Colgate-Palmolive Company (NYSE:CL):
- Net sales increased 10.5%; Organic sales* increased 9.0% with
growth in five out of six divisions and in all four categories
- GAAP EPS and Base Business EPS* both increased 16% to
$0.86
- GAAP Gross profit margin increased 130 basis points to
58.5%
- Base Business Gross profit margin* increased 140 basis points
to 58.6%, up 190 basis points excluding a negative 50 basis point
impact from private label sales resulting from the previously
disclosed acquisitions of pet food businesses
- Net cash provided by operations was $2,609 million for the
first nine months of 2023 up 39% versus 2022
- Colgate’s leadership in toothpaste continued with its global
market share at 41.0% year to date
- Colgate’s leadership in manual toothbrushes continued with its
global market share at 31.5% year to date
- The Company raised its financial guidance for full year
2023
Third Quarter Total Company Results
(GAAP)
($ in millions except per share
amounts)
2023
2022
Change
Net Sales
$4,915
$4,455
+10.5%
EPS (diluted)
$0.86
$0.74
+16%
Third Quarter Total Company Results
(Base Business - Non-GAAP)*
2023
2022
Change
Organic Sales Growth
+9.0%
Base Business EPS (diluted)
$0.86
$0.74
+16%
*Indicates a non-GAAP financial measure.
Please refer to “Non-GAAP Financial Measures” later in this release
for definitions of non-GAAP financial measures and to “Table 6 -
Geographic Sales Analysis Percentage Changes” and “Table 8 -
Non-GAAP Reconciliations” included with this release for a
reconciliation of these non-GAAP financial measures to the related
GAAP measures.
Colgate-Palmolive Company (NYSE:CL) today reported results for
third quarter 2023. Noel Wallace, Chairman, President and Chief
Executive Officer, commented on the Base Business third quarter
results, “We are very pleased to have delivered another quarter of
strong top and bottom line growth. Net sales increased 10.5% and
organic sales grew 9.0% with volume improving sequentially versus
second quarter 2023. Gross profit margin, operating profit margin,
operating profit, net income, earnings per share and free cash flow
all increased versus the year ago quarter.
“We are particularly pleased with the quality of our results
this quarter on top of our strong first half results. This was our
third quarter of sequential improvement in gross profit margin and
our second quarter in a row delivering double-digit operating
profit growth along with a double-digit increase in advertising
spending. Strong investment levels behind brand-building activities
and innovation should continue in the remainder of the year as we
continue to work towards balanced organic sales growth.
“The momentum in our business and the strength of our profit and
cash flow performance adds to our confidence that we are executing
the right strategies to deliver on our raised 2023 financial
targets and generate long-term value for our stakeholders.”
Full Year 2023 Guidance
Based on current spot rates:
- The Company now expects net sales growth to be 6% to 8% (versus
5% to 8% previously), including the benefit from our acquisitions
of pet food businesses and a low-single-digit negative impact from
foreign exchange.
- The Company increased its organic sales growth guidance to 7%
to 8% (versus 5% to 7% previously).
- On a GAAP basis, the Company still expects gross profit margin
expansion, increased advertising investment and double-digit
earnings-per-share growth.
- On a non-GAAP (Base Business) basis, the Company still expects
gross profit margin expansion and increased advertising investment
and increased its earnings-per-share growth guidance to high-single
digits.
Divisional Performance
The following are comments about divisional performance for
third quarter 2023 versus the year ago period. See attached "Table
6 - Geographic Sales Analysis Percentage Changes" and "Table 5 -
Segment Information" for additional information on net sales and
operating profit by division.
Third Quarter Sales Growth By
Division
(% change 3Q 2023 vs. 3Q 2022)
Net Sales
Organic Sales*
As Reported Volume**
Organic Volume
Pricing
FX
North America
+3.5%
+3.5%
-4.0%
-4.0%
+7.5%
—%
Latin America
+20.0%
+15.0%
+5.5%
+5.5%
+9.5%
+5.0%
Europe
+14.5%
+7.0%
-4.0%
-4.0%
+11.0%
+7.5%
Asia Pacific
-4.0%
-1.5%
-7.0%
-7.0%
+5.5%
-2.5%
Africa/Eurasia
-7.5%
+15.5%
+4.0%
+4.0%
+11.5%
-23.0%
Hill's
+21.5%
+15.0%
+9.0%
+3.0%
+12.0%
+0.5%
Total Company
+10.5%
+9.0%
+0.5%
-0.5%
+9.5%
+0.5%
*Indicates a non-GAAP financial measure.
Please refer to “Non-GAAP Financial Measures” later in this release
for definitions of non-GAAP financial measures and to “Table 6 -
Geographic Sales Analysis Percentage Changes” included with this
release for a reconciliation of these non-GAAP financial measures
to the related GAAP measures.
