Colgate Reports Strong 2nd Quarter 
 
    NEW YORK, July 22, 2003-- Colgate-Palmolive Company (NYSE: CL) achieved all-
time records in sales, operating profit, operating profit margin, net profit 
margin, net income and earnings per share in the second quarter 2003.  Worldwide 
sales rose 7.0% during the quarter and global unit volume grew 4.5% with every 
operating division participating in the volume gains.  Operating profit reached 
an all-time high in the second quarter, up 8% over a very strong performance in 
the year ago period, reaching a record 22.7% to sales. Gross profit margin 
increased 80 basis points to 55.0%.  Net income rose 10% to a record $359.8 
million and earnings per share rose 13% to $.62 vs. $.55 in the year ago 
quarter.  This is Colgate's 29th consecutive quarter of increased net income and 
increased earnings per share. 
    Reuben Mark, Colgate's Chairman and CEO said, "It's great that the 
combination of strong top-line growth and excellent gross margin improvement 
during the quarter funded a very substantial increase in advertising worldwide 
while still generating double-digit earnings per share growth.  
    "We are especially pleased with the continuing high quality of these 
earnings as reflected throughout the P&L, balance sheet and cash flow 
statement.   
    "Colgate's already strong balance sheet continues to strengthen. Net cash 
provided by operations was up 13% to $730.3 million in the first half.  After-
tax return on capital reached 35.9% for the first half, a 380 basis point 
increase over the prior year and another all-time record.  Worldwide working 
capital was again reduced versus year ago and free cash flow before dividends 
increased 15% to $609.1 million.  Our consistently strong free cash flow 
enabled us to increase the dividend rate by 33%, effective in the second 
quarter, while simultaneously reducing debt levels. 
    "The Company's strong profitability, widespread unit volume gains and very 
full new product pipeline indicates to me that 2003 should be our eighth 
consecutive year of double-digit earnings per share growth." 
    At 11:00 a.m. eastern time today, Colgate will host a conference call to 
further elaborate on second quarter results and to discuss the Company's 
ongoing expectations.  To access this call as a webcast, please go to 
Colgate's website on the internet at www.colgate.com. 
 
    The following are comments about divisional performance: 
 
    North America (24% of Company Sales) 
    Positive growth momentum continued in North America fueled by new product 
sales and market share gains.  North American unit volume increased 7.5% in 
the second quarter, with the U.S. up 9.0%.  Sales reached a record high for 
the quarter, up 7.5% versus the year ago period, and operating profit 
increased 14%, also to a new record.  
    In the U.S., consumer takeaway of Colgate's products outpaced category 
growth in the second quarter 2003. Colgate's leadership of the U.S. toothpaste 
market expanded during the quarter with its national ACNielsen market share at 
34.5% for the second quarter, up almost two full share points from the year 
ago period.   Colgate Total, the individual brand leader in the U.S. 
toothpaste market, continues to advance achieving record shares in the first 
half of 2003.  New products driving growth include Colgate Simply White and 
Colgate Simply White Night at-home tooth whitening gels, Colgate Total Plus 
Whitening and Colgate Herbal White toothpastes, Softsoap Aromatherapy body 
wash and liquid hand soap, Palmolive Aromatherapy dishwashing liquid and 
Mennen Speed Stick 24/7 deodorant. 
    Latest introductions arriving on U.S. store shelves now are Palmolive Dish 
Wipes, the first of its kind dish wipe in the category, and Colgate Total 
Advanced Fresh toothpaste clinically proven to provide 12 hour fresh breath 
protection along with all of the therapeutic benefits consumers expect from 
Colgate Total.   
 
    Latin America (22% of Company Sales) 
    Latin American unit volume grew 2.0% in the second quarter, as expected, 
despite macro-economic and currency problems throughout the region.  Strong 
volume gains in Chile, Ecuