes from the line of Dara Mohsenian with Morgan Stanley. Dara W. Mohsenian - Morgan Stanley & Co. LLC: Hey, good morning, guys. So, Jon, first just a detail question. Can you give us a bit more clarity on how weak organic sales growth could be in Q1, given your July comments? Is a flash order (47:40) possible? And was there any timing benefit in Q4 that will come out of Q1? And then the broader question, which is also around top line. Conceptually you guys have really been pointing to fiscal 2018 as the year where you sort of get back on track form an organic sales growth standpoint. Most of the large organizational changes are in place, the SKU discontinuations drop off, you have the out-sized spending behind the Coty and Duracell share count benefit, and now also you've got the benign comparison with the abnormal external issues you cited around the world today, Jon, and the retail inventory cuts in the U.S. over this last fiscal year. So given all those factors, why do you only expect 2% to 3% organic sales growth in fiscal 2018? And does that really signal that the ultimate payoff from all these areas is unlikely to move P&G above that 2% to 3% range longer term? I guess to put it simply, are you now a structurally lower top line growth company, more in that 2% to 3% range? Jon R. Moeller - Procter & Gamble Co.: So I'll give you a point of view on the second point. But I'm sure David will have some thoughts there as well. Relative to Q1, I don't expect it – I expect growth in Q1. But that growth to be very modest, given all the dynamics that we've talked about.…

Your next question comes from the line of Wendy Nicholson with Citi Research.

Hi. Two questions. The first one on grooming if I may. With the price cut you took, your margins have come way down. And I'm just wondering specifically to the grooming business, what is going to take those margins back up over time? Because that's been such a margin accretive segment for you relative to the overall business. I'm just wondering if that's been a permanent reset? Or if there are specific things you can do outside of taking prices back up that'll make that more profitable? And then second of all, just quickly, David, on your comment about benchmarking. Clearly you benchmarked yourself relative to peers and other companies with regard to your cost structure. But have you done benchmarking with regard to your speed-to-market or time-to-market? Because when we were in China recently, we were so impressed by what we heard about the diaper launch. It looks like it's set up to be incredibly impactful, fingers crossed. But it also feels like it's taken a really long time to get to market. And listening to you talk about how much work, all the research, all that kind of stuff that you're doing, it feels like there's maybe a risk that there's sort of paralysis of analysis or something. But maybe that's an unfair characterization. So can you comment on that? Thanks. David S. Taylor - Procter & Gamble Co.: Sure, Wendy. Let me hit both of them. First, on grooming. To me the path to build the business, both in sales and profits, is to bring users back in and then to have products in each of the ladders that consumers see as better. And so they move up the ladder. The trade up model works. We've seen it over a long period of time. What we did…

And your next question comes from the line Ali Dibadj with Bernstein. Ali Dibadj - Sanford C. Bernstein & Co. LLC: Hey, guys. So I wanted to test some of your energized and eloquent prepared remarks versus some data from your results. So the first one – two things. The first one is despite you sort of under emphasizing lower price as a tool, if you look at your results on a category-by-category basis, you've decided to either take prices down, like grooming, oral care, baby, or raise prices now that you've seen some results less than your key competitors. So for a company like yours that says it's intent on growing the category, certainly in innovation, understanding it's not always premiumization, but innovation. Why that strategy? How do you think your competitors will respond? And is this a good sustainable strategy going forward? I guess the underlying question I always have is, how much are you to blame for the category slowdown? And then the second point is, to quote you, David, from your prepared remarks. If your standards are high, if you want to be the best, why is it that you set this target, and I think get paid on the target, of only performing in the top third of peers, when you have so many advantages? You're going through this great transformation. And frankly, you've historically done much better than that. You've really historically done much better than your peers. Why is that not the case now? Why this one-third? Thanks for both of those. Jon R. Moeller - Procter & Gamble Co.: Well, let me just provide some data as it relates to the first question. And then David can talk more about the approach and the thinking. If you look at price as a…

Your next question comes from the line of Lauren Lieberman with Barclays.

