1st Quarter Results

RNS Number:7490U
Colgate-Palmolive Co
18 April 2002

Bina Thompson 212-310-3072

Hope Borkenstein 212-310-2291

FOR IMMEDIATE RELEASE...

Colgate Announces Strong 1st Quarter Results

Gross Profit Increased 140 Basis Points to Record Level

E.P.S. up 11% to $.49 vs. $.44

NEW YORK, NEW YORK, April 18, 2002... Colgate-Palmolive Company (NYSE:CL) today
reported its 24th consecutive quarter of increased earnings per share, increased
net income and increased gross profit margin. Gross profit margin grew 140 basis
points, above the top end of the Company's target range. Gross profit reached a
record 54.8% with every operating division showing gains. Global unit volume
grew 2.5% in the quarter on top of extremely strong volume growth in the year
ago period. Operating profit margin also increased in every division while
global net profit margin increased to a record 13.2%. Sales declined 0.5% due to
exchange while dollar operating profit as reported increased 4%. Excluding
foreign exchange, worldwide sales rose 3% and operating profit increased 8%.

Net income increased 8% to $289.7 million and earnings per share rose 11% to
$.49 versus $.44 in the first quarter 2001. First quarter 2002 results reflect
the Company's adoption of SFAS 142 effective January 1, 2002 which eliminates
the amortization of goodwill. As announced in the Company's last quarterly
earnings release webcast, the non-cash benefit of $.01 per share in the quarter
from the goodwill elimination was offset by an increase in non-cash pension and
benefit expenses.

Reuben Mark, Colgate's Chairman and CEO said, "We are pleased to start the year
achieving our profit target, despite very difficult economic conditions in many
locations around the world. Record gross profit margin across all operating
divisions bodes well for the rest of this year and beyond. The 140 basis point
jump in gross profit margin is the largest improvement in over two years. This
positive momentum combined with the completion of SAP implementation in Latin
America this year give us encouragement that we are on track to achieve our
long-term gross margin goal of 60% by the end of 2008 or sooner, while reaching
shorter-term gross profit targets as well.

"Increased total marketing support behind our global brands in the quarter
helped drive market share gains and worldwide volume increases while again
delivering strong earnings per share growth.

"Our already strong balance sheet, as reflected by our rating upgrade last year,
became even stronger with interest coverage ratios continuing to increase.
Aftertax return on capital set a new all-time record at 30.9%, up more than 300
basis points versus the year ago period.

"Looking ahead to the balance of the year we are encouraged by our full new
product pipeline. In addition, our ability to generate funds to support global
new product launches appears to be accelerating. Volume is expected to grow
progressively as we move through the year, and an excellent level of
profitability should be maintained. Accordingly, we expect earnings per share
results for the full year to be in line with expectations."

At 11:00 a.m. EST today, Colgate will host a conference call to further
elaborate on first quarter results and to discuss the Company's ongoing
expectations. To access this call as a webcast, please go to Colgate's web site
on the Internet at www.colgate-palmolive.com.

The following are comments about divisional performance:

Colgate-North America (26% of Company Sales)

Positive growth momentum continued in North America fueled by new product sales
and market share gains. Unit volume and dollar sales grew 3.0% and 3.5%,
respectively, against a very strong performance in the first quarter 2001.
Colgate's consumer takeaway exceeded Company shipments as the level of trade
inventories again decreased nationwide. Operating profit increased 13% and is
unaffected by the combination of the goodwill and benefit changes.

In the U.S., Colgate's leadership of the toothpaste market continues with a
national ACNielsen market share of 35.5% for the quarter, maintaining the
all-time high market share achieved in the year ago period. Innovative new
products gaining share across categories are Colgate Total Plus Whitening and
Colgate Fresh Confidence toothpastes, Colgate 2in1 toothpaste and mouthwash,
Colgate Motion battery-powered toothbrush, Colgate Active Angle toothbrush, Lady
Speed Stick Invisible Dry and Speed Stick Power of Nature deodorants, Softsoap
Vitamins with vitamin E body wash and Suavitel Fresca Primavera fabric
conditioner.

