Excellent Worldwide Sales and Unit Volume Growth NEW YORK, Nov. 1,
2005 /PRNewswire-FirstCall/ -- Colgate-Palmolive Company (NYSE:CL)
today announced excellent worldwide sales and unit volume growth
for third quarter 2005, with every operating division reporting
sales and profit increases. Worldwide sales as reported rose 8.0%
to an all-time record level, reflecting unit volume growth of 5.0%.
Sales and unit volume grew 8.5% and 5.5%, respectively, excluding
divestments. Positive foreign exchange added 2.0% and global
pricing increased 1.0%. The strong top and bottom line growth was
accompanied by advertising increases in every operating division as
well. As previously disclosed and consistent with its focused
business strategies, the Company sold its heavy-duty laundry
detergent brands in North America during the quarter for an
after-tax gain of $60.6 million. This gain was more than offset by
$29.9 million of after-tax charges associated with the Company's
previously announced 2004 Restructuring Program, $36.5 million of
income taxes for incremental repatriation of foreign earnings
related to the American Jobs Creation Act, as previously announced,
and a $16.7 million after-tax, one-time, non-cash charge relating
to certain pension obligations as required by FAS 88. Reported net
income and diluted earnings per share were $347.2 million and $.63,
respectively, including the restructuring charge and the other
items noted above. Excluding these items, net income in the quarter
increased 12% versus third quarter 2004 to $369.7 million and
diluted earnings per share increased 15% to $.67. In third quarter
2004, reported net income and diluted earnings per share were
$329.0 million and $.58, respectively. As reported, gross profit
margin was 54.2%. Excluding restructuring charges, gross profit
margin was 55.1%, a third quarter record and a 30 basis point
improvement versus the year ago quarter. Operating profit as
reported increased 12% versus third quarter 2004. Excluding the
restructuring charge and the other items noted above, operating
profit increased 7% after a 15% increase in total advertising
worldwide in the current quarter. Advertising supporting Colgate's
brands was $327.9 million, an all-time record level, with every
operating division increasing their advertising spending during the
quarter. Net cash provided by operations on a year to date basis
increased to $1,305.4 million, up 6% versus the year ago period.
End of third quarter working capital improved versus year ago to
2.6% of sales. Reuben Mark, Chairman and CEO said, "We are pleased
that our strong top- line momentum continued this quarter across
all operating divisions and on top of the outstanding growth
achieved in the year ago period. "We are especially encouraged that
global pricing was positive for the first time in two years despite
difficult cost and competitive environments. "Colgate's global
leadership in toothpaste expanded even further during the quarter,
with market shares reaching record highs both here in the U.S. and
in key countries around the world. Colgate's growth in manual
toothbrushes continues to strengthen also, with our global market
share in this category increasing versus year ago for the seventh
consecutive quarter to another record high. "Unit volume in Oral
Care was up significantly in every geographic division, and was up
10% worldwide. "Colgate's fundamentals are very strong. Gross
profit margin before restructuring charges expanded during the
quarter, despite sharply rising energy costs, as a result of our
ongoing cost-saving initiatives and improving pricing trends for
our products. These together funded a sizable increase in worldwide
advertising, both absolutely and as a percent to sales, thus
further increasing our ongoing momentum. "We are confident that the
strong revenue momentum and continued excellent results from our
cost-saving initiatives should enable us to achieve high
single-digit E.P.S. growth this year, and to return to double-digit
E.P.S. growth in 2006, excluding restructuring charges." As
previously disclosed, the 2004 Restructuring Program is projected
to result in cumulative after-tax charges of between $550 and $650
million by 2008. Annual after-tax savings are expected to be in the
range of $250 to $300 million by 2008. At 11:00 a.m. ET today,
Colgate will host a conference call to elaborate on third quarter
results. To access this call as a webcast, please go to Colgate's
web site at http://www.colgate.com/. The following are comments
about divisional performance. See attached Geographic Sales
Analysis and Segment Information schedules for additional
information on divisional sales and operating profit. North America
(22% of Company Sales) Strong growth continued in North America,
fueled by new product sales and market share gains. Sales as
reported rose 5.0% during the quarter to an all- time record level.