Thanks. Good morning. I'd like to talk a little bit about implementation of end-to-end. I think in North America we're kind of at a two-year point for that being put in place. And I understand it was the lead markets, there was going to be a lot of learning and adjusting. But it looks like you're still – share trends are still clearly not where they need to be in the U.S. So two years in, could you maybe talk a little bit about what's worked? What's been tougher than you thought? If there have been sort of impediments to seeing changed behavior and people understanding that they've got that autonomy and ability to do things differently? I think just a real time kind of status report two years in, where numerically it's not clicking, but that doesn't mean it's not the right direction to move in. Thanks. David S. Taylor - Procter & Gamble Co.: Yeah. It's a fair question. First, I'm very convinced end-to-end is a much more effective and agile operating model, because it has a very clear choice on how you're going to organize. And the G view or (1:02:48) the regional business unit that runs in North America today has line of sight and now has – and it's increasing over time, building the capability to understand the consumer, build a relationship with the customer, and building category mastery. And take North America, the U.S. and Canada. And we've had a little more challenges in the U.S. this year because of a lot of well-documented things that are going on in the marketplace. And I think if you see not only us, many other competitors, our results still are making progress. What I see – I just came from Canada yesterday. I spent a day…

Your next question comes from the line of Nik Modi with RBC Capital Markets.

Yeah. Thanks, good morning, everyone. David, thanks for providing the color you did on how P&G has enhanced the way that it evaluates new products in the pipeline. But I was hoping you can share some context on if you've made any changes on how you actually source or ideate around those products or around the innovation pipeline? So in terms of how you actually come up with the concepts, versus actually evaluating the concepts? If you can provide some context, that would be helpful. David S. Taylor - Procter & Gamble Co.: I'll just give you a couple comments, and again there's a pretty wide range by category. But we have certainly all the traditional measures. But we now are accessing many more external ideas than before in that all of the businesses in the latitude to both work with internal stake holders, but also to look at and engage where they see either technologies or even potentially other opportunities to add that are outside our company. Until something happens, we certainly wouldn't announce it. But as both I've mentioned and Jon has mention, we'll be active managers of the portfolio. And so ideas are coming both inside and outside. The ideation to me is broad. The spaces that we're innovating are more. And then the path to kind of whittle down lots of ideas to what's right for the market to me is getting faster. All those things I feel very good about. The part that I think is though absolutely important to reinforce is growing the core and building on the core is what will give us the momentum that I think we'll all be pleased with. And then adding to that. And that's why both the front-end innovation that we're doing within our categories, where we're using this lean innovation approach, which is generating a lot of ideas. Once you identify a problem, we source a lot of ideas and then can go through them much faster. But then we've added this PGV, P&G Ventures, and this additional corporate capability that's looking at new spaces that aren't in the 10 categories that are sourcing ideas, that then can be put in the category if it's adjacent or pursued independently. So we're not suffering for lack of ideas. And now the challenge is to process and then learn enough to develop models. The other thing – the last thing I'll say on this is we have several transaction learning tests going on. Some have been public, many are not, where we're trying new things as well. So again the number of both ideas and spaces, neat spaces that we're playing in is robust.

Your next question comes from the line of Olivia Tong with Bank of America Merrill Lynch.

Great. Thank you. Just getting back to the outlook. Going from 2% to 2% to 3%. It sounds like macros market growth, more or less in line with where it's been. So do you have more initiatives hitting the market? Or an expectation for a better hit rate on the plans that you have? So I guess a better understanding of the key things embedded in your expectations as you look for that acceleration. And then clearly this was a better than anticipated quarter and quite a bit better than your peers. So I guess how do you ensure consistency in growth over time so that you don't fall back into this cycle of kind of ups and downs, booms and busts, especially given all the dynamics in the market right now? There's heavier competition. There's retail pressures that you talked about. Still somewhat shaky macros in emerging markets and things like that. Thank you. David S. Taylor - Procter & Gamble Co.: A guess a couple things on why do we think we'll grow from here in shaky macros. And there's no question the environment is difficult right now. But we've got many, many pieces of evidence that when we get the innovation right, it works. One of the areas that's big enough to mention is Baby Care China. Getting that right will make an enormous difference. We had and have had several years of well below market growth on a category that's growing above 110%. And so when we launch – and certainly we'll work hard to earn share growth in that category – that's going to move several points to China and will be meaningful to the company. We've got a few other areas. When we annualize the Gillette investment, that is meaningful. On the top of…

Your next question comes from the line of Bill Chappell with SunTrust.

Thanks. Good morning. Just to follow up on the grooming. I think you'd said, David, that you did see volume growth for the first time in nine quarters. But I guess is that – was the level of growth what you were looking for? And I mean do you expect it to accelerate as we kind of move through the year? And I'm just trying to understand. So far I realize it's only two months, three months into it. Have you gotten what you thought out of this? And would you look to do anything like this to any other categories around the world? Or is this really just very, very specific? David S. Taylor - Procter & Gamble Co.: Okay, Bill, let me just give a couple quick comments. And I'll try to address that last one, which is much broader. The answer to, did we get what we expected in AMJ [April/May/June] in the U.S.? The answer is yes. The volume response was as we modeled, maybe a little bit better actually. But it's early. And so I'm not going to for a second declare victory. We don't even have the full plan in the market. We had part of it executed, certainly the price change at some of our major customers did drop. But there's additional actions that will take place over this six months to go ahead and get the rest of the plan in the market, the portfolio right, the packaging right, and the go-to-market programs. We couldn't affect all of that immediately. The one we could do quickest is the price change to address some of the points on the ladder that were missing. So we're in early stages of a very important investment in a very important category. And I can't predict what'll…

Your next question comes from the line of Andrea Teixeira with JPMorgan.

Hi. Good morning. Thank you. So given your strong performance in the first quarter, how are you thinking about retailers' willingness to build inventory levels again? Do think the large destocking that you've seen through fiscal 2017 is largely behind you at this point? And then if you – in your organic growth guidance you mentioned the back end loaded given the tough comp in the first quarter. Is that primarily because you were seeing the international trends getting better? Or the comp being tougher in the first quarter? So if you can break down EM and DM embedded in your guidance. And related to that in terms of your spending to grow. In terms of thinking – as embedded in your guidance also for fiscal year 2018, it's pretty conservative in my view in terms of how you're going to spend – you're going to have the trade spend funded into more rational add spend. So what you saw here in the fourth quarter was like you cut and then quoted as temporary. So can you help us bridge this guidance in terms of SG&A spend as well? Thank you so much. Jon R. Moeller - Procter & Gamble Co.: Sure. First of all in terms of retail inventories, I mean we're working hard with our retail partners to ensure availability on shelf. Within that we're very supportive of lower inventories systemically across the value chain. And a number of our product supply initiatives are designed to enable both ourselves and our retail partners to carry lower inventories. So we're not expecting a big acceleration in inventories that retailers are currently holding. But we're going to continue to work on availability at shelf. Some of our supply initiatives have enabled us to increase that significantly. In North America as…

The next question comes from the line of Bonnie Herzog with Wells Fargo.

Good morning. You guys mentioned some interest in M&A this morning. But this would really be the first time in years that you've purchased something, since you've really been in selling and consolidating mode. So I'd love it if you could drill down a little further on why now? And then why you would only look to acquire – or would you only look to acquire something in your existing categories? Or would you be willing to expand into another category? And then maybe finally, if you could just remind us of your criteria for acquisitions, that would be helpful. Thanks. David S. Taylor - Procter & Gamble Co.: Why don't I give a comment or two, and then Jon will add a comment. First, we went through – you're absolutely right. We went through a very big process the last several years going from almost 200 brands down to 65. But what we said, and we really mean it, is when we closed on October 1 the Coty deal, all 10 categories needed to be in a position to grow. They needed to deliver results and grow. And it starts with very strong organic growth, building from the base. And I think we've got really good evidence that that is possible when you see the top 10 brands driving your growth and growing above the market, which is good evidence that we're starting to see our innovation programs working. On top of that, I think it makes perfect sense, and we've made the decision to say we'll be active managers. So all 10 of the presidents, as well as the company looking at spaces outside the 10 core categories that we're active. Now we won't do anything until we see something that we think can create value and leverages…

Your next question comes from the line of Jason English with Goldman Sachs. Jason English - Goldman Sachs & Co.: Hey, guys. Good morning. Thank you for squeezing me in. I've got two questions. And I'm just going to kind of spew them out, because I know I don't get a second chance. First, I wanted to understand guidance and the implicit reinvestment into next year. I think you said around 5% to 7% bottom line, 2 points is share repo, getting us to a sort of 3% to 5% pre-tax on 3% growth. That doesn't imply much margin especially in context of I think you said, commodities post-tax only $200 million. That's kind of benign for a company your size. So is it right to assume that this implies a lot of reinvestment in productivity? If so, kind of what shape, what form, and where? If you can elaborate on that. And secondly, on business units you're right. The focus for a long time on underperformance has been sort of beauty and grooming. But looking at baby, fem, and family, growth has been quite sluggish for a couple years, pre-tax profit down. And obviously we're fresh off of Kimberly results yesterday. Both of you really seem to be struggling. What does that say about the environment for those businesses, baby, tissue products, et cetera, both in the near term and over the medium to long term? Thank you. Jon R. Moeller - Procter & Gamble Co.: Jason, I'll take the first one of those. As I said in my prepared remarks, we're expecting to increase operating profit growth from 2% this year to 5% to 6% next year. And in terms of all the pieces and the builds, I'd encourage you to work with John [Chevalier] through the course…

Your next question comes from the line of Kevin Grundy with Jefferies.

Thanks, good morning, guys. David S. Taylor - Procter & Gamble Co.: Morning, Kevin.

David, I wanted to come back to your online strategy. So within the context, there's considerable worry I would say in the market about narrowing of competitive moats, as consumers migrate online where the barriers to entry are lower. You have Amazon, which has expressed an appetite and is investing behind its own private label brands. So and then we've also talked about some worry about commoditization of product categories with some of the trade spending that's going on, et cetera. So as you consider these factors and then naturally the fact that online will become a bigger portion of everyone's channel mix, I have three questions. Opportunities and risks, the larger ones as you see it would be number one. Number two, do you see any further opportunities to expand upon direct-to-consumer capabilities, maybe beyond just outside of blades? And then the third piece, sort of notwithstanding blades, where your market share is naturally going to be lower, given the success of Harry's and Dollar Shave Club. Maybe you could talk a little bit about market share positioning and trends as you see them relative to what we can observe in brick and mortar? Thank you. David S. Taylor - Procter & Gamble Co.: Very good. All good questions, a couple comments. One, just a broad comment about it – about this space. Because I've got it many, many times saying, the low barrier to entry and the number of brands that come at you presents a big threat to P&G and P&G's great brands. And we've talked often about endless shelf. If anything, online consumers look at less brands than more brands. Walk a store at a big mass merchandiser, and some big categories like hair care you may say, 30, 40, 50 brands. When you go to…

And your final question comes from the line of Faiza Alwy with Deutsche Bank.

Yes, hi. Good morning. So I just wanted to expand a little bit more on your comment regarding digital marketing. It feels like you're rethinking what marketing really means and how to communicate with consumers, especially with the new generation of millennial consumers. So could you – like is that right? And it feels like overall the way we think about marketing as advertising is potentially going to be down this year? So could you confirm that? And just elaborate a little bit more about how you think – what is the best way to communicate with consumers? Jon R. Moeller - Procter & Gamble Co.: Yeah. David S. Taylor - Procter & Gamble Co.: A couple comments. Certainly we are and have been rethinking marketing in that it will evolve. But I think the key is building the relationship with the consumer and communicating the full range of benefits of your brand in a way that makes a difference to the consumer. How we do that has changed. What we're trying to do I don't think has changed a lot. We now use a variety of different channels. And certainly social medial has exploded in its importance. There will be those that talk about not only the zero, first, and second moment of truth, but even after the in-home usage experience, now there's another moment you have to worry about, which is what consumers say about you in social media on Instagram or Facebook or any variety of different vehicles. And I think that's true, which is all the more reason why you both have to have a superior product, but also communicate it in a way. And the brand has to stand for something. It's one of the reasons why I believe campaigns like the Like a Girl,…

Ladies and gentlemen, that concludes today's conference. Thank you for your participation. You may now disconnect. Have a great day.