Maintaining the fast new product launch pace in the U.S., more recent
introductions arriving on store shelves now include Softsoap Naturals
moisturizing body wash, Ajax Spring Blossom dishwashing liquid and new Palmolive
Super Scrub Gel Paste dish and pot scrub with special abrasives for
tough-to-clean items. The new product pipeline remains strong for the balance of
this year.

Colgate-Europe (20% of Company Sales)

European unit volume rose 4.0% as innovative new products drove top-line
increases in nearly every country. The United Kingdom, Nordic, Greece, Portugal,
Belgium, Russia, Turkiye and Poland were among the strongest performers. Local
currency sales and operating profit increased 3% and 16%, respectively (local
currency operating profit increased 13% excluding the goodwill accounting
change). Dollar sales for the region decreased 1.0% due to the weak Euro while
reported dollar operating profit increased 12% versus the first quarter 2001.

In Oral Care, successful new entrants gaining market share throughout the region
include Colgate Herbal and Colgate Total Plus Whitening toothpastes, Colgate
Motion battery-powered toothbrush and Colgate Zig Zag manual toothbrush.
Palmolive Aromatherapy shower gel and bath foam, Ajax glass and all purpose
cleaner wipes and Soupline Lily of the Valley fabric conditioner were standouts
in other categories.

New products driving growth throughout Central Europe and Russia include Colgate
Total Plus Whitening and Colgate Herbal White toothpastes, Palmolive Fruit
Essentials translucent bar soap, Palmolive Aromatherapy shower gel and bath foam
and Ajax Floral Fiesta powder scourer.

Colgate-Latin America (24% of Company Sales)

Volume gains in Central America, Colombia, the Dominican Republic, Ecuador and
Peru were offset by expected volume declines in Brazil when compared against the
very strong double-digit volume growth in that country in the year ago period.
The Latin American volume decline of 1.0% also reflects the economic crisis in
Argentina versus the year ago quarter. In local currency, continuing sales rose
1% and operating profit increased 5% (local currency operating profit increased
2% excluding the goodwill accounting change). Due to the stronger dollar,
continuing sales for the Division declined 5.0% and reported operating profit
was flat versus first quarter 2001.

Colgate continues to strengthen its Oral Care leadership in the region. New
products contributing to gains include Colgate Triple Action toothpaste, Colgate
Active Flexible and Colgate Premier Ultra toothbrushes, and most recently
Colgate Fresh Confidence Extreme Red gel and Colgate Herbal White toothpastes.
Fueling growth in Personal Care are Mennen Speed Stick Power of Nature
deodorants and a new line of Palmolive Caprice specialty variants of shampoo.
Fabuloso Lavender liquid cleaner and Axion Apple Fantasy dishwashing paste were
standouts in Household Surface Care.

Colgate-Asia/Africa (17% of Company Sales)

Unit volume grew 3.5% in Asia/Africa led by strong growth in Australia, New
Zealand, Fiji, Hong Kong, Malaysia, Vietnam and South Africa. This growth is on
top of double-digit volume growth in the first quarter 2001. Excluding foreign
exchange, sales rose 2% and operating profit increased 4% (local currency
operating profit increased 3% excluding the goodwill accounting change). Due to
currency translation, reported sales declined 3.0% and operating profit
decreased 1%.

Successful new entrants driving growth in Oral Care include Colgate Herbal,
Colgate Herbal White and Colgate Triple Action toothpastes. In China, for
example, Colgate's national toothpaste market share as measured by ACNielsen
rose almost three full share points versus first quarter 2001 to 28.9%. Protex
Herbal soap and talc, Palmolive Fresh soap and Softlan fabric conditioner
contributed to gains in other categories throughout Asia.