Sales and unit volume, excluding divestments, grew 7.5% and 6.0%,
respectively, on top of very strong growth in the year ago period.
Volume growth as reported increased 3.5%, positive foreign exchange
added 1.0% while pricing increased 0.5%. This is the fourth
consecutive quarter of sequential price improvement in North
America. North American operating profit increased 2% which
included higher advertising spending during the quarter as well as
higher freight and raw and packaging material costs. Colgate's
leadership of the U.S. toothpaste market continues to grow, with
its ACNielsen market share reaching 35.5% year to date, up 70 basis
points versus the year ago period and over three share points ahead
of the number two competitor. In the U.S., new products are
generating strong volume and market share growth. Key categories
continuing to gain market share year to date versus prior year
include toothpaste, manual and powered toothbrushes, hand
dishwashing liquid, bar soap and fabric conditioners. In oral care,
strong testimonial advertising for Colgate Total toothpaste
combined with growth in Colgate Max Fresh toothpaste and Colgate
360 Degree manual toothbrush contributed to the share gains. New
products contributing to growth in other categories include
Palmolive Oxy Plus dishwashing liquid, Irish Spring MicroClean bar
soap and Fabuloso Orange Burst liquid cleaner. Top-line growth in
the U.S. is expected to continue in the balance of the year driven
by new product launches supported by higher commercial spending.
Recent introductions now shipping nationwide include Colgate
Luminous toothpaste, Colgate Oxygen 2in1 liquid toothpaste,
Palmolive Cucumber and Melon dishwashing liquid, and Softsoap
Kitchen Fresh Hands and Softsoap Advanced Protection Foam liquid
hand soaps. Latin America (23% of Company Sales) Latin American
dollar sales grew 18.0% in the third quarter to an all-time record
level. Unit volume for the region grew 5.5% on top of excellent
growth in the year ago period. Nearly every country in the region
contributed to the good top-line gains led by Brazil, Venezuela,
Argentina, Central America and Mexico. Positive foreign exchange
added 7.5% with 5.0% higher pricing. Latin American operating
profit increased 13%, even after a strong double- digit increase in
advertising behind Colgate brands during the quarter. Colgate
continues to build its extremely strong leadership in oral care
throughout Latin America with toothpaste market share gains seen in
nearly every country in the region, reaching record highs in
Venezuela, Ecuador, Chile, Colombia and Central America. New
products contributing to these gains include Colgate Max Fresh,
Colgate Sensitive and Colgate Triple Action Spearmint toothpastes,
Colgate MicroSonic battery-powered toothbrush and the relaunch of
Colgate Total toothpaste with new packaging and strong advertising
highlighting the toothpaste's ability to provide complete 12 hour
protection while actively fighting 12 teeth and gum problems. New
products succeeding in other categories are Palmolive Nutri-Milk
and Protex Oats bar soaps, Palmolive Hydra Natura hand and body
lotion, and Lady Speed Stick and Speed Stick multiform deodorants.
Europe (24% of Company Sales) European dollar sales and unit volume
grew 2.5% and 4.5%, respectively, on top of a very strong
performance in the year ago quarter. Foreign exchange was even with
the year ago period and pricing was 2.0% lower. Volume gains were
achieved in the United Kingdom, Denmark, Holland, Spain, Ireland,
Russia, Turkey, Ukraine, Adria, Romania, Poland, the Baltic States
and Czech Republic. The GABA oral care business continues to
perform ahead of expectations, achieving strong sales and unit
volume growth during the quarter. Operating profit for the region
increased 4% to a record level as good volume growth helped fund an
all-time record level of advertising spending during the quarter.