**The impact of the previously disclosed
acquisitions of pet food businesses on as reported volume was 6.0%
and 1.0% for Hill's and Total Company, respectively.
Third Quarter Operating Profit By
Division
($ in millions)
3Q 2023
% Change vs 3Q 2022
% to Net Sales
Change in basis points vs 3Q 2022
% to Net Sales
North America
$231
17%
23.3%
+260
Latin America
$372
29%
31.2%
+220
Europe
$162
28%
22.3%
+220
Asia Pacific
$193
4%
28.3%
+220
Africa/Eurasia
$66
—%
24.8%
+180
Hill's
$201
—%
19.0%
-410
Total Company, As Reported
$1,029
9%
20.9%
-40
Total Company, Base Business*
$1,031
12%
21.0%
+30
*Indicates a non-GAAP financial measure.
Please refer to “Non-GAAP Financial Measures” later in this release
for definitions of non-GAAP financial measures and to “Table 8 -
Non-GAAP Reconciliations” included with this release for a
reconciliation of these non-GAAP financial measures to the related
GAAP measures.
North America (20% of Company
Sales)
- Organic sales growth was led by oral care and personal
care.
- In the United States, Colgate's share of the toothpaste market
is 33.7% year to date and its share of the manual toothbrush market
is 40.9% year to date.
- The increase in Operating profit as a percentage of Net sales
was primarily due to higher pricing and cost savings from the
Company’s funding-the-growth initiatives, partially offset by
significantly higher raw and packaging material costs.
Latin America (24% of Company
Sales)
- Organic sales growth was led by Argentina, Mexico, Brazil and
Colombia.
- The increase in Operating profit as a percentage of Net sales
was primarily due to higher pricing, cost savings from the
Company’s funding-the-growth initiatives and lower overhead
expenses, partially offset by higher raw and packaging material
costs, a value-added tax refund in the third quarter of 2022 and
increased advertising investment.
Europe (15% of Company
Sales)
- Organic sales growth was led by Germany and the United
Kingdom.
- The increase in Operating profit as a percentage of Net sales
was primarily due to higher pricing, cost savings from the
Company’s funding-the-growth initiatives, favorable mix and lower
amortization expenses, partially offset by significantly higher raw
and packaging material costs and increased advertising
investment.
Asia Pacific (14% of Company
Sales)
- Organic sales declines in the Greater China region were
partially offset by organic sales growth in India and the
Philippines.
- The increase in Operating profit as a percentage of Net sales
was primarily due to cost savings from the Company's
funding-the-growth initiatives and higher pricing, partially offset
by significantly higher raw and packaging material costs.
Africa/Eurasia (5% of Company
Sales)
- Organic sales growth was led by Türkiye, the Eurasia region,
Nigeria and South Africa.
- The increase in Operating profit as a percentage of Net sales
was primarily due to cost savings from the Company’s
funding-the-growth initiatives, higher pricing and lower overhead
expenses, partially offset by significantly higher raw and
packaging material costs, which included foreign exchange
transaction costs.
Hill's Pet Nutrition (22% of Company
Sales)
- Organic sales growth was led by the United States and
Europe.
- The decrease in Operating profit as a percentage of Net sales
was primarily due to significantly higher raw and packaging
material costs and unfavorable mix due to private label sales
resulting from the previously disclosed acquisitions of pet food
businesses, partially offset by higher pricing and cost savings
from the Company’s funding-the-growth initiatives.
Prepared Materials and Webcast
Information
At approximately 7:00 a.m. ET today, Colgate will post its
prepared materials (in PDF format) regarding third quarter results
to the Investor Center section of its website at
https://investor.colgatepalmolive.com/events-and-presentations.
At 8:30 a.m. ET today, Colgate will host a conference call
regarding third quarter results. To access this call as a webcast,
please go to Colgate’s website at www.colgatepalmolive.com.
About Colgate-Palmolive
Colgate-Palmolive Company is a caring, innovative growth company
that is reimagining a healthier future for all people, their pets
and our planet. Focused on Oral Care, Personal Care, Home Care and
Pet Nutrition, we sell our products in more than 200 countries and
territories under brands such as Colgate, Palmolive, elmex, hello,
meridol, Sorriso, Tom’s of Maine, EltaMD, Filorga, Irish Spring,
PCA SKIN, Protex, Sanex, Softsoap, Speed Stick, Ajax, Axion,
Fabuloso, Soupline and Suavitel, as well as Hill’s Science Diet and
Hill’s Prescription Diet. The Company is recognized for its
leadership and innovation in promoting sustainability and community
wellbeing, including its achievements in decreasing plastic waste
and promoting recyclability, saving water, conserving natural
resources and improving children’s oral health through the Colgate
Bright Smiles, Bright Futures program, which has reached more than
1.6 billion children since 1991. For more information about
Colgate’s global business and how the Company is building a future
to smile about, visit www.colgatepalmolive.com. CL-E
Market Share Information
Management uses market share information as a key indicator to
monitor business health and performance. References to market share
in this press release are based on a combination of consumption and
market share data provided by third-party vendors, primarily
Nielsen, and internal estimates. All market share references
represent the percentage of the dollar value of sales of our
products, relative to all product sales in the category in the
countries in which the Company competes and purchases data
(excluding Venezuela from all periods).
