Colgate-Palmolive Company (NYSE:CL) today reported worldwide Net
sales of $4,185 million in second quarter 2011, an increase of 9.5%
versus second quarter 2010. Global unit volume grew 3.0%, pricing
increased 0.5% and foreign exchange was positive 6.0%. Organic
sales (Net sales excluding foreign exchange, acquisitions and
divestments) grew 3.5%.
Net income increased 3% to $622 million in second quarter 2011
and Diluted earnings per share increased 8% to $1.26. Net income
and Diluted earnings per share in second quarter 2010 were $603
million and $1.17, respectively.
Gross profit margin was 57.4%, down 140 basis points versus the
year ago quarter, as higher material costs more than offset
benefits from cost savings from the Company’s funding-the-growth
initiatives.
Selling, general and administrative expenses increased by 10
basis points to 34.0% of net sales in second quarter 2011 from
33.9% in second quarter 2010, as worldwide advertising spending
increased 11% versus the year ago quarter to $438 million.
Advertising as a percent to sales was 10.5%, up 10 basis points
versus second quarter 2010.
Operating profit increased 2% to $968 million in second quarter
2011 compared to $948 million in second quarter 2010.
Net cash provided by operations year to date was $1,154 million
versus $1,302 million in the comparable 2010 period. Working
capital as a percentage of Net sales was 2.5%, an increase of 60
basis points versus the year ago period. The increase was primarily
due to higher accounts receivable in the quarter and higher
inventory coverage due to timing of new product launches.
As previously announced, as part of its strategy to focus on its
higher-margin oral care, personal care and pet nutrition
businesses, on June 20, 2011 Colgate completed the purchase of the
Sanex personal care brand from Unilever PLC for €672 million ($960
million). Sanex is a premium-priced personal care brand with a
distinct positioning around healthy skin and strong market share
positions in Europe.
Also as previously announced, in connection with the Sanex
acquisition, Colgate agreed to sell its laundry detergent brands in
Colombia to Unilever for approximately $215 million resulting in an
aftertax gain of approximately $130 million. The detergent sale
recently received regulatory approval and is expected to close on
or about July 29, 2011. The Company now expects that this gain will
be fully offset in the second half of 2011 as a result of the
implementation of various business realignment and other
cost-saving initiatives, further driving improvements in
effectiveness and efficiency globally.
Ian Cook, Chairman, President and Chief Executive Officer
commented, “We are pleased with our solid top and bottom line
growth this quarter with worldwide net sales, operating profit, net
income and diluted earnings per share all increasing versus year
ago, despite very sharp increases in material costs, an intense
competitive environment globally and challenging macroeconomic
conditions, particularly in developed markets.
“Pleasingly, organic sales worldwide grew 3.5% during the
quarter, driven by unit volume increases across all operating
divisions and a return to positive pricing on a global basis.
“Colgate’s global market shares in toothpaste and manual
toothbrushes are both at record highs year to date. Colgate’s share
of the global toothpaste market strengthened to 44.6% year to date,
up 0.4 share points versus year ago. Our global leadership in
manual toothbrushes also strengthened during the quarter with
Colgate’s global market share in that category reaching 31.9% year
to date, up 0.7 share points versus year ago.
“Advertising spending increased both absolutely and as a percent
to sales versus the year ago quarter, and we continue to plan for
higher levels of spending in the second half of the year versus the
first, in support of a very full pipeline of new products.
“Reflecting the significantly higher cost environment, we
continue to expect gross profit margin for the year to decline
between 80 and 100 basis points versus 2010. We continue to be
sharply focused on our aggressive funding-the-growth initiatives
and anticipate that the benefits from those programs combined with
our strategic worldwide pricing efforts will help us achieve our
profit target of mid-single digit earnings per share growth for the
year, excluding the previously disclosed charge relating to the
transition to hyperinflationary accounting in Venezuela in first
quarter 2010.”