Colgate strengthened its oral care leadership in Western Europe
with regional market shares in toothpaste and manual toothbrushes
both increasing year to date. Successful new products driving these
gains include Colgate Sensitive Plus Whitening and Colgate Oxygen
toothpastes, Colgate 360 Degree manual toothbrush and Colgate
MicroSonic battery-powered toothbrush. Recent innovations
contributing to gains in other categories include Palmolive Olive
shower gel, bath foam and liquid hand soap, Palmolive Thermal Spa
shower gel and body scrub and Ajax Professional Degreaser spray
cleaner. Throughout Central Europe and Russia, Colgate expanded its
leadership of the toothpaste market during the quarter, with its
regional market share reaching a record high in the latest period.
Record high toothpaste shares were achieved in Russia, Turkey,
Ukraine, Poland, Croatia, Hungary, Czech Republic, Slovenia and
Slovakia. Share gains in the region were driven by strong sales of
Colgate Total and Colgate Sensitive toothpastes as well as the
recent launch of Colgate Max Fresh toothpaste in both tube and
liquid form. Colgate also strengthened its leadership in
toothbrushes throughout the region with its regional market share
reaching another all-time high during the quarter driven by the
success of Colgate 360 Degree manual toothbrush and the Colgate
Smiles line of manual toothbrushes for kids. Asia/Africa (18% of
Company Sales) Asia/Africa sales and unit volume grew 9.5% and
7.0%, respectively, on top of strong growth in the year ago
quarter. Healthy volume gains were achieved in China, India, Hong
Kong, Philippines, Malaysia, Australia, Taiwan, South Africa and
Zimbabwe. Positive foreign exchange added 2.5% and pricing was even
with the year ago quarter. Operating profit for the region
increased 7% to a record level, despite a record level of
advertising behind Colgate brands during the quarter. China region
unit volume and operating profit increased strongly during the
quarter versus year ago. Colgate strengthened its oral care
leadership in the Asia Pacific region led by toothpaste market
share gains in China, India, Thailand, the Philippines, New Zealand
and Australia. Regional toothbrush market shares for the Colgate
equity reached a record high during the quarter. Successful new
products driving the oral care growth include Colgate Max Fresh and
Darlie Tea Care toothpastes, Colgate 360 Degree manual toothbrush
and Colgate MicroSonic battery-powered toothbrush. New products
contributing to growth in other categories throughout the region
include Palmolive Aroma Creme shower gel and liquid hand soap,
Palmolive Naturals Sun Care bar soap and Palmolive Aromatherapy
shampoo. Hill's (13% of Company Sales) Innovative new products and
veterinary endorsements continue to drive growth at Hill's, the
world leader in specialty pet food. Unit volume grew 4.0% in the
third quarter and dollar sales rose 7.0% reflecting favorable 1.5%
foreign exchange and 1.5% higher pricing. Operating profit
increased 14% to a record level during the quarter. Innovative new
products contributing to growth in the U.S. specialty retail
channel during the quarter include Science Diet Canine Lamb &
Rice Large Breed, Science Diet Canine Small Bites and Science Diet
Indoor Cat pet foods. In the U.S. veterinary channel, sales of new
Prescription Diet Canine j/d, a food clinically proven to improve
mobility in dogs with arthritis, continue to exceed expectations.
Internationally, growth was strong led by Australia, Taiwan, Korea,
South Africa, Spain, Russia, Belgium and Finland. New products
contributing to growth include Science Diet Canine Senior Large
Breed, Prescription Diet Canine j/d, Prescription Diet Canine z/d
and Prescription Diet Feline z/d. * * * About Colgate-Palmolive:
Colgate-Palmolive is a leading global consumer products company,
tightly focused on Oral Care, Personal Care, Home 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, Elmex, Ajax, Axion, Soupline, Suavitel,
and 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 at http://www.colgate.com/. This press release
and the related webcast (other than historical information) may
contain 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 information set forth under the caption "Cautionary
Statement on Forward- Looking Statements" in the Company's Form
10-K for the year ended December 31, 2004) 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 or the Company's web site at http://www.colgate.com/.
