July 18, 2006

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www.bernstein.com
July 18, 2006
The Case for Global
Marilyn Fedak Head of Bernstein Global Business
andCo-CIO US Value Equities
This presentation has been provided for use in a
private and confidential meeting to discuss a
potential or existing investment-advisory
relationship. This presentation is not an
advertisement and is not intended for public use
or distribution beyond such a private meeting.
Bernstein does not provide tax, legal, or
accounting advice. In considering this material,
you should discuss your individual circumstances
with professionals in those areas, as
appropriate, before making any decisions.
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Our Firm's Mission

• To have more knowledge and use knowledge better
  than any investment firm in the world
• To use and share knowledge to help our clients
  achieve investment success and peace of mind
• To place our clients interests first and foremost

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Seeing the World in a Different Way
Source NASA
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The Next Step in Investing
One World Portfolio Focusing onHighest-Return
Opportunities Globally
354 Analysts
Global Value
15 Industries
37 Countries
18 Currencies
2,700 Companies
Global Growth
200275 Stocks
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The PG Plan

• Develop new products for developing markets
• Search externally for innovation
• Build global brands

Source Company reports and Bernstein analysis
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PG Increased International Sales
Total Sales( Billions)
CAGR
20
Rest of World
North America
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Source Company reports and Bernstein analysis
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PG Increased International Sales
Total Sales( Billions)
Developing Markets Sales
13 Bil.
CAGR 18
CAGR
20
8 Bil.
Rest of World
North America
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Source Company reports and Bernstein analysis
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PG Has Taken Advantage of Outside Innovation
Source Company reports and Bernstein analysis
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PG Has Taken Advantage of Outside Innovation
The Swiffer Mop ProfitablePartner Innovation
Source Company reports and Bernstein analysis
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1 Billion Global Brands
Source Company reports and Bernstein analysis
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PG Has Strong U.S. Competitors
Source Company reports and Bernstein analysis
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As Well as Strong Global Competitors
Source Company reports and Bernstein analysis
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Airbus A Global Aircraft
Source Company reports and Bernstein analysis
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Taiwan Semiconductor Global Supplier of Chips
Source Company reports and Bernstein analysis
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Impact on Sources of Risk and Return
Country Less Important Source of Return
()
Country
Industry
Company
()
()
Valuation Attribution of World Index
Rolling one year through June 30, 2005Based on
cap-weighted MSCI World Index with returns hedged
in US isolates company, country and industry
factors as a percent of the total for just those
factors. The MSCI World Index is a free
float-adjusted market capitalization index that
is designed to measure global developed market
equity performance. An investor cannot invest
directly in an index or average and they do not
include sales charges or operating expenses
associated with an investment in a mutual fund,
which would reduce total returns. Past
performance does not guarantee future
results.Source MSCI and AllianceBernstein
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The Universe of Opportunity
Share of Industry
()
Based on market capitalization. MSCI All Country
World Index as of September 30, 2005Source
MSCI, Standard Poors, and Bernstein
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The Home of Attractive Stocks Varies over Time
Geographic Distribution of Most Attractive Stocks
()
Non-U.S.
U.S.
As identified by Bernsteins proprietary global
stock selection model (Global Edge Model), 100
most attractive candidates for global value
portfolios
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Risk Profile Is Similar
Volatility July 1996June 2006
Volatility measured as the annualized standard
deviation of monthly returns. Source MSCI and
Standard Poors
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What You Need to Be a Truly Global Investor

• Integrated, global fundamental research
• Sophisticated quantitative techniques

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Does the "Bernstein Hallmark Quality Research"
Work?
EXAMPLE Electric Utilities
Extensive Field Research

• Industry Analysis
• Plant capacity
• Fuel pricing
• Cost of new investment
• Demand growth
• Regional factors

• Company Analysis
• Key assets
• Access to fuels
• Contractual relationships
• Regulatory environment
• Plant optimization

Detailed Five-Year Financial Model

• Detailed segment and product-line analysis
• Five-year forecasts of earnings power, cash
  flowand balance sheet strength

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Our TeamSelected Analyst Backgrounds
Years of Professional Experience
Analyst
Sector
Experience
Education
Location
Atsushi Horikawa Finance Sakura Bank BA,
University of Tokyo Tokyo 17 MBA, Harvard Cem
Inal Technology FusionOne McKinsey BSE,
Princeton New York 13 Mitsubishi Electric MBA,
Cornell Akhil Kapoor Chemicals Honeywell Corp
McKinsey B. Tech, IIT, Delhi New
York 16 Chem-Etrade BOC Gases PhD, State
University of NY,

Buffalo MBA, University of Chicago Jerry
Maris Capital Equipment Textron Booz Allen BA,
Duke New York 20 and Defense MBA,
Stanford David Nelson Utilities Boston Consulting
Group BSc, University of California, London 20 A
rthur D. Little Putnam, Berkeley MBA,
Wharton Hayes, and Bartlett Steve
Warner Media Lifetime TV CBS BA, Yale MBA,
Harvard New York 24
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Our Analysts Are Organized by Global Industry...
Jim Gerber Director of Global Value Research
Utilities Taro Hirano Glenn McIsaac David Nelson
Finance Rich Cetlin Atsushi Horikawa Matthew
Kennedy Samir Parekh Philippos Philippides Wim
Steemers Anu Venkataraman
Consumer Cyclicals Avinash Agarwal Tawhid
Ali Gokhan Ates Rajeev Eyunni Bruno
Grandsard Yogi Kak Daisuke Kameyama Erik
Turenchalk Steve Warner
Industrial Commodities Al Caesar Michelle
Dunstan Daniel Grasman Prasad Inampudi Takeshi
Ishiga Akhil Kapoor Yuri Serov Jeffrey Smith
REITs Prashant Tewari Diane Won
Consumer Staples Mark Harrison Anish
Tawakley Mark Underwood
Energy Vlad Byalik Matt Crossland Ted Davis
Telecommunications Peter Frith Vinod Nair
Technology/Electronics Andrey Belov Josh
Duhl Tony Evans Andy Hong Cem Inal Eric Yu
Capital Equipment, Defense and
Transportation Aiko Hemmi Jerry Maris Craig
Schorr Jeremy Taylor Andrew Weiner
Medical Valerie Brown Steve Findley Kayoko Ohara
As of June 2006
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...and Are Located Around the World
London
Tokyo
New York
Hong Kong
Sydney
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Our Analysts Cover Global Industries
Example Auto Coverage
OEM Analyst
DOR Emerging Markets
DOR Canada
DOR US
DOR Global
DOR Australia
DOR Europe
DOR Japan
Original Equipment Manufacturer Director of
Research
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Global Coverage Requires Intensive Management
Example Auto Coverage
Director of Global Value Research
OEM Analyst
Suppliers and Parts Analyst
DOR Emerging Markets
DOR Canada
DOR US
DOR Global
DOR Australia
DOR Europe
DOR Japan
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A Truly Global Organization Provides Superior
Research

• Global research provides exceptional insights
  into companies that compete in global markets
• Global structure ensures consistency of
• Research quality in every location
• Industrial viewpoints across all of our
  investment services
• Bernstein culture around the globe

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Quantitative Research Global Scope with Local
Insights
Portfolio ManagementAndrew Chin
Fuminori Asaki Frank Chen Paula Dawson Kent
Hargis Kingsley Jones Chung Ma Anatoly
Mylnikov Domingos Romualdo Andy Wang Nelson Yu
London
Tokyo
New York
Product DevelopmentMark Gordon
Peg DiOrio Ilya Figelman David Larson Steven
Lin Jun Ren Alex Shabshis Leon Zhu
Sydney
As of March 2006
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Our Team Selected Analyst Backgrounds
Years of Professional Experience
Years at Bernstein
Previous Experience
Analyst
Education
Location
Paula Dawson HSBC MA, University of Cambridge
London 10 MSc,
University of Oxford Kent Hargis Goldman Sachs
PhD, University of Illinois New
York 11 BA, St. Louis
University Kingsley Jones CSFB PhD,
University of Bristol Australia
9 BSc Hons, ANU-Australia David
Larson Morgan Stanley MS and PhD, Stanford
University New York 19
BS, Yale University Nelson Yu Grant Thornton BS
and BSE, University of Pennsylvania
New York 13
5 3 3 11 9

• Rigorous theoretical foundation
• Combined with capital markets experience and
  tenure
• Lead to well-grounded perspectives

As of March 2006
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Long History of Innovation
Quantitative Research Initiatives
1980
1990
1995
2000
2006
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Conclusions

• The vision of a global economy is becoming a
  reality
• The global economy is changing how companies do
  business
• And how we make investment decisions
• Global portfolios are a strategic imperative that
  we will offer to all clients

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