Market share data is subject to limitations on the availability
of up-to-date information. In particular, market share data is
currently not generally available for certain retail channels, such
as eCommerce and certain club retailers and discounters. The
Company measures year-to-date market shares from January 1 of the
relevant year through the most recent period for which market share
data is available, which typically reflects a lag time of one or
two months. The Company believes that the third-party vendors it
uses to provide data are reliable, but it has not verified the
accuracy or completeness of the data or any assumptions underlying
the data. In addition, market share information reported by the
Company may be different from market share information reported by
other companies due to differences in category definitions, the use
of data from different countries, internal estimates and other
factors.
Cautionary Statement on Forward-Looking
Statements
This press release and the related webcast may contain
forward-looking statements (as that term is defined in the U.S.
Private Securities Litigation Reform Act of 1995 or by the
Securities and Exchange Commission (SEC) in its rules, regulations
and releases) that set forth anticipated results based on
management’s current plans and assumptions. Such statements may
relate, for example, to sales or volume growth, net selling price
increases, organic sales growth, profit or profit margin levels,
earnings per share levels, financial goals, the impact of foreign
exchange, the impact of COVID-19, the impact of the war in Ukraine,
the impact of the Israel-Hamas war, cost-reduction plans (including
the 2022 Global Productivity Initiative), tax rates, interest
rates, new product introductions, digital capabilities, commercial
investment levels, acquisitions, divestitures, share repurchases or
legal or tax proceedings, among other matters. These statements are
made on the basis of the Company’s views and assumptions as of this
time and the Company undertakes no obligation to update these
statements whether as a result of new information, future events or
otherwise, except as required by law or by the rules and
regulations of the SEC. Moreover, the Company does not, nor does
any other person, assume responsibility for the accuracy and
completeness of these statements. The Company cautions investors
that any such forward-looking statements are not guarantees of
future performance and that actual events or results may differ
materially from those statements. For more information about
factors that could impact the Company’s business and cause actual
results to differ materially from forward-looking statements,
investors should refer to the Company’s filings with the SEC
(including, but not limited to, the information set forth under the
captions “Risk Factors” and “Cautionary Statement on
Forward-Looking Statements” in the Company’s Annual Report on Form
10-K for the year ended December 31, 2022 and subsequent filings
with the SEC). Copies of these filings may be obtained upon request
from the Company’s Investor Relations Department or on the
Company’s website at www.colgatepalmolive.com.
Non-GAAP Financial
Measures
The following provides definitions and other information
regarding the non-GAAP financial measures used in this press
release and the related prepared materials and webcast, which may
not be the same as or comparable to similar measures presented by
other companies:
- Base Business: Base Business refers to non-GAAP measures of
operating results that exclude certain items. Base Business
operating results exclude, as applicable, charges related to an
ERISA litigation matter, a foreign tax matter, the 2022 Global
Productivity Initiative, product recall costs, a gain on the sale
of land in Asia Pacific and acquisition-related costs.
- Organic sales growth: Net sales growth excluding the impact of
foreign exchange, acquisitions and divestments.
- Free cash flow before dividends: Net cash provided by
operations less Capital expenditures.
This press release discusses Net sales growth (GAAP) and Organic
sales growth (non-GAAP). Management believes the organic sales
growth measure provides investors and analysts with useful
supplemental information regarding the Company’s underlying sales
trends by presenting sales growth excluding the external factor of
foreign exchange as well as the impact from acquisitions and
divestments. See “Geographic Sales Analysis Percentage Changes” for
the three and nine months ended September 30, 2023 versus 2022
included with this release for a comparison of Organic sales growth
to Net sales growth in accordance with GAAP.
Gross profit, Gross profit margin, Selling, general and
administrative expenses, Selling, general and administrative
expenses as a percentage of Net sales, Other (income) expense, net,
Operating profit, Operating profit margin, Non-service related
postretirement costs, Effective income tax rate, Net income
attributable to Colgate-Palmolive Company and Diluted earnings per
common share are disclosed on both an as reported (GAAP) and Base
Business (non-GAAP) basis. These non-GAAP financial measures
exclude items that, either by their nature or amount, management
would not expect to occur as part of the Company’s normal business
on a regular basis, such as restructuring charges, charges for
certain litigation and tax matters, acquisition-related costs,
gains and losses from certain divestitures and certain other
unusual, non-recurring items. Investors and analysts use these
financial measures in assessing the Company’s business performance,
and management believes that presenting these financial measures on
a non-GAAP basis provides them with useful supplemental information
to enhance their understanding of the Company’s underlying business
performance and trends. These non-GAAP financial measures also
enhance the ability to compare period-to-period financial results.
