NEW YORK, Jan. 25, 2006 /PRNewswire-FirstCall/ -- Colgate-Palmolive
Company (NYSE:CL) today announced a continuation of the strong
momentum that built throughout 2005. All operating divisions
experienced volume growth. Sales and unit volume, as reported
including divestments, grew 3.5% and 2.5%, respectively. Worldwide
sales, excluding divestments, were up 5.5% on unit volume growth of
4.5%, on top of 9.0% volume growth in the year ago quarter. Global
pricing rose 2.0%, the largest increase in 21 quarters, and foreign
exchange was negative 1.0%. As previously disclosed and consistent
with its focused business strategy, the Company sold its heavy-duty
laundry detergent brands in Southeast Asia at the end of the fourth
quarter for an after-tax gain of $32.9 million. This gain was more
than offset by $41.9 million of after-tax charges associated with
the Company's 2004 Restructuring Program and $10.4 million of
incremental income taxes for already disclosed remittances under
the American Jobs Creation Act and a one-time, non-cash
international postretirement charge. Fourth quarter 2005 reported
net income and diluted earnings per share were $361.2 million and
$.65, respectively, including the restructuring charge and other
items noted above. Excluding these items, net income for the
quarter was $380.6 million and diluted earnings per share for the
quarter were $.69, up 14% and 17%, respectively, versus fourth
quarter 2004. In fourth quarter 2004, reported net income and
diluted earnings per share were $285.7 million and $.50,
respectively, and net income and diluted earnings per share
excluding restructuring charges were $333.7 million and $.59,
respectively. As reported, gross profit margin in the fourth
quarter was 54.6%. Excluding restructuring charges, gross profit
margin was 56.0%, an all-time record and a 100 basis point
improvement versus the year ago quarter. Operating profit as
reported increased 23% versus fourth quarter 2004. Excluding the
restructuring charge and other items noted above, operating profit
increased 10% versus fourth quarter 2004. Global advertising
supporting Colgate's brands of $306.4 million was a fourth quarter
record level, led by a strong double-digit increase in worldwide
media. The Company's reported tax rate in fourth quarter 2005 was
33.1%. Consistent with previous guidance, the effective tax rate
excluding the restructuring charge and other items noted was 31.1%.
Net cash provided by operations for the year after restructuring
spending and tax payments on one-time brand sales, increased to
$1,784.4 million, up 2% versus prior year. Year-end working capital
improved versus year ago to 1.7% of sales. Reuben Mark, Chairman
and CEO said, "We are delighted to end 2005 with an extension of
the excellent bottom line growth momentum we have seen building
throughout the year, and which we expect to see continue in 2006."
Ian Cook, President and COO further commented, "We are especially
encouraged by the 2.0% increase in global pricing, led by Latin
America, North America and Hill's, despite challenging competitive
environments everywhere." Mr. Mark continued, "Colgate's market
shares are strong and getting stronger both here in the U.S. and
abroad. In fact, Colgate's global market share for toothpaste and
manual toothbrushes both increased and are at all-time record
highs. "It's great to see we are back on track with strong gross
profit margin increases. The excellent 100 basis point improvement
in gross profit margin excluding restructuring charges during the
quarter exceeded our expectations, and was the largest quarterly
gross profit increase we have seen in three years. This increase
combined with a reduction in overhead expenses allowed us to build
our overall profitability while still investing in even stronger
levels of advertising behind our global brands. "Looking forward,
we expect our growth momentum to continue as we enter 2006. We are
confident that, excluding restructuring charges and accounting
changes for stock-based compensation, we will generate double-digit
earnings per share growth in 2006, beginning in the first quarter."