Non-GAAP Financial Measures The following provides information
regarding the non-GAAP measures used in this earnings release: To
supplement Colgate's September 30, 2005 condensed consolidated
financial statements presented in accordance with accounting
principles generally accepted in the United States of America
(GAAP), the Company has disclosed non-GAAP measures of operating
results that exclude certain items. Gross profit margin, operating
profit, effective tax rate, net income, and earnings per share are
discussed in this release both as reported (on a GAAP basis) and
excluding the impact of certain items, which are composed of
charges related to the restructuring program that began in the
fourth quarter of 2004 and is expected to be substantially
completed by 2008 (the "2004 Restructuring Program") as well as
three "Other Items," as explained below. The restructuring charges,
which are reported in the corporate segment, include
separation-related costs, incremental depreciation and asset write-
downs and other costs related to the implementation of the 2004
Restructuring Program. Other Items is comprised of the gain on sale
of the Company's heavy- duty laundry detergent business in North
America, an income tax charge for incremental repatriation of
foreign earnings related to the American Jobs Creation Act and a
pension charge associated with the remeasurement of certain pension
obligations as required by Statement of Financial Accounting
Standards (SFAS) No. 88, "Employers' Accounting for Settlement and
Curtailments of Defined Benefit Pension Plans and for Termination
Benefits". These pension charges were a result of the conversion of
one of the Company's international pension plans to a defined
contribution plan for all eligible participants and a lump sum
payment of normal retirement benefits associated with a retirement
plan in the United States. The amount of each such excluded item is
set forth in the table entitled "Supplemental Consolidated Income
Statement Information -- Components of 2004 Restructuring Program
and Other Items" included with this release. In light of their
nature and magnitude, the Company believes the above items should
be presented separately to enhance an investor's overall
understanding of its ongoing operations. Management believes these
non-GAAP financial measures provide useful information to investors
regarding the underlying business trends and performance of the
Company's ongoing operations and are useful for period over period
comparisons of such operations. The Company uses these financial
measures internally in its budgeting process and as factors in
determining compensation. While the Company believes that these
financial measures are useful in evaluating the Company's business,
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.
In addition, these non-GAAP financial measures may not be the same
as similar measures presented by other companies. See "Consolidated
Income Statement and Supplemental Information -- Reconciliation
Excluding the 2004 Restructuring Program and Other Items" for the
three months ended September 30, 2005 and 2004 and for the nine
months ended September 30, 2005 and 2004 included with this release
for a reconciliation of these financial measures to the related
GAAP measures. Sales and unit volume growth, both worldwide and in
relevant geographic divisions, are discussed in this release both
as reported and excluding divestments. Management believes this
provides useful information to investors as it allows comparisons
of sales and volume growth from ongoing operations. See "Geographic
Sales Analysis, Percentage Changes - Third Quarter 2005 vs. 2004"
for a comparison of sales excluding divestments to sales as
reported in accordance with GAAP. The Company defines free cash