At 11:00 a.m. ET today, Colgate will host a conference call to
elaborate on second 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 (18% of Company
Sales)
North America Net sales declined 3.0% in the second quarter.
Unit volume increased 0.5% with 4.5% lower pricing and 1.0%
positive foreign exchange. Organic sales declined 4.0% during the
quarter.
Operating profit in North America decreased 15% in the second
quarter of 2011 to $194 million, or 26.1% of Net sales. This
decrease was driven by a decrease in Gross profit as a percentage
of Net sales, and an increase in Selling, general and
administrative expenses as a percentage of Net sales. The decrease
in Gross profit as a percentage of Net sales was due to higher raw
and packaging material costs, reflecting global commodity cost
increases, and increased promotional investments reflected in the
net selling price decreases noted above. The increase in Selling,
general and administrative expenses as a percentage of Net sales
was driven by higher advertising expenses as a percentage of Net
sales.
In the U.S., new product launches including Colgate Sensitive
Multi Protection and Colgate Max Clean SmartFoam toothpastes and
the relaunch of Colgate Total toothpaste are strengthening
Colgate’s leadership in toothpaste, with its share of that market
reaching 36.0% year to date, up 0.6 share points versus year ago.
Colgate’s strength in manual toothbrushes also continued, driven by
the success of Colgate 360° Surround, Colgate 360° ActiFlex,
Colgate Total and Colgate Extra Clean manual toothbrushes.
Successful new products in the U.S. in other categories include
Softsoap brand Body Butter Strawberry Smoother body wash and
Palmolive Soft Touch with Vitamin E dish liquid.
Looking ahead in the U.S., an array of new product introductions
are planned for the balance of the year with strong advertising
supporting them and other recent new product launches. Third
quarter launches include Colgate Optic White toothpaste and manual
toothbrush, Palmolive Pomegranate dish liquid, Softsoap brand
Eucalyptus and Aloe liquid hand soap and a new line of Softsoap
brand bar soaps.
Latin America (29% of Company
Sales)
Latin America Net sales rose 17.0% during the quarter with unit
volume increasing 4.0%. Volume gains were led by Brazil, Mexico and
Colombia. Higher pricing added 6.5% and foreign exchange was
positive 6.5%. Organic sales for Latin America increased 10.5%
during the quarter.
Operating profit in Latin America increased 19% in the second
quarter of 2011 to $360 million, or 29.2% of Net sales. This
increase was due to an increase in Gross profit as a percentage of
Net sales, partially offset by an increase in Selling, general and
administrative expenses as a percentage of Net sales. The increase
in Gross profit as a percentage of Net sales was driven by higher
pricing and cost savings from the Company’s funding-the-growth
initiatives, partially offset by higher raw and packaging material
costs reflecting global commodity cost increases. The increase in
Selling, general and administrative expenses as a percentage of Net
sales was primarily due to higher advertising investment supporting
volume growth and increased logistics and overhead expenses.
Colgate’s strong leadership in oral care throughout Latin
America continues, with toothpaste market share gains led by
Venezuela, Central America and Chile. Strong sales of Colgate
Sensitive Pro-Relief, Colgate Sensitive Pro-Relief Whitening,
Colgate Total and Colgate Triple Action toothpastes contributed to
growth throughout the region. Colgate strengthened its leadership
of the manual toothbrush market throughout the region, driven by
strong sales of Colgate 360° Surround, Colgate Twister, Colgate
Triple Action and Colgate Zig Zag manual toothbrushes. In
mouthwash, Colgate’s market share is at a record high with gains
driven by Colgate Plax Whitening Tartar Control and Colgate Plax
Complete Care mouthwashes.
Products in other categories contributing to market share gains
included Palmolive Naturals Relaxing Softness Cream and Lavender
and Protex Advanced Clean bar soaps, and Lady Speed Stick
Stainguard and Speed Stick Sensitive Power deodorants.