See “Non-GAAP Reconciliations” for the three and nine months ended
September 30, 2023 and 2022 included with this release for a
reconciliation of these financial measures to the related GAAP
measures.
The Company uses these financial measures internally in its
budgeting process, to evaluate segment and overall operating
performance and as factors in determining compensation. While the
Company believes that these financial measures are useful in
evaluating the Company’s underlying business performance and
trends, this information should be considered as supplemental in
nature and is not meant to be considered in isolation or as a
substitute for the related financial information prepared in
accordance with GAAP.
As management uses free cash flow before dividends to evaluate
the Company’s ability to satisfy current and future obligations,
pay dividends, fund future business opportunities and repurchase
stock, the Company believes that it provides useful information to
investors. Free cash flow before dividends is not a measure of cash
available for discretionary expenditures since the Company has
certain non-discretionary obligations such as debt service that are
not deducted from the measure. See “Condensed Consolidated
Statements of Cash Flows” for the nine months ended September 30,
2023 and 2022 for a comparison of free cash flow before dividends
to Net cash provided by operations as reported in accordance with
GAAP.
(See attached tables for third quarter
results.)
Table 1
Colgate-Palmolive
Company
Condensed Consolidated
Statements of Income
For the Three Months Ended
September 30, 2023 and 2022
(Dollars in Millions Except
Per Share Amounts) (Unaudited)
2023
2022
Net sales
$
4,915
$
4,455
Cost of sales
2,038
1,907
Gross profit
2,877
2,548
Gross profit margin
58.5
%
57.2
%
Selling, general and administrative
expenses
1,822
1,634
Other (income) expense, net
26
(33
)
Operating profit
1,029
947
Operating profit margin
20.9
%
21.3
%
Non-service related postretirement
costs
15
15
Interest (income) expense, net
58
40
Income before income taxes
956
892
Provision for income taxes
209
210
Effective tax rate
21.9
%
23.5
%
Net income including noncontrolling
interests
747
682
Less: Net income attributable to
noncontrolling interests
39
64
Net income attributable to
Colgate-Palmolive Company
$
708
$
618
Earnings per common share
Basic
$
0.86
$
0.74
Diluted
$
0.86
$
0.74
Supplemental Income Statement
Information
Average common shares outstanding
Basic
825.6
835.7
Diluted
827.3
838.5
Advertising
$
598
$
486
Table 2
Colgate-Palmolive
Company
Condensed Consolidated
Statements of Income
For the Nine Months Ended
September 30, 2023 and 2022
(Dollars in Millions Except
Per Share Amounts) (Unaudited)
2023
2022
Net sales
$
14,507
$
13,338
Cost of sales
6,131
5,664
Gross profit
8,376
7,674
Gross profit margin
57.7
%
57.5
%
Selling, general and administrative
expenses
5,348
4,932
Other (income) expense, net
116
51
Operating profit
2,912
2,691
Operating profit margin
20.1
%
20.2
%
Non-service related postretirement
costs
338
65
Interest (income) expense, net
170
98
Income before income taxes
2,404
2,528
Provision for income taxes
709
604
Effective tax rate
29.5
%
23.9
%
Net income including noncontrolling
interests
1,695
1,924
Less: Net income attributable to
noncontrolling interests
113
144
Net income attributable to
Colgate-Palmolive Company
$
1,582
$
1,780
Earnings per common share
Basic(1)
$
1.91
$
2.12
Diluted(1)
$
1.90
$
2.12
Supplemental Income Statement
Information
Average common shares outstanding
Basic
828.8
837.7
Diluted
830.5
840.4
Advertising
$
1,778
$
1,493
Note:
(1) Basic and diluted earnings per share
are computed independently for each quarter and any year-to-date
period presented. As a result of changes in shares outstanding
during the year and rounding, the sum of the quarters' earnings per
share may not equal the earnings per share for any year-to-date
period.