flow before dividends as net cash provided by operations less
capital expenditures. As management uses this measure to evaluate
the Company's ability to satisfy current and future obligations,
repurchase stock, pay dividends and fund future business
opportunities, 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. Free cash flow
before dividends is not a GAAP measurement and may not be
comparable to similarly titled measures reported by other
companies. Table 1 Colgate-Palmolive Company Consolidated Income
Statement and Supplemental Information Reconciliation Excluding the
2004 Restructuring Program and Other Items For the three months
ended September 30, 2005 and 2004 (Dollars in Millions Except Per
Share Amounts) (Unaudited) 2005 2004 Excluding As Restructuring
Restructuring As Reported & Other (a) & Other Reported Net
sales $2,911.8 $- $2,911.8 $2,695.7 Cost of sales 1,334.2 25.7
1,308.5 1,219.0 Gross profit 1,577.6 (25.7) 1,603.3 1,476.7 Gross
profit margin 54.2% 55.1% 54.8% Selling, general and administrative
expenses 1,007.0 0.5 1,006.5 929.1 Other (income) expense, net
(33.7) (54.7) 21.0 9.9 Operating profit 604.3 28.5 575.8 537.7
Operating profit margin 20.8% 19.8% 19.9% Interest expense, net
36.8 - 36.8 30.1 Income before income taxes 567.5 28.5 539.0 507.6
Provision for income taxes 220.3 51.0 169.3 178.6 Effective tax
rate 38.8% 31.4% 35.2% Net income 347.2 (22.5) 369.7 329.0 Earnings
per common share Basic $0.66 $(0.04) $0.70 $0.61 Diluted $0.63
$(0.04) $0.67 $0.58 Average common shares outstanding Basic 518.8
518.8 518.8 530.8 Diluted 554.3 554.3 554.3 568.8 (a) See
Supplemental Consolidated Income Statement Information - Components
of 2004 Restructuring Program and Other Items for details. Table 2
Colgate-Palmolive Company Consolidated Income Statement and
Supplemental Information Reconciliation Excluding the 2004
Restructuring Program and Other Items For the nine months ended
September 30, 2005 and 2004 (Dollars in Millions Except Per Share
Amounts) (Unaudited) 2005 2004 Excluding As Restructuring
Restructuring As Reported & Other (a) & Other Reported Net
sales $8,492.3 $- $8,492.3 $7,780.9 Cost of sales 3,872.0 59.5
3,812.5 3,481.0 Gross profit 4,620.3 (59.5) 4,679.8 4,299.9 Gross
profit margin 54.4% 55.1% 55.3% Selling, general and administrative
expenses 2,910.5 0.5 2,910.0 2,621.5 Other (income) expense, net
71.8 (2.8) 74.6 24.6 Operating profit 1,638.0 (57.2) 1,695.2
1,653.8 Operating profit margin 19.3% 20.0% 21.3% Interest expense,
net 99.3 - 99.3 87.7 Income before income taxes 1,538.7 (57.2)
1,595.9 1,566.1 Provision for income taxes 548.5 38.6 509.9 524.7
Effective tax rate 35.6% 32.0% 33.5% Net income 990.2 (95.8)
1,086.0 1,041.4 Earnings per common share Basic $1.86 $(0.18) $2.04
$1.92 Diluted $1.78 $(0.17) $1.95 $1.83 Average common shares
outstanding Basic 521.6 521.6 521.6 531.7 Diluted 557.8 557.8 557.8
570.6 (a) See Supplemental Consolidated Income Statement
Information - Components of 2004 Restructuring Program and Other
Items for details. Table 3 Colgate-Palmolive Company Supplemental
Consolidated Income Statement Information Components of 2004
Restructuring Program and Other Items (Dollars in Million)
(Unaudited) Three Months Ended September 30, 2005 2004 North Tax on
Restructuring American FAS 88 Incremental Total Program Detergent
Pension Remittances Restructuring Sale Charges (AJCA) & Other
Net Sales $- $- $- $- $- Cost of sales 25.7 - - - 25.7 Gross profit
(25.7) - - - (25.7) Selling, general and administrative expenses
0.5 - - - 0.5 Other (income) expense, net 13.6 (93.1) 24.8 - (54.7)
Operating profit (39.8) 93.1 (24.8) - 28.5 Interest Expense, net -
- - - - Income before income taxes (39.8) 93.1 (24.8) - 28.5
Provision for income taxes (9.9) 32.5 (8.1) 36.5 51.0 Net income
(29.9) 60.6 (16.7) (36.5) (22.5) Nine Months Ended September 30,
2005 2004 North Tax on Restructuring American FAS 88 Incremental
Total Program Detergent Pension Remittances Restructuring Sale
Charges (AJCA) & Other Net Sales $- $- $- $- $- Cost of sales
59.5 - - - 59.5 Gross profit (59.5) - - - (59.5) Selling, general
and administrative expenses 0.5 - - - 0.5 Other (income) expense,
net 65.5 (93.1) 24.8 - (2.8) Operating profit (125.5) 93.1 (24.8) -
(57.2) Interest Expense, net - - - - - Income before income taxes
(125.5) 93.1 (24.8) - (57.2) Provision for income taxes (22.3) 32.5
(8.1) 36.5 38.6 Net income (103.2) 60.6 (16.7) (36.5) (95.8) Table
4 Colgate-Palmolive Company Condensed Consolidated Balance Sheets
As of September 30, 2005, December 31, 2004 and September 30, 2004
(Dollars in Millions) (Unaudited) September 30, December 31,
September 30, 2005 2004 2004 Cash and cash equivalents $376.3
$319.6 $370.6 Receivables, net 1,337.2 1,319.9 1,286.7 Inventories
890.4 845.5 863.4 Other current assets 293.6 254.9 295.2 Property,
plant and equipment, net 2,558.5 2,647.7 2,529.5 Other assets,
including goodwill and intangibles 3,198.9 3,285.3 3,144.2 Total
assets $8,654.9 $8,672.9 $8,489.6 Total debt 3,565.4 3,675.1
3,684.7 Other current liabilities 2,210.2 2,145.1 2,067.5 Other
non-current liabilities 1,576.6 1,607.3 1,490.3 Total shareholders'
equity 1,302.7 1,245.4 1,247.1 Total liabilities and shareholders'
equity $8,654.9 $8,672.9 $8,489.6 Supplemental Balance Sheet
Information Debt less cash and marketable securities* $3,173.0
$3,338.2 $3,292.0 Working capital % of sales 2.6% 2.4% 3.4% *
Marketable securities of $16.1, $17.3 and $22.1 as of September 30,
2005, December 31, 2004 and September 30, 2004, respectively, are
included in Other current assets. Table 5 Colgate-Palmolive Company
Condensed Consolidated Statements of Cash Flows For the nine months
ended September 30, 2005 and 2004 (Dollars in Millions) (Unaudited)
2005 2004 Operating Activities Net income $990.2 $1,041.4
Adjustments to reconcile net income to net cash provided by
operations: Restructuring, net of cash 78.6 (14.7) Depreciation and
amortization 247.4 241.2 Gain before tax on sale of non-core
product lines (93.1) (26.7) Deferred income taxes 6.6 (1.2) Cash
effects of changes in: Receivables (40.8) (30.7) Inventories (74.2)
(127.8) Accounts payable and other accruals 187.6 131.2 Other
non-current assets and liabilities 3.1 17.8 Net cash provided by
operations 1,305.4 1,230.5 Investing Activities Capital
expenditures (257.8) (198.8) Payment for acquisitions, net of cash
acquired (38.5) (765.0) Sale of non-core product lines 117.0 37.0
Other 2.3 15.6 Net cash used in investing activities (177.0)
(911.2) Financing Activities Principal payments on debt (1,619.8)
(643.4) Proceeds from issuance of debt 1,623.4 1,222.2 Dividends
paid (443.1) (397.4) Purchases of treasury shares (649.5) (453.2)
Proceeds from exercise of stock options 33.1 67.6 Net cash (used
in) provided by financing activities (1,055.9) (204.2) Effect of
exchange rate changes on cash and cash equivalents (15.8) (9.8) Net
increase in Cash and cash equivalents 56.7 105.3 Cash and cash
equivalents at beginning of period 319.6 265.3 Cash and cash
equivalents at end of period $376.3 $370.6 Supplemental Cash Flow
Information Free cash flow before dividends (net cash provided by
operations less capital expenditures) Net cash provided by
operations $1,305.4 $1,230.5 Less: Capital expenditures (257.8)
(198.8) Free cash flow before dividends $1,047.6 $1,031.7 Income
taxes paid $439.1 $449.5 Table 6 Colgate-Palmolive Company Segment
Information For the three and nine months ended September 30, 2005
and 2004 (Dollars in Millions) (Unaudited) Three Months Ended Nine