Strong growth in the South Pacific region was led by gains from Colgate Fresh
Confidence and Colgate Total Plus Whitening toothpastes, and Colgate Active
Flexible toothbrush.

Hill's Pet Nutrition (13% of Company Sales)

The world leader in specialty pet food, Hill's increased unit volume and sales
by 4.0% and 2.5%, respectively. Technology-based new products, veterinary
endorsements and targeted promotional activities contributed to growth in North
America and internationally. Excluding foreign exchange, sales increased 5% and
operating profit increased 11%. Dollar operating profit increased 5% versus the
year ago period.

Hill's increased consumption of Science Diet in the U.S. specialty retail
channel, where its growth continues to outpace category growth, and increased
sales of Prescription Diet in the veterinary channel. Strong domestic results
include the success of recently launched Science Diet Oral Care for cats and
dogs, and Prescription Diet b/d, a diet clinically proven to reduce the signs of
brain aging in dogs.

Australia, Hong Kong, Spain, Denmark, New Zealand, Taiwan and South Korea led
Hill's international volume growth. During the quarter, Hill's gained leadership
of the dry cat food market in Japan and introduced Science Diet Oral Care and
Prescription Diet b/d throughout Europe and Asia.

* * *

About Colgate-Palmolive: Colgate-Palmolive is a leading global consumer products
company, tightly focused on Oral Care, Personal Care, Household Surface Care,
Fabric Care and Pet Nutrition. Colgate sells its products in over 200 countries
and territories around the world under such internationally recognized brand
names as Colgate, Palmolive, Mennen, Softsoap, Irish Spring, Protex, Sorriso,
Kolynos, Ajax, Axion, Soupline, Suavitel and Fab, as well as Hill's Science Diet
and Hill's Prescription Diet pet foods. For more information about Colgate's
global business, visit the Company's web site on the Internet at
www.colgate-palmolive.com.

This press release (other than historical information) contains forward-looking
statements. Actual events or results may differ materially from those
statements. Investors should consult the Company's filings with the Securities
and Exchange Commission (including the Company's Form 10-K for the year ended
December 31, 2001 under the caption "Cautionary Statement on Forward-Looking
Statements") for information about factors that could cause such differences.
Copies of these filings may be obtained upon request from the Company's Investor
Relations Department.

(See attached table for first quarter results.)

The full text of Colgate releases is available:

Internet Address: http://www.colgatepalmolive.com

Shareholder Direct: 1-800-850-2654

E-mail: Investor_Relations@Colpal.com

Colgate-Palmolive Company Summary of Consolidated Results

For the three months ended March 31, 2002 and 2001

(Dollars in Millions Except Per Share Amounts) (Unaudited)

2002 2001
Net Sales $2,195.2 $2,212.2
Cost of Sales 992.4 1,031.8
Gross Profit 1,202.8 1,180.4
Gross Profit Margin 54.8% 53.4%
Selling, General & Administrative Expenses 742.1 738.9
Earnings before Interest & Taxes (EBIT) 460.7 441.5
Operating Profit Margin 21.0% 20.0%
Net Interest Expense 34.9 43.6
Income Before Income Taxes 425.8 397.9
Provision for Income Taxes 136.1 130.0
Tax Rate 32.0% 32.7%
Net Income 289.7 267.9
Net Earnings Per Common Share
Basic $.52 $.47
Diluted $.49 $.44
Average Common Shares Outstanding
Basic 549.2 564.6
Diluted 597.2 615.5

SFAS 142, which was adopted on January 1, 2002, resulted in the
discontinuance of amortization of goodwill and indefinite life
intangible assets. If year 2001 had been restated for the impact of SFAS
142, EBIT, net income and diluted earnings per share would have been
$455.5, $279.1 and $.45, respectively.

This information is provided by RNS
The company news service from the London Stock Exchange

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