What's in Store for the P&G Annual Meeting?

What's in Store for the P&G Annual Meeting?

Consumer staples giant Procter & Gamble has fallen on hard times recently, with declining sales of core brands and massive layoffs last year . Former CEO A.G. Lafley was brought back on after a four-year hiatus to right the ship...but how can he do that?

We'll probably get a glimpse today as Lafley gives the keynote address at P&G's Annual Meeting, his first since returning to the P&G helm. What should we expect?

Focus on the core
In the company's 2013 Annual Report, Lafley expresses pride in "beginning to restore growth in the core U.S. market" and continuing "to focus on our core businesses."

Therefore I expect to hear less focus on emerging markets and overseas performance than on North American operations, and I also expect to hear a lot about core brands like Pampers and Pantene.

The turning of the Tide
Look especially for the Tide brand to be front and center. Tide Pods are one of the company's biggest success stories since their 2012 debut (and, thankfully, the Minnesota toddler who made headlines by swallowing one has now left the ICU) .

In addition to the recently announced cheaper version of Tide (called "Tide Simply Clean & Fresh"), P&G will soon be rolling out a new line of larger Tide pods, a new line of "Tide Plus" liquid detergents, and a new product called Tide Ultra Stain Release, which can be used as a pre-treater as well as a detergent.

Most of P&G's detergent lineup (which also includes Cheer, Bold, Era, and Gain) are considered "premium," but an entry into the mid-tier market seems likely to take market share from lower-priced brands like Church & Dwight's Arm & Hammer and Xtra, and Henkel AG's Purex. In 2012, Church & Dwight's brands snared just over 15% of overall U.S. market share, while Henkel's Purex only had 5%. Both were dwarfed by Tide's 30%, but clearly there's room for Tide to expand.

Interestingly, Henkel's stock has outperformed the S&P 500 by about 6 percentage points over the past year, almost exactly the same amount as both P&G's and Church & Dwight's stocks have underperformed. But that could change if Tide Simply Clean & Fresh takes off.

Less focus on affordability
P&G has actually seen quite a bit of success from bargain versions of its popular premium brands like Bounty Basic paper towels and Charmin Basic toilet paper, both introduced in 2005 under Lafley's previous tenure. The "Basic" lines now make up 15% of overall sales of Bounty and Charmin, and have higher profit margins than their premium counterparts to boot.

Interestingly, though, this hasn't seemed to bother chief rival Kimberly-Clark , maker of Scott paper towels and Cottonelle, whose stock price has risen 25% higher than P&G's since the Basic lines debuted.This despite the fact that P&G dominates the U.S. paper towel market, with 44% of market share in 2012. Kimberly-Clark had a distant 10%. In the toilet paper category, though, the companies' shares are much closer, with just under 28% of U.S. market share for P&G and just under 25% for Kimberly-Clark (privately held Georgia-Pacific actually leads both--barely--with 30% of market share).

In any case, analysts from Barclays and SunTrust Bank downgraded P&G stock on the news of Tide Simply Clean & Fresh last month , so I expect Lafley to gloss over P&G's "bargain" lines.

That's not a layoff: it's an "operational efficiency"
Talking about layoffs at an annual meeting seems a bit gauche. Yes, there have been layoffs-about 5,000 of them in the past year - and the company indicated in August that there would be more to come. But look for these to be referenced in oblique ways, like "streamlining operations" and "improving business performance." The move to combine P&G's many businesses into four "industry-based sectors" will likely be a key step in this effort.

Sounds pretty dull
Yes, it does, doesn't it? But with a massive conglomerate like P&G, that's probably a good thing. The last thing the market wants from a reliable dividend aristocrat (56 years and counting!) is a "shakeup." And clearly the market isn't expecting one, with the stock trading in a tight range of $75.00 to $76.50 over the last week.

For better or for worse, Lafley's a known quantity, having led this consumer products giant for almost a decade in the early 2000s, and he's only a few months into his tenure this time around. Given all that, expect the expected at today's meeting.

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The article What's in Store for the P&G Annual Meeting? originally appeared on Fool.com.

John Bromels owns shares of Procter & Gamble. The Motley Fool recommends Kimberly-Clark and Procter & Gamble. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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