Table 3
Colgate-Palmolive
Company
Condensed Consolidated Balance
Sheets
As of September 30, 2023,
December 31, 2022 and September 30, 2022
(Dollars in Millions)
(Unaudited)
September 30,
December 31,
September 30,
2023
2022
2022
Cash and cash equivalents
$
951
$
775
$
938
Receivables, net
1,577
1,504
1,425
Inventories
1,931
2,074
2,073
Other current assets
898
760
842
Property, plant and equipment, net
4,409
4,307
4,123
Goodwill
3,327
3,352
3,538
Other intangible assets, net
1,861
1,920
2,219
Other assets
1,089
1,039
1,130
Total assets
$
16,043
$
15,731
$
16,288
Total debt
$
8,724
$
8,766
$
8,248
Other current liabilities
4,568
3,979
4,463
Other non-current liabilities
2,345
2,180
2,524
Total liabilities
15,637
14,925
15,235
Total Colgate-Palmolive Company
shareholders’ equity
(9
)
401
622
Noncontrolling interests
415
405
431
Total liabilities and equity
$
16,043
$
15,731
$
16,288
Supplemental Balance Sheet
Information
Debt less cash, cash equivalents and
marketable securities(1)
$
7,526
$
7,816
$
7,102
Working capital % of sales
(2.1
)%
1.0
%
(1.9
)%
Note:
(1) Marketable securities of $247, $175
and $208 as of September 30, 2023, December 31, 2022 and September
30, 2022, respectively, are included in Other current assets.
Table 4
Colgate-Palmolive
Company
Condensed Consolidated
Statements of Cash Flows
For the Nine Months Ended
September 30, 2023 and 2022
(Dollars in Millions)
(Unaudited)
2023
2022
Operating Activities
Net income including noncontrolling
interests
$
1,695
$
1,924
Adjustments to reconcile Net income
including noncontrolling interests to Net cash provided by
operations:
Depreciation and amortization
417
410
ERISA litigation matter
267
—
Restructuring and termination benefits,
net of cash
(17
)
51
Stock-based compensation expense
97
105
Gain on sale of land
—
(47
)
Deferred income taxes
(109
)
(13
)
Cash effects of changes in:
Receivables
(62
)
(171
)
Inventories
150
(422
)
Accounts payable and other accruals
168
9
Other non-current assets and
liabilities
3
37
Net cash provided by (used in)
operations
2,609
1,883
Investing Activities
Capital expenditures
(508
)
(475
)
Purchases of marketable securities and
investments
(324
)
(239
)
Proceeds from sale of marketable
securities and investments
264
55
Payment for acquisition, net of cash
acquired
—
(817
)
Proceeds from sale of land
—
47
Other investing activities
(31
)
1
Net cash provided by (used in) investing
activities
(599
)
(1,428
)
Financing Activities
Short-term borrowing (repayment) less than
90 days, net
(564
)
(56
)
Principal payments on debt
(903
)
(2
)
Proceeds from issuance of debt
1,497
1,513
Dividends paid
(1,243
)
(1,206
)
Purchases of treasury shares
(883
)
(895
)
Proceeds from exercise of stock
options
325
398
Other financing activities
(30
)
(38
)
Net cash provided by (used in) financing
activities
(1,801
)
(286
)
Effect of exchange rate changes on Cash
and cash equivalents
(33
)
(63
)
Net increase (decrease) in Cash and cash
equivalents
176
106
Cash and cash equivalents at beginning of
the period
775
832
Cash and cash equivalents at end of the
period
$
951
$
938
Supplemental Cash Flow
Information
Free cash flow before dividends (Net cash
provided by operations less Capital expenditures)
Net cash provided by operations
$
2,609
$
1,883
Less: Capital expenditures
(508
)
(475
)
Free cash flow before dividends
$
2,101
$
1,408
Income taxes paid
$
726
$
690
Interest paid
$
243
$
104
Table 5
Colgate-Palmolive
Company
Segment Information
For the Three and Nine Months
Ended September 30, 2023 and 2022
(Dollars in Millions)
(Unaudited)
Three Months Ended September
30,
Nine Months Ended September
30,
2023
2022
2023
2022
Net Sales
Oral, Personal and Home Care
North America
$
990
$
958
$
2,926
$
2,850
Latin America
1,194
997
3,447
2,970
Europe
725
632
2,053
1,925
Asia Pacific
682
709
2,084
2,131
Africa/Eurasia
266
287
822
809
Total Oral, Personal and Home Care
3,857
3,583
11,332
10,685
Pet Nutrition
1,058
872
3,175
2,653
Total Net Sales
$
4,915
$
4,455
$
14,507
$
13,338
Three Months Ended September
30,
Nine Months Ended September
30,
2023
2022
2023
2022
Operating Profit
Oral, Personal and Home Care
North America
$
231
$
198
$
651
$
557
Latin America
372
289
1,050
818
Europe
162
127
412
410
Asia Pacific
193
185
564
556
Africa/Eurasia
66
66
196
160
Total Oral, Personal and Home Care
1,024
865
2,873
2,501
Pet Nutrition
201
201
575
617
Corporate(1)
(196
)
(119
)
(536
)
(427
)
Total Operating Profit
$
1,029
$
947
$
2,912
$
2,691
Note:
(1) Corporate operations include costs
related to stock options and restricted stock units, research and
development costs, Corporate overhead costs, restructuring and
related implementation charges and gains and losses on sales of
non-core product lines and assets.