For the full year 2005, worldwide sales as reported increased 7.5%
to an all-time high including 1.5% foreign exchange and 0.5%
positive pricing. Global sales and global unit volume grew 8.5% and
6.5%, respectively, excluding divestments. The June 2004
acquisition of GABA contributed 1.0% to both sales and volume. As
reported, net income and diluted earnings per share for the full
year 2005 were $1,351.4 million and $2.43, respectively. As
previously disclosed, the Company sold its heavy-duty laundry
detergent brands in North America and Southeast Asia during the
year for a combined after-tax gain of $93.5 million. This gain was
more than offset by $145.1 million of after-tax charges associated
with the Company's previously announced 2004 Restructuring Program,
$40.9 million of income taxes for incremental repatriation of
foreign earnings related to the American Jobs Creation Act and
$22.7 million after-tax of one- time, non-cash postretirement
charges. Excluding restructuring charges and other items noted
above, net income and diluted earnings per share for full year 2005
increased 7% and 9%, respectively, versus 2004 excluding
restructuring charges. At 11:00 a.m. ET today, Colgate will host a
conference call to elaborate on fourth 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 (21% of
Company Sales) Strong growth continued in North America, fueled by
new product sales and market share gains. Sales and unit volume in
the quarter, excluding divestments, grew 8.5% and 6.0%,
respectively, on top of very strong growth in the year ago period.
Sales as reported rose only 1.0% during the quarter because of the
year-on-year impact of the divestment of Colgate's U.S. detergent
business. Positive foreign exchange added 0.5% while pricing
increased 2.0%. This is the fifth consecutive quarter of sequential
price improvement in North America. North American operating profit
increased 10% as strong volume growth and gross margin improvement
more than offset higher advertising spending during the quarter and
higher raw and packaging material costs. Colgate's U.S. toothpaste
leadership market share continued to grow, with its ACNielsen
market share reaching 35.3% year to date, up 40 basis points versus
the year ago period. In the U.S., new products are generating
strong volume and market share growth. Key categories gaining
market share for the year include toothpaste, manual and powered
toothbrushes, hand dishwashing liquid, bar soap and fabric
conditioners. In Oral Care, Colgate Total toothpaste achieved
strong growth on top of a strong performance in the year ago
period. Colgate Luminous and Colgate Max Fresh toothpastes and
Colgate 360 Degree manual toothbrush also contributed to gains
during the quarter. New products contributing to growth in other
categories include Ajax Ruby Red Grapefruit and Palmolive Oxy Plus
dish liquids, Irish Spring MicroClean bar soap, and Softsoap
Kitchen Fresh Hands and Softsoap Shea Butter liquid hand soaps.
Strong new product activity is planned for 2006. New introductions
planned for launch during first quarter 2006 include Softsoap Pure
Cashmere moisturizing body wash, Palmolive Odor Eliminator dish
liquid, Speed Stick deodorant with Irish Spring scents and a
relaunch of the entire line of Softsoap body washes with an
improved formula and new packaging. Latin America (24% of Company
Sales) Latin American sales grew 16.5% in the fourth quarter to an
all-time record level. Unit volume for the region grew 5.0%, with
nearly every country in the region contributing to growth. Sales
growth was especially strong in Venezuela, Brazil, Mexico,
Dominican Republic, Central America, Colombia and Argentina.
Positive foreign exchange added 6.0% and pricing increased 5.5%.
Latin American operating profit increased 16%, even after a strong
double- digit increase in advertising behind its market leading
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 Chile and Central America. New
products contributing to these gains include Colgate Max Fresh and
Colgate Sensitive toothpastes 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. Other new
products driving growth in Latin America are Colgate MicroSonic
battery-powered toothbrush, Colgate Smiles line of manual
toothbrushes for kids, Palmolive Nutri-Milk and Protex Oats bar
soaps, and Lady Speed Stick and Speed Stick multiform deodorants.
Europe (23% of Company Sales) European unit volume grew 2.5% in the
fourth quarter, excluding divestments, on top of a very strong
performance in the year ago quarter. Strong volume gains in the
United Kingdom, Ireland, Denmark, Spain, Russia, Turkey, Ukraine,
Romania, Adria, Poland and the Baltic States more than offset
challenging economic conditions in Italy, France and Germany. The
GABA oral care business continues to perform ahead of expectations,
achieving strong unit volume growth and operating profit for the
quarter. European sales, excluding divestments, declined 5.5% as
the positive unit volume growth was more than offset by 6.5%
negative foreign exchange and decreased pricing of 1.5%. As
reported, European sales declined 7.0% and unit volume grew 1.0%.
Operating profit for the region decreased 8% versus the all-time
record level achieved in the year ago quarter. Virtually all of the
decline was due to a 6.5% decrease in European currency value.