Europe/South Pacific (20% of Company
Sales)
Europe/South Pacific Net sales increased 11.5% during the
quarter. Unit volume increased 0.5% with 2.5% lower pricing and
13.5% positive foreign exchange. Volume gains led by the United
Kingdom and Denmark were partially offset by volume declines in the
GABA business and France. Organic sales for Europe/South Pacific
declined 2.0%.
Operating profit in Europe/South Pacific decreased 8% in the
second quarter of 2011 to $170 million, or 19.8% of Net sales. This
decrease was due to a decrease in Gross profit as a percentage of
Net sales and an increase in Selling, general and administrative
expenses as a percentage of Net sales. The decrease in Gross profit
as a percentage of Net sales was due to higher raw and packaging
material costs reflecting global commodity cost increases, which
were partially offset by cost savings from the Company’s
funding-the-growth initiatives. Selling, general and administrative
expenses as a percentage of Net sales increased due to higher
advertising investments and logistics and overhead expenses.
Colgate strengthened its oral care leadership in the
Europe/South Pacific region with toothpaste share gains led by
France, Italy, Greece, Spain, Denmark and Poland. Successful
premium products driving share gains include Colgate Sensitive
Pro-Relief Whitening, elmex Sensitive Professional, Colgate Max
White One and Colgate Max Fresh Night toothpastes. In the manual
toothbrush category, Colgate 360° Surround and Meridol Halitosis
toothbrushes contributed to share gains in key countries throughout
the region.
Recent premium innovations contributing to strength in other
product categories include Colgate Max Sonic Power battery powered
toothbrush, a new line of Palmolive shower gels and liquid hand
soaps containing Mediterranean inspired fragrances and ingredients,
and the relaunch of Palmolive Aromatherapy and Thermal Spa shower
gels with multi-sensory textures.
Greater Asia/Africa (20% of Company
Sales)
Greater Asia/Africa Net sales and unit volume increased 12.0%
and 6.5%, respectively, during the quarter. Volume gains were led
by the Greater China region, India and Malaysia. Pricing was level
with the year ago quarter and foreign exchange was positive 5.5%.
Organic sales for Greater Asia/Africa increased 6.5%.
While Operating profit in Greater Asia/Africa increased 5% in
the second quarter of 2011 to $199 million driven by strong sales
growth, it decreased as a percentage of Net sales to 24.4%. This
decrease in Operating profit as a percentage of Net sales was due
to a decrease in Gross profit as a percentage to Net sales, which
was partially offset by a decrease in Selling, general and
administrative expenses as a percentage of Net sales. The decrease
in Gross profit as a percentage of Net sales was due to higher raw
and packaging material costs reflecting global commodity cost
increases, partially offset by cost savings from the Company’s
funding-the-growth initiatives. Selling, general and administrative
expenses as a percentage of Net sales decreased due to lower
advertising expense in line with the timing of new product
launches, planned for the later part of the year.
Colgate continued its toothpaste leadership in Greater Asia,
driven by market share gains in Thailand, Malaysia and Turkey.
Successful new products including Colgate Sensitive Pro-Relief and
Colgate Sensitive Pro-Relief Whitening toothpastes and the relaunch
of Colgate Total toothpaste contributed to growth throughout the
region.
Successful products contributing to growth in other categories
in the region include Colgate 360° Surround and Colgate Massager
manual toothbrushes, Colgate Plax Sensitive and Colgate Plax
Complete Care mouthwashes, Palmolive Naturals Black Orchid and
Palmolive Thermal Spa shower gels, and Lady Speed Stick and Mennen
Speed Stick Waterproof deodorants.
Hill’s (13% of Company
Sales)
Hill’s Net sales grew 9.5% during the quarter. Unit volume
increased 2.0%, pricing increased 1.5% and foreign exchange was
positive 6.0%. Volume gains led by Russia, Canada, Brazil and
Australia were partially offset by volume declines in France and
the U.S. Hill’s organic sales increased 3.5% during the
quarter.