Corporate Operating profit (loss) for the
three months ended September 30, 2023 included charges resulting
from the 2022 Global Productivity Initiative of $2.
Corporate Operating profit (loss) for the
nine months ended September 30, 2023 included product recall costs
of $25 and charges resulting from the 2022 Global Productivity
Initiative of $25.
Corporate Operating profit (loss) for the
three months ended September 30, 2022 included charges resulting
from the 2022 Global Productivity Initiative of $3, a gain on the
sale of land in Asia Pacific of $47 and acquisition-related costs
of $17.
Corporate Operating profit (loss) for the
nine months ended September 30, 2022 included charges resulting
from the 2022 Global Productivity Initiative of $79, a gain on the
sale of land in Asia Pacific of $47 and acquisition-related costs
of $17.
Table 6
Colgate-Palmolive
Company
Geographic Sales Analysis
Percentage Changes
For the Three Months Ended
September 30, 2023 vs. 2022
(Unaudited)
COMPONENTS OF SALES
CHANGE
Pricing
Coupons
Sales
Consumer &
Change
Organic
As Reported
Organic
Trade
Foreign
Region
As
Reported
Sales
Change
Volume(1)
Volume
Incentives
Exchange
Total Company
10.5
%
9.0
%
0.5
%
(0.5
)%
9.5
%
0.5
%
North America
3.5
%
3.5
%
(4.0
)%
(4.0
)%
7.5
%
—
%
Latin America
20.0
%
15.0
%
5.5
%
5.5
%
9.5
%
5.0
%
Europe
14.5
%
7.0
%
(4.0
)%
(4.0
)%
11.0
%
7.5
%
Asia Pacific
(4.0
)%
(1.5
)%
(7.0
)%
(7.0
)%
5.5
%
(2.5
)%
Africa/Eurasia
(7.5
)%
15.5
%
4.0
%
4.0
%
11.5
%
(23.0
)%
Total CP Products
7.5
%
7.5
%
(1.0
)%
(1.0
)%
8.5
%
—
%
Hill’s
21.5
%
15.0
%
9.0
%
3.0
%
12.0
%
0.5
%
Emerging Markets(2)
8.5
%
10.0
%
1.0
%
1.0
%
9.0
%
(1.5
)%
Developed Markets
12.0
%
8.0
%
0.5
%
(1.5
)%
9.5
%
2.0
%
Notes:
(1) The impact of the previously disclosed
acquisitions of pet food businesses on as reported volume was 1.0%,
6.0% and 2.0% for Total Company, Hill's and Developed Markets,
respectively.
(2) Emerging Markets include Latin
America, Asia (excluding Japan), Africa/Eurasia and Central
Europe.
Table 7
Colgate-Palmolive
Company
Geographic Sales Analysis
Percentage Changes
For the Nine Months Ended
September 30, 2023 vs. 2022
(Unaudited)
COMPONENTS OF SALES
CHANGE
Pricing
Coupons
Sales
Consumer &
Change
Organic
As Reported
Organic
Trade
Foreign
Region
As
Reported
Sales
Change
Volume(1)
Volume
Incentives
Exchange
Total Company
9.0
%
9.0
%
(0.5
)%
(2.0
)%
11.0
%
(1.5
)%
North America
2.5
%
3.0
%
(6.0
)%
(6.0
)%
9.0
%
(0.5
)%
Latin America
16.0
%
15.0
%
1.0
%
1.0
%
14.0
%
1.0
%
Europe
6.5
%
5.5
%
(4.5
)%
(4.5
)%
10.0
%
1.0
%
Asia Pacific
(2.0
)%
2.5
%
(3.5
)%
(3.5
)%
6.0
%
(4.5
)%
Africa/Eurasia
1.5
%
17.5
%
3.0
%
3.0
%
14.5
%
(16.0
)%
Total CP Products
6.0
%
8.0
%
(2.5
)%
(2.5
)%
10.5
%
(2.0
)%
Hill’s
19.5
%
13.0
%
8.5
%
1.0
%
12.0
%
(1.0
)%
Emerging Markets(2)
8.0
%
11.0
%
(0.5
)%
(0.5
)%
11.5
%
(3.0
)%
Developed Markets
9.5
%
7.0
%
—
%
(3.0
)%
10.0
%
(0.5
)%
Notes:
(1) The impact of the previously disclosed
acquisitions of pet food businesses on as reported volume was 1.5%,
7.5% and 3.0% for Total Company, Hill's and Developed Markets,
respectively.
(2) Emerging Markets include Latin
America, Asia (excluding Japan), Africa/Eurasia and Central
Europe.