Colgate strengthened its oral care leadership in Western Europe
with regional market shares in toothpaste and manual toothbrushes
both increasing for the year. 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
Naturals with Olive Milk and Palmolive Thermal Spa Firming shower
gels and Ajax Professional Degreaser spray cleaner. Throughout
Central Europe and Russia, Colgate has continued to expand 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,
Poland and Ukraine. Share gains in the region were driven by strong
sales of Colgate Total, Colgate Cavity Protection Extra Mint and
Colgate Sensitive toothpastes as well as the launch of Colgate Max
Fresh toothpaste in both tube and liquid form. Colgate also
strengthened its leadership position in manual 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 Colgate Smiles line of
manual toothbrushes for kids. New products contributing to growth
in other categories include Lady Speed Stick and Speed Stick
multiform deodorants and Palmolive Naturals with Olive Milk shower
gel and liquid hand soap. Asia/Africa (18% of Company Sales)
Asia/Africa sales and unit volume grew 5.0% and 6.0%, respectively,
on top of strong growth in the year ago quarter. Volume gains were
achieved in China, India, Hong Kong, Malaysia, Thailand, Australia,
Taiwan, Vietnam and South Africa. Pricing increased 0.5% and
foreign exchange was negative 1.5%. Operating profit for the region
increased 13% to an all-time record level, even after a record
level of advertising behind Colgate brands during the quarter.
Colgate strengthened its oral care leadership in the Asia Pacific
region led by toothpaste market share gains in China, India, 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 Colgate Vitamin C Fresh 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, Protex Sun Care bar soap and
Palmolive Naturals shampoo and conditioner. Hill's (14% 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 5.0% in the fourth quarter and dollar sales rose
5.0% reflecting 2.5% higher pricing offset by negative foreign
exchange of 2.5%. Operating profit increased 5% to an all-time
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 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, South
Africa, New Zealand, Spain, Russia, Belgium and Switzerland. New
products contributing to growth include Science Diet Canine Senior
Large Breed, Prescription Diet Canine j/d, Prescription Diet Canine
z/d, Prescription Diet Feline z/d and the relaunch of Prescription
Diet Canine d/d with an upgraded formulation. * * * 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/. The Company's annual meeting of
shareholders is currently scheduled for Thursday, May 4, 2006. 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 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, which pertain to 2005, is
comprised of gains on the sale of the Company's heavy-duty laundry
detergent businesses in North America and Southeast Asia,
incremental income taxes for the previously disclosed remittances
under the American Jobs Creation Act and charges associated with
certain pension and other postretirement obligations in accordance
with Statement of Financial Accounting Standards (SFAS) No. 88,
"Employers' Accounting for Settlement and Curtailments of Defined
Benefit Pension Plans and for Termination Benefits" and SFAS No.
106 "Employers' Accounting for Postretirement Benefits Other Than
Pensions". The amount of each such Other 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 December 31, 2005 and 2004 and for the years
ended December 31, 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 - Fourth Quarter and Full Year
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. (See attached tables for fourth quarter results.) 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