While Hill’s Operating profit increased 5% in the second quarter
of 2011 to $140 million, it decreased as a percentage of Net sales
to 26.1%. This decrease in Operating profit as a percentage of Net
sales was due to a decrease in Gross profit as a percentage of Net
sales, partially offset by a decrease in Selling, general and
administrative expenses as a percentage of Net sales. The decrease
in Gross profit as a percentage of Net sales was due to higher raw
and packaging material costs and increased manufacturing overheads
due to increased investments in capacity, partially offset by cost
savings from the Company’s funding-the-growth initiatives and
higher pricing. Selling, general and administrative expenses
decreased as a percentage of Net sales due to lower advertising
expenses as a percentage of Net sales.
Recent new product introductions contributing to sales in the
U.S. include Science Diet Ideal Balance Canine, which combines
natural ingredients with the power of advanced nutrition in one
balanced package, Science Diet Savory Stew Canine, Science Diet Age
Defying Feline and the relaunch of Prescription Diet c/d Multicare
Feline Bladder Health with improved efficacy and taste.
New pet food products contributing to international sales
include Science Diet Senior Advanced (15 years plus) Canine and
Feline, Science Diet Sterilized Cat and the relaunch of
Prescription Diet c/d Multicare Feline Bladder Health with improved
efficacy and taste.
***
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,
Tom’s of Maine, Sanex, Ajax, Axion, Fabuloso, Soupline and
Suavitel, as well as Hill’s Science Diet and Hill’s Prescription
Diet. For more information about Colgate’s global business, visit
the Company’s web site at http://www.colgate.com. To learn more
about Colgate’s global oral health education program, Bright
Smiles, Bright Futures™, please visit http://www.colgatebsbf.com. CL-E
Substantially all market share data included in this press
release is compiled from data as measured by ACNielsen.
Cautionary Statement on Forward-Looking
Statements
This press release and the related webcast (other than
historical information) may contain forward-looking statements.
Such statements may relate, for example, to sales or unit volume
growth, organic sales growth, profit or profit margin growth,
earnings growth, financial goals, the impact of currency
devaluations or exchange controls in Venezuela, cost-reduction
plans, tax rates, new product introductions or commercial
investment levels. These statements are made on the basis of our
views and assumptions as of this time and we undertake no
obligation to update these statements. We caution 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. Investors should consult the Company’s
filings with the Securities and Exchange Commission (including the
information set forth under the caption “Risk Factors” in the
Company’s Annual Report on Form 10-K for the year ended December
31, 2010) for information about certain factors that could cause
such differences. Copies of these filings may be obtained upon
request from the Company’s Investor Relations Department or on the
Company’s web site at http://www.colgate.com.
Non-GAAP Financial Measures
The following provides information regarding the non-GAAP
financial measures used in this earnings release and/or the related
webcast:
To supplement Colgate’s condensed income 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. Operating
profit, operating profit margin, effective tax rate, net income and
earnings per share are discussed both as reported (on a GAAP basis)
and excluding the impact of the one-time charge related to the
transition to hyperinflationary accounting in Venezuela as of
January 1, 2010. Management believes these non-GAAP financial
measures provide useful supplemental 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. See “Non-GAAP Reconciliation” for
the six months ended June 30, 2011 and 2010 included with this
release for a reconciliation of these financial measures to the
related GAAP measures.
This release discusses organic sales growth, which is Net sales
growth excluding the impact of foreign exchange, acquisitions and
divestments. Management believes this measure provides investors
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 – Second Quarter 2011 vs. 2010” for a comparison
of organic sales growth to sales growth in accordance with
GAAP.
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.
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 “Condensed Consolidated Statements of Cash
Flows For the Six Months Ended June 30, 2011 and 2010” 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 second quarter
results.)
Table 1
Colgate-Palmolive Company Consolidated
Income Statements For the Three Months Ended June 30,
2011 and 2010 (in Millions Except Per Share Amounts)
(Unaudited) 2011 2010 Net sales $ 4,185 $
3,814 Cost of sales 1,781 1,572 Gross profit 2,404
2,242 Gross profit margin 57.4 % 58.8 % Selling,
general and administrative expenses 1,421 1,292 Other
(income) expense, net 15 2 Operating profit 968 948
Operating profit margin 23.1 % 24.9 % Interest expense, net
11 14 Income before income taxes 957 934 Provision
for income taxes 311 304 Effective tax rate 32.5 % 32.5 %
Net income including noncontrolling interests 646 630
Less: Net income attributable to noncontrolling interests 24 27
Net income attributable to Colgate-Palmolive Company $ 622 $
603 Earnings per common share Basic $ 1.27 $ 1.21 Diluted $
1.26 $ 1.17 Average common shares outstanding Basic 489.5
490.1 Diluted 493.3 514.7
Table 2
Colgate-Palmolive Company Consolidated Income
Statements For the Six Months Ended June 30, 2011 and
2010 (in Millions Except Per Share Amounts)
(Unaudited) 2011 2010 Net sales $ 8,179 $
7,643 Cost of sales 3,444 3,133 Gross profit 4,735
4,510 Gross profit margin 57.9 % 59.0 % Selling,
general and administrative expenses 2,825 2,647 Other
(income) expense, net 27 237 Operating profit 1,883 1,626
Operating profit margin 23.0 % 21.3 % Interest
expense, net 27 30 Income before income taxes 1,856 1,596
Provision for income taxes 603 579 Effective tax rate
32.5 % 36.3 % Net income including noncontrolling interests
1,253 1,017 Less: Net income attributable to noncontrolling
interests 55 57 Net income attributable to Colgate-Palmolive
Company $ 1,198 $ 960 Earnings per common share Basic $ 2.44
$ 1.92 Diluted $ 2.42 $ 1.86 Average common shares
outstanding Basic 491.5 491.9 Diluted 494.9 516.7
Table 3
Colgate-Palmolive Company Non-GAAP
Reconciliation For the Six Months Ended June 30, 2011
and 2010 (in Millions Except Per Share Amounts)
(Unaudited) 2011 2010
As Reported
As Reported 1
Venezuela
Hyperinflationary 2
As Adjusted
Non-GAAP 1
Other (income) expense, net $ 27 $ 237 $ 271 $ (34 )
Operating profit 1,883 1,626 (271 ) 1,897 Operating profit
margin 23.0 % 21.3 % 24.8 % Income before income taxes 1,856
1,596 (271 ) 1,867 Effective tax rate 32.5 % 36.3 % 31.0 %
Net income including noncontrolling interests 1,253 1,017
(271 ) 1,288 Net income attributable to Colgate-Palmolive
Company $ 1,198 $ 960 $ (271 ) $ 1,231 Earnings per common
share 3 Basic $ 2.44 $ 1.92 $ (0.55 ) $ 2.47 Diluted $ 2.42 $ 1.86
$ (0.52 ) $ 2.38 1
Includes a $46 pretax ($59 aftertax, $0.11
diluted earnings per share) gain related to the remeasurement of
the Venezuelan balance sheet and lower taxes on accrued but unpaid
remittances resulting from the currency devaluation in January
2010.
2
Represents the one-time charge related to
the transition to hyperinflationary accounting in Venezuela as of
January 1, 2010. This amount primarily represents the premium paid
to acquire U.S. dollar-denominated cash and bonds. Prior to January
1, 2010, these assets had been remeasured at the parallel market
rate and then translated for financial reporting purposes at the
official rate of 2.15.
3
The impact of Non-GAAP adjustments on the
basic and diluted earnings per share may not necessarily equal the
difference between "As Reported" and "As Adjusted Non-GAAP" as a
result of rounding.
Table 4
Colgate-Palmolive Company Condensed Consolidated
Balance Sheets As of June 30, 2011, December 31, 2010
and June 30, 2010 (Dollars in Millions)
(Unaudited)
June 30,
December 31,
June 30,
2011 2010 2010 Cash and cash equivalents $ 739 $ 490 $ 555
Receivables, net 1,819 1,610 1,594 Inventories 1,417 1,222 1,246
Other current assets 495 408 416 Property, plant and equipment, net
3,831 3,693 3,410 Other assets, including goodwill and intangibles
4,943 3,749 3,365 Total
assets $ 13,244 $ 11,172 $ 10,586 Total
debt 5,011 3,424 3,373 Other current liabilities 3,258 3,119 2,913
Other non-current liabilities 1,831 1,812
1,496 Total liabilities 10,100 8,355 7,782
Total Colgate-Palmolive Company shareholders' equity 2,969 2,675
2,632 Noncontrolling interests 175 142
172 Total liabilities and shareholders’ equity $
13,244 $ 11,172 $ 10,586
Supplemental Balance Sheet Information Debt less cash, cash
equivalents and marketable securities* $ 4,219 $ 2,860 $ 2,764
Working capital % of sales 2.5 % 0.3 % 1.9 % *
Marketable securities of $53, $74 and $54
as of June 30, 2011, December 31, 2010 and June 30, 2010,
respectively, are included in Other current assets.
Table 5
Colgate-Palmolive Company Condensed Consolidated
Statements of Cash Flows For the Six Months Ended
June 30, 2011 and 2010 (Dollars in Millions)
(Unaudited) Six Months Ended June 30, 2011
2010
Operating Activities Net income including
noncontrolling interests $ 1,253 $ 1,017
Adjustments to reconcile net income
including noncontrolling interests to net cash provided by
operations:
Depreciation and amortization 202 185 Venezuela hyperinflationary
transition charge - 271 Stock-based compensation expense 56 60
Deferred income taxes 46 55 Cash effects of changes in: Receivables
(153 ) (35 ) Inventories (148 ) (85 ) Accounts payable and other
accruals (50 ) (206 ) Other non-current assets and liabilities
(52 ) 40
Net cash
provided by operations
1,154 1,302
Investing Activities Capital expenditures
(225 ) (204 ) Purchases of marketable securities and investments
(80 ) (13 ) Proceeds from marketable securities and investments 171
-
Payment for acquisitions, net of cash
acquired
(960 ) - Other (17 ) 2
Net cash
used in investing activities
(1,111 ) (215 )
Financing Activities Principal
payments on debt (1,869 ) (2,514 ) Proceeds from issuance of debt
3,433 2,757 Dividends paid (568 ) (520 ) Purchases of treasury
shares (1,017 ) (978 ) Proceeds from exercise of stock options and
excess tax benefits 220 141
Net cash
provided by (used in) financing activities
199 (1,114 ) Effect of exchange rate changes on Cash and
cash equivalents 7 (18 ) Net increase
(decrease) in Cash and cash equivalents 249 (45 ) Cash and cash
equivalents at beginning of period 490 600
Cash and cash equivalents at end of period $ 739 $
555
Supplemental Cash Flow Information Free
cash flow before dividends (Net cash provided by operations less
capital expenditures) Net cash provided by operations $ 1,154 $
1,302 Less: Capital expenditures (225 ) (204 ) Free
cash flow before dividends $ 929 $ 1,098
Income taxes paid $ 513 $ 621
Table 6
Segment Information For the Three and Six Months
Ended June 30, 2011 and 2010 (Dollars in Millions)
(Unaudited) Three Months Ended
June 30,
Six Months Ended
June 30,
2011 2010 2011 2010
Net sales Oral, Personal and Home Care
North America $ 744 $ 768 $ 1,462 $ 1,521 Latin America
1,231 1,055 2,328 2,061 Europe/South Pacific 857 770 1,689 1,594
Greater Asia/Africa 816 730
1,629 1,460 Total Oral, Personal and
Home Care 3,648 3,323 7,108 6,636 Pet Nutrition 537
491 1,071 1,007
Total Net sales $ 4,185 $ 3,814 $ 8,179
$ 7,643 Three Months Ended
June 30,
Six Months Ended
June 30,
2011 2010 2011 2010
Operating profit Oral, Personal and Home
Care North America $ 194 $ 227 $ 386 $ 444 Latin America 1
360 303 686 643 Europe/South Pacific 170 184 355 375 Greater
Asia/Africa 199 189 402
378 Total Oral, Personal and Home Care 923 903
1,829 1,840 Pet Nutrition 140 134 281 275 Corporate 2
(95 ) (89 ) (227 ) (489 )
Total Operating profit
$ 968 $ 948 $ 1,883 $ 1,626
Note: The Company evaluates segment performance based on
several factors, including Operating profit.
The Company uses Operating profit as a
measure of the operating segment performance because it excludes
the impact of corporate-driven decisions related to interest
expense and income taxes.
1 Latin America Operating profit for the six months ended
June 30, 2010 includes a $46 pretax gain resulting from the
currency devaluation in Venezuela on January 8, 2010. 2
Corporate operations include stock-based compensation related to
stock options and restricted stock awards, research and development
costs, Corporate overhead costs, restructuring and related
implementation costs and gains and losses on sales of non-core
product lines and assets. In 2010, Corporate Operating profit also
includes a one-time $271 charge related to the transition to
hyperinflationary accounting in Venezuela as of January 1, 2010.
Table 7 Colgate-Palmolive Company
Geographic Sales Analysis Percentage
Changes - Second Quarter 2011 vs 2010 June 30,
2011 (Unaudited) COMPONENTS OF
SALES CHANGE COMPONENTS OF SALES CHANGE SECOND
QUARTER SIX MONTHS Pricing Pricing
2nd Qtr Coupons 6 Months Coupons
Sales 2nd Qtr Consumer & Sales 6
Months Consumer & Change Organic
Trade Change Organic Trade
Region
As Reported Sales Change
Volume Incentives
Exchange As Reported
Sales Change Volume
Incentives Exchange
Total Company 9.5 % 3.5 % 3.0 % 0.5 % 6.0 % 7.0 % 2.5 % 2.5
% 0.0 % 4.5 %
Europe/South Pacific 11.5 % (2.0 %) 0.5
% (2.5 %) 13.5 % 6.0 % (2.0 %) 0.5 % (2.5 %) 8.0 %
Latin
America 17.0 % 10.5 % 4.0 % 6.5 % 6.5 % 13.0 % 7.5 % 2.0 % 5.5
% 5.5 %
Greater Asia/Africa 12.0 % 6.5 % 6.5 % 0.0 %
5.5 % 11.5 % 7.0 % 7.5 % (0.5 %) 4.5 %
Total
International 13.5 % 5.5 % 3.5 % 2.0 % 8.0 % 10.5 % 4.5 % 3.0 %
1.5 % 6.0 %
North America (3.0 %) (4.0 %) 0.5 % (4.5
%) 1.0 % (4.0 %) (4.5 %) 0.0 % (4.5 %) 0.5 %
Total CP
Products 10.0 % 3.5 % 3.0 % 0.5 % 6.5 % 7.0 % 2.5 % 2.5 % 0.0 %
4.5 %
Hill's 9.5 % 3.5 % 2.0 % 1.5 % 6.0 % 6.5 % 2.5
% 2.5 % 0.0 % 4.0 %
Emerging Markets
(1) 15.0 % 9.0 % 5.5 % 3.5 % 6.0 % 12.5 % 7.0 % 4.5 % 2.5 %
5.5 %
Developed Markets 4.5 % (2.0 %) 0.5 % (2.5 %)
6.5 % 2.0 % (2.0 %) 0.5 % (2.5 %) 4.0 % (1) Emerging Markets
include Latin America, Greater Asia/Africa (excluding Japan) and
Central Europe.
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