Table 8
Colgate-Palmolive
Company
Non-GAAP
Reconciliations
For the Three Months Ended
September 30, 2023 and 2022
(Dollars in Millions Except
Per Share Amounts) (Unaudited)
Gross Profit
2023
2022
Gross profit, GAAP
$
2,877
$
2,548
2022 Global Productivity Initiative
1
—
Gross profit, non-GAAP
$
2,878
$
2,548
Basis Point
Gross Profit Margin
2023
2022
Change
Gross profit margin, GAAP
58.5
%
57.2
%
130
2022 Global Productivity Initiative
0.1
%
—
%
Gross profit margin, non-GAAP
58.6
%
57.2
%
140
Selling, General and Administrative
Expenses
2023
2022
Selling, general and administrative
expenses, GAAP
$
1,822
$
1,634
2022 Global Productivity Initiative
—
(1
)
Selling, general and administrative
expenses, non-GAAP
$
1,822
$
1,633
Other (Income) Expense, Net
2023
2022
Other (income) expense, net, GAAP
$
26
$
(33
)
2022 Global Productivity Initiative
(1
)
(2
)
Gain on the sale of land in Asia
Pacific
—
47
Acquisition-related costs
—
(17
)
Other (income) expense, net, non-GAAP
$
25
$
(5
)
Operating Profit
2023
2022
% Change
Operating profit, GAAP
$
1,029
$
947
9
%
2022 Global Productivity Initiative
2
3
Gain on the sale of land in Asia
Pacific
—
(47
)
Acquisition-related costs
—
17
Operating profit, non-GAAP
$
1,031
$
920
12
%
Basis Point
Operating Profit Margin
2023
2022
Change
Operating profit margin, GAAP
20.9
%
21.3
%
(40
)
2022 Global Productivity Initiative
0.1
%
0.1
%
Gain on the sale of land in Asia
Pacific
—
%
(1.1
)%
Acquisition-related costs
—
%
0.4
%
Operating profit margin, non-GAAP
21.0
%
20.7
%
30
Non-Service Related Postretirement
Costs
2023
2022
Non-service related postretirement costs,
GAAP
$
15
$
15
2022 Global Productivity Initiative
—
1
Non-service related postretirement costs,
non-GAAP
$
15
$
16
Table 8
Continued
Colgate-Palmolive
Company
Non-GAAP
Reconciliations
For the Three Months Ended
September 30, 2023 and 2022
(Dollars in Millions Except
Per Share Amounts) (Unaudited)
2023
Income Before Income
Taxes
Provision For Income
Taxes(1)
Net Income
Including Noncontrolling Interests
Less: Income Attributable to
Noncontrolling Interests
Net Income Attributable
To Colgate- Palmolive Company
Effective Income Tax
Rate(2)
Diluted Earnings Per
Share
As Reported GAAP
$
956
$
209
$
747
$
39
$
708
21.9
%
$
0.86
2022 Global Productivity Initiative
2
—
2
—
2
(0.1
)%
—
Non-GAAP
$
958
$
209
$
749
$
39
$
710
21.8
%
$
0.86
2022
Income Before Income
Taxes
Provision For Income
Taxes(1)
Net Income
Including Noncontrolling Interests
Less: Income Attributable to
Noncontrolling Interests
Net Income Attributable
To Colgate- Palmolive Company
Effective Income Tax
Rate(2)
Diluted Earnings Per
Share
As Reported GAAP
$
892
$
210
$
682
$
64
$
618
23.5
%
$
0.74
2022 Global Productivity Initiative
2
—
2
—
2
(0.1
)%
—
Gain on the sale of land in Asia
Pacific
(47
)
(11
)
(36
)
(21
)
(15
)
0.1
%
(0.02
)
Acquisition-related costs
17
2
15
—
15
(0.2
)%
0.02
Non-GAAP
$
864
$
201
$
663
$
43
$
620
23.3
%
$
0.74
The impact of non-GAAP adjustments may not
necessarily equal the difference between “GAAP” and “non-GAAP” as a
result of rounding.
Notes:
(1) The income tax effect on non-GAAP
items is calculated based upon the tax laws and statutory income
tax rates applicable in the tax jurisdiction(s) of the underlying
non-GAAP adjustment.
(2) The impact of non-GAAP items on the
Company’s effective tax rate represents the difference in the
effective tax rate calculated with and without the non-GAAP
adjustment on Income before income taxes and Provision for income
taxes.
Table 9
Colgate-Palmolive
Company
Non-GAAP
Reconciliations
For the Nine Months Ended
September 30, 2023 and 2022
(Dollars in Millions Except
Per Share Amounts) (Unaudited)
Gross Profit
2023
2022
Gross profit, GAAP
$
8,376
$
7,674
2022 Global Productivity Initiative
1
—
Gross profit, non-GAAP
$
8,377
$
7,674
Selling, General and Administrative
Expenses
2023
2022
Selling, general and administrative
expenses, GAAP
$
5,348
$
4,932
2022 Global Productivity Initiative
(2
)
(4
)
Selling, general and administrative
expenses, non-GAAP
$
5,346
$
4,928
Basis Point
Change
Selling, General and Administrative
Expenses as a Percentage of Net Sales
2023
2022
Selling, general and administrative
expenses as a percentage of Net sales, GAAP
36.9
%
37.0
%
(10
)
2022 Global Productivity Initiative
—
%
(0.1
)%
Selling, general and administrative
expenses as a percentage of Net sales, non-GAAP
36.9
%
36.9
%
—
Other (Income) Expense, Net
2023
2022
Other (income) expense, net, GAAP
$
116
$
51
Product recall costs
(25
)
—
2022 Global Productivity Initiative
(22
)
(75
)
Gain on the sale of land in Asia
Pacific
—
47
Acquisition-related costs
—
(17
)
Other (income) expense, net, non-GAAP
$
69
$
6
Operating Profit
2023
2022
% Change
Operating profit, GAAP
$
2,912
$
2,691
8
%
Product recall costs
25
—
2022 Global Productivity Initiative
25
79
Gain on the sale of land in Asia
Pacific
—
(47
)
Acquisition-related costs
—
17
Operating profit, non-GAAP
$
2,962
$
2,740
8
%
Basis Point
Operating Profit Margin
2023
2022
Change
Operating profit margin, GAAP
20.1
%
20.2
%
(10
)
Product recall costs
0.2
%
—
%
2022 Global Productivity Initiative
0.1
%
0.6
%
Gain on the sale of land in Asia
Pacific
—
%
(0.4
)%
Acquisition-related costs
—
%
0.1
%
Operating profit margin, non-GAAP
20.4
%
20.5
%
(10
)
Non-Service Related Postretirement
Costs
2023
2022
Non-service related postretirement costs,
GAAP
$
338
$
65
ERISA litigation matter
(267
)
—
2022 Global Productivity Initiative
(4
)
(13
)
Non-service related postretirement costs,
non-GAAP
$
67
$
52
Table 9
Continued
Colgate-Palmolive
Company
Non-GAAP
Reconciliations
For the Nine Months Ended
September 30, 2023 and 2022
(Dollars in Millions Except
Per Share Amounts) (Unaudited)
2023
Income Before Income
Taxes
Provision For Income
Taxes(1)
Net Income
Including Noncontrolling Interests
Less: Income Attributable to
Noncontrolling Interests
Net Income Attributable
To Colgate- Palmolive Company
Effective Income Tax
Rate(2)
Diluted Earnings Per
Share
As Reported GAAP
$
2,404
$
709
$
1,695
$
113
$
1,582
29.5
%
$
1.90
ERISA litigation matter
267
55
212
—
212
(0.9
)%
0.26
Foreign tax matter
—
(126
)
126
—
126
(4.7
)%
0.15
2022 Global Productivity Initiative
29
5
24
1
23
(0.1
)%
0.03
Product recall costs
25
6
19
—
19
—
%
0.02
Non-GAAP
$
2,725
$
649
$
2,076
$
114
$
1,962
23.8
%
$
2.36
2022
Income Before Income
Taxes
Provision For Income
Taxes(1)
Net Income
Including Noncontrolling Interests
Less: Income Attributable to
Noncontrolling Interests
Net Income Attributable
To Colgate- Palmolive Company
Effective Income Tax
Rate(2)
Diluted Earnings Per
Share
As Reported GAAP
$
2,528
$
604
$
1,924
$
144
$
1,780
23.9
%
$
2.12
2022 Global Productivity Initiative
92
19
73
1
72
(0.1
)%
0.08
Gain on the sale of land in Asia
Pacific
(47
)
(11
)
(36
)
(21
)
(15
)
—
%
(0.02
)
Acquisition-related costs
17
2
15
—
15
(0.1
)%
0.02
Non-GAAP
$
2,590
$
614
$
1,976
$
124
$
1,852
23.7
%
$
2.20
The impact of non-GAAP adjustments may not necessarily equal the
difference between “GAAP” and “non-GAAP” as a result of rounding.
Notes:
(1) The income tax effect on non-GAAP
items is calculated based upon the tax laws and statutory income
tax rates applicable in the tax jurisdiction(s) of the underlying
non-GAAP adjustment.
(2) The impact of non-GAAP items on the
Company’s effective tax rate represents the difference in the
effective tax rate calculated with and without the non-GAAP
adjustments on Income before income taxes and Provision for income
taxes.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231027391649/en/
Investor Relations: investor_relations@colpal.com
Communications: colgate_palmolive_media_inquiry@colpal.com
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