December 31, 2005 and 2004 (Dollars in Millions Except Per Share
Amounts) (Unaudited) 2005 Excluding Restructuring Restructuring As
Reported & Other(a) & Other Net sales $2,904.6 $ - $2,904.6
Cost of sales 1,319.9 40.7 1,279.2 Gross profit 1,584.7 (40.7)
1,625.4 Gross profit margin 54.6% 56.0% Selling, general and
administrative expenses 1,010.3 1.3 1,009.0 Other (income) expense,
net (2.6) (30.3) 27.7 Operating profit 577.0 (11.7) 588.7 Operating
profit margin 19.9% 20.3% Interest expense, net 36.7 - 36.7 Income
before income taxes 540.3 (11.7) 552.0 Provision for income taxes
179.1 7.7 171.4 Effective tax rate 33.1% 31.1% Net income 361.2
(19.4) 380.6 Earnings per common share Basic $0.68 $(0.04) $0.72
Diluted $0.65 $(0.04) $0.69 Average common shares outstanding Basic
517.2 517.2 517.2 Diluted 552.8 552.8 552.8 (a) See Supplemental
Consolidated Income Statement Information - Components of 2004
Restructuring Program and Other Items for details. 2004 Excluding
As Reported Restructuring Restructuring Net sales $2,803.3 $ -
$2,803.3 Cost of sales 1,266.2 3.4 1,262.8 Gross profit 1,537.1
(3.4) 1,540.5 Gross profit margin 54.8% 55.0% Selling, general and
administrative expenses 1,003.1 - 1,003.1 Other (income) expense,
net 65.7 65.3 0.4 Operating profit 468.3 (68.7) 537.0 Operating
profit margin 16.7% 19.2% Interest expense, net 32.0 - 32.0 Income
before income taxes 436.3 (68.7) 505.0 Provision for income taxes
150.6 (20.7) 171.3 Effective tax rate 34.5% 33.9% Net income 285.7
(48.0) 333.7 Earnings per common share Basic $0.53 $(0.09) $0.62
Diluted $0.50 $(0.09) $0.59 Average common shares outstanding Basic
528.5 528.5 528.5 Diluted 565.9 565.9 565.9 Table 2
Colgate-Palmolive Company Consolidated Income Statement and
Supplemental Information Reconciliation Excluding the 2004
Restructuring Program and Other Items For the Years Ended December
31, 2005 and 2004 (Dollars in Millions Except Per Share Amounts)
(Unaudited) 2005 Excluding Restructuring Restructuring As Reported
& Other(a) & Other Net sales $11,396.9 $ - $11,396.9 Cost
of sales 5,191.9 100.2 5,091.7 Gross profit 6,205.0 (100.2) 6,305.2
Gross profit margin 54.4% 55.3% Selling, general and administrative
expenses 3,920.8 1.8 3,919.0 Other (income) expense, net 69.2
(33.1) 102.3 Operating profit 2,215.0 (68.9) 2,283.9 Operating
profit margin 19.4% 20.0% Interest expense, net 136.0 - 136.0
Income before income taxes 2,079.0 (68.9) 2,147.9 Provision for
income taxes 727.6 46.3 681.3 Effective tax rate 35.0% 31.7% Net
income 1,351.4 (115.2) 1,466.6 Earnings per common share Basic
$2.54 $(0.22) $2.76 Diluted $2.43 $(0.21) $2.64 Average common
shares outstanding Basic 520.5 520.5 520.5 Diluted 556.5 556.5
556.5 (a) See Supplemental Consolidated Income Statement
Information - Components of 2004 Restructuring Program and Other
Items for details. 2004 Excluding As Reported Restructuring
Restructuring Net sales $10,584.2 $ - $10,584.2 Cost of sales
4,747.2 3.4 4,743.8 Gross profit 5,837.0 (3.4) 5,840.4 Gross profit
margin 55.1% 55.2% Selling, general and administrative expenses
3,624.6 - 3,624.6 Other (income) expense, net 90.3 65.3 25.0
Operating profit 2,122.1 (68.7) 2,190.8 Operating profit margin
20.0% 20.7% Interest expense, net 119.7 - 119.7 Income before
income taxes 2,002.4 (68.7) 2,071.1 Provision for income taxes
675.3 (20.7) 696.0 Effective tax rate 33.7% 33.6% Net income
1,327.1 (48.0) 1,375.1 Earnings per common share Basic $2.45
$(0.09) $2.54 Diluted $2.33 $(0.09) $2.42 Average common shares
outstanding Basic 530.9 530.9 530.9 Diluted 569.3 569.3 569.3 Table
3 Colgate-Palmolive Company Supplemental Consolidated Income
Statement Information Components of 2004 Restructuring Program and
Other Items (Dollars in Millions) (Unaudited) Three Months Ended
December 31, 2005 Tax on Incremental 2004 Gain on Postretirement
Remittances Restructuring Detergent Charges (AJCA) Total Program
Sales Restructuring & Other Net sales $ - $ - $ - $ - $ - Cost
of sales 40.7 - - - 40.7 Gross profit (40.7) - - - (40.7) Selling,
general and administrative expenses 1.3 - - - 1.3 Other (income)
expense, net 15.3 (54.8) 9.2 - (30.3) Operating profit (57.3) 54.8
(9.2) - (11.7) Interest expense, net - - - - - Income before income
taxes (57.3) 54.8 (9.2) - (11.7) Provision for income taxes (15.4)
21.9 (3.2) 4.4 7.7 Net income (41.9) 32.9 (6.0) (4.4) (19.4) Year
Ended December 31, 2005 Tax on Incremental 2004 Gain on
Postretirement Remittances Restructuring Detergent Charges (AJCA)
Total Program Sales Restructuring & Other Net sales $ - $ - $ -
$ - $ - Cost of sales 100.2 - - - 100.2 Gross profit (100.2) - - -
(100.2) Selling, general and administrative expenses 1.8 - - - 1.8
Other (income) expense, net 80.8 (147.9) 34.0 - (33.1) Operating
profit (182.8) 147.9 (34.0) - (68.9) Interest expense, net - - - -
- Income before income taxes (182.8) 147.9 (34.0) - (68.9)
Provision for income taxes (37.7) 54.4 (11.3) 40.9 46.3 Net income
(145.1) 93.5 (22.7) (40.9) (115.2) Table 4 Colgate-Palmolive
Company Condensed Consolidated Balance Sheets As of December 31,
2005 and 2004 (Dollars in Millions) (Unaudited) December 31,
December 31, 2005 2004 Cash and cash equivalents $340.7 $319.6
Receivables, net 1,309.4 1,319.9 Inventories 855.8 845.5 Other
current assets 251.2 254.9 Property, plant and equipment, net
2,544.1 2,647.7 Other assets, including goodwill and intangibles
3,205.9 3,285.3 Total assets $8,507.1 $8,672.9 Total debt 3,446.2
3,675.1 Other current liabilities 2,214.8 2,145.1 Other non-current
liabilities 1,496.0 1,607.3 Total shareholders' equity 1,350.1
1,245.4 Total liabilities and shareholders' equity $8,507.1
$8,672.9 Supplemental Balance Sheet Information Debt less cash and
marketable securities* $3,095.2 $3,338.2 Working capital % of sales
1.7% 2.4% * Marketable securities of $10.3 and $17.3 as of December
31, 2005 and 2004, respectively, are included in Other current
assets. Table 5 Colgate-Palmolive Company Condensed Consolidated
Statements of Cash Flows For the Years Ended December 31, 2005 and
2004 (Dollars in Millions) (Unaudited) 2005 2004 Operating
Activities Net income $1,351.4 $1,327.1 Adjustments to reconcile
net income to net cash provided by operations: Restructuring, net
of cash 111.6 38.3 Depreciation and amortization 329.3 327.8 Gain
before tax on sale of non-core product lines (147.9) (26.7)
Deferred income taxes 30.8 57.7 Cash effects of changes in:
Receivables (24.1) (5.6) Inventories (46.8) (76.1) Accounts payable
and other accruals 193.8 109.4 Other non-current assets and
liabilities (13.7) 2.4 Net cash provided by operations 1,784.4
1,754.3 Investing Activities Capital expenditures (389.2) (348.1)
Payment for acquisitions, net of cash acquired (38.5) (800.7) Sale
of non-core product lines 215.6 37.0 Other (8.6) 21.4 Net cash used
in investing activities (220.7) (1,090.4) Financing Activities
Principal payments on debt (2,100.3) (753.9) Proceeds from issuance
of debt 2,021.9 1,246.5 Payments to outside investors (89.7) -
Dividends paid (607.2) (536.2) Purchases of treasury shares (796.2)
(637.9) Proceeds from exercise of stock options 47.1 70.4 Net cash
used in financing activities (1,524.4) (611.1) Effect of exchange
rate changes on cash and cash equivalents (18.2) 1.5 Net increase
in Cash and cash equivalents 21.1 54.3 Cash and cash equivalents at
beginning of period 319.6 265.3 Cash and cash equivalents at end of
period $340.7 $319.6 Supplemental Cash Flow Information Free cash
flow before dividends (net cash provided by operations less capital
expenditures) Net cash provided by operations $1,784.4 $1,754.3
Less: Capital expenditures (389.2) (348.1) Free cash flow before
dividends $1,395.2 $1,406.2 Income taxes paid $597.8 $593.8 Table 6
Colgate-Palmolive Company- Segment Information For the Three Months
and Years Ended December 31, 2005 and 2004 (Dollars in Millions)
(Unaudited) Three Months Ended Years Ended December 31, December
31, 2005 2004 2005 2004 Net Sales Oral, Personal and Home Care
North America $614.6 $608.0 $2,509.8 $2,378.7 Latin America 714.9
613.4 2,623.8 2,266.0 Europe 655.1 706.2 2,739.4 2,621.3
Asia/Africa 509.0 484.1 2,003.7 1,885.1 Total Oral, Personal and
Home Care $2,493.6 $2,411.7 $9,876.7 $9,151.1 Pet Nutrition 411.0
391.6 1,520.2 1,433.1 Total Net Sales $2,904.6 $2,803.3 $11,396.9
$10,584.2 Three Months Ended Years Ended December 31, December 31,
2005 2004 2005 2004 Operating Profit Oral, Personal and Home Care
North America $133.0 $121.1 $545.7 $530.1 Latin America 183.7 157.8
698.0 627.7 Europe 132.4 143.2 547.3 539.0 Asia/Africa 85.1 75.0
318.0 310.1 Total Oral, Personal and Home Care 534.2 497.1 2,109.0
2,006.9 Pet Nutrition 113.1 108.1 412.8 389.7 Corporate (70.3)
(136.9) (306.8) (274.5) Total Operating Profit $577.0 $468.3
$2,215.0 $2,122.1 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 twelve months ended December
31, 2005 include $57.3 and $182.8 of charges related to the
Company's 2004 Restructuring Program, respectively. Additionally,
Corporate operating expenses for the three and twelve months ended
December 31, 2005 were reduced by $54.8 and $147.9 of gains related
to the sales of the Company's detergent brands in North America and
Southeast Asia, respectively, and the twelve months ended December
31, 2005 were increased by FAS 88 pension charges of $24.8. Latin
American operating profit for the three and twelve months ended
December 31, 2005 were reduced by a one-time charge of $9.2
associated with a postretirement obligation. Corporate operating
expenses for the three and twelve months ended December 31, 2004
include $68.7 of charges related to the Company's 2004
Restructuring Program. Additionally, the twelve months ended
December 31, 2004 were reduced by a gain of $26.7 related to the
sale of the Company's detergent businesses in Ecuador and Peru.
Table 7 Colgate-Palmolive Company- Geographic Sales Analysis
Percentage Changes - Fourth Quarter and Full Year 2005 vs 2004
December 31, 2005 (Unaudited) COMPONENTS OF SALES CHANGE FOURTH
QUARTER 4th 4th Quarter Quarter Pricing, Sales Sales Coupons,
Change Change Ex- Consumer & As Ex- Divested Trade Reported
Divestment Volume Incentives Exchange Region Total Company 3.5%
5.5% 4.5% 2.0% -1.0% Europe -7.0% -5.5% 2.5% -1.5% -6.5% Latin
America 16.5% 16.5% 5.0% 5.5% 6.0% Asia/Africa 5.0% 5.0% 6.0% 0.5%
-1.5% Total International 4.0% 5.0% 4.5% 1.5% -1.0% North America
1.0% 8.5% 6.0% 2.0% 0.5% Total CP Products 3.5% 5.5% 4.5% 1.5%
-0.5% Hill's 5.0% 5.0% 5.0% 2.5% -2.5% COMPONENTS OF SALES CHANGE
TWELVE MONTHS 12 Months 12 Months Quarter Quarter Pricing, Sales
Sales Coupons, Change Change Ex- Consumer & As Ex- Divested
Trade Reported Divestment Volume Incentives Exchange Region Total
Company 7.5% 8.5% 6.5% 0.5% 1.5% Europe 4.5% 5.0% 6.5% -2.0% 0.5%
Latin America 16.0% 16.5% 7.5% 4.0% 5.0% Asia/Africa 6.5% 6.5% 6.0%
-1.0% 1.5% Total International 9.0% 9.0% 6.5% 0.5% 2.0% North
America 5.5% 8.0% 6.5% 0.5% 1.0% Total CP Products 8.0% 9.0% 6.5%
0.5% 2.0% Hill's 6.0% 6.0% 4.0% 1.5% 0.5% NOTE: The June 2004
acquisition of GABA had a 1.0% and 4.0% positive impact on the
twelve months sales growth for Total Company and Europe,
respectively. First Call Analyst: FCMN Contact: DATASOURCE:
Colgate-Palmolive Company CONTACT: Bina Thompson, +1-212-310-3072,
or Hope Spiller, +1-212-310- 2291, both of Colgate-Palmolive Web
site: http://www.colgate.com/
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