Months Ended September 30, September 30, 2005 2004 2005 2004 Net
Sales Oral, Personal and Home Care North America $653.4 $623.3
$1,895.2 $1,770.7 Latin America 669.0 566.7 1,908.9 1,652.6 Europe
705.5 689.3 2,084.3 1,915.1 Asia/Africa 509.6 465.8 1,494.7 1,401.0
Total Oral, Personal and Home Care $2,537.5 $2,345.1 $7,383.1
$6,739.4 Pet Nutrition 374.3 350.6 1,109.2 1,041.5 Total Net Sales
$2,911.8 $2,695.7 $8,492.3 $7,780.9 Three Months Ended Nine Months
Ended September 30, September 30, 2005 2004 2005 2004 Operating
Profit Oral, Personal and Home Care North America $140.6 $137.2
$412.7 $409.0 Latin America 171.9 151.8 514.3 469.9 Europe 140.6
135.0 414.9 395.8 Asia/Africa 77.2 72.0 232.9 235.1 Total Oral,
Personal and Home Care 530.3 496.0 1,574.8 1,509.8 Pet Nutrition
98.9 86.8 299.7 281.6 Corporate (24.9) (45.1) (236.5) (137.6) Total
Operating Profit $604.3 $537.7 $1,638.0 $1,653.8 The Company
evaluates segment performance based on several factors, including
operating profit. The Company uses operating profit as a measure of
operating segment performance because it excludes the impact of
corporate- driven decisions related to interest expense and income
taxes. Corporate operations include research and development costs,
unallocated overhead costs, restructuring and related
implementation costs, and gains and losses on sales of
non-strategic brands and assets. Corporate operating expenses for
the three and nine months ended September 30, 2005 include $39.8
and $125.5 of charges related to the Company's 2004 Restructuring
Program, respectively. Additionally, Corporate operating expenses
for the three and nine months ended September 30, 2005 were reduced
by a $93.1 gain related to the sale of the Company's North American
detergent brands and were increased by FAS 88 pension charges of
$24.8. The nine months ended September 30, 2004 were reduced by a
$26.7 gain related to the sale of the Company's detergent
businesses in Ecuador and Peru. The impact of this gain on Total
Operating Profit for the period was largely offset by one-time
costs associated with the Company's previous restructuring
initiative and other cost reduction activities which were primarily
recorded in the operating divisions. Table 7 Colgate-Palmolive
Company - Geographic Sales Analysis Percentage Changes - Third
Quarter 2005 vs 2004 September 30, 2005 (Unaudited) COMPONENTS OF
SALES CHANGE THIRD QUARTER Pricing, 3rd Qtr 3rd Qtr Coupons, Sales
Sales Consumer & Change Change Ex-Divested Trade Region As
Reported Ex-Divestment Volume Incentives Exchange Total Company
8.0% 8.5% 5.5% 1.0% 2.0% Europe 2.5% 2.5% 4.5% -2.0% 0.0% Latin
America 18.0% 18.0% 5.5% 5.0% 7.5% Asia/Africa 9.5% 9.5% 7.0% 0.0%
2.5% Total International 9.5% 9.5% 5.5% 1.0% 3.0% North America
5.0% 7.5% 6.0% 0.5% 1.0% Total CP Products 8.0% 9.0% 6.0% 0.5% 2.5%
Hill's 7.0% 7.0% 4.0% 1.5% 1.5% COMPONENTS OF SALES CHANGE NINE
MONTHS Pricing, 9 months 9 months Coupons, Sales Sales Consumer
& Change Change Ex-Divested Trade Region As Reported
Ex-Divestment Volume Incentives Exchange Total Company 9.0% 9.5%
7.0% 0.0% 2.5% Europe 9.0% 9.0% 8.0% -2.0% 3.0% Latin America 15.5%
16.5% 8.5% 3.5% 4.5% Asia/Africa 6.5% 6.5% 5.5% -1.5% 2.5% Total
International 10.5% 11.0% 7.5% 0.0% 3.5% North America 7.0% 8.0%
7.0% 0.0% 1.0% Total CP Products 9.5% 10.0% 7.5% 0.0% 2.5% Hill's
6.5% 6.5% 3.5% 1.0% 2.0% NOTE: The June 2004 acquisition of GABA
had a 1.0% and 5.5% positive impact on the nine months sales growth
for Total Company and Europe, respectively. DATASOURCE:
Colgate-Palmolive Company CONTACT: Bina Thompson, +1-212-310-3072,
Hope Spiller, +1-212-310-2291 Web site: http://www.colgate.com/
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Colgate Palmolive (NYSE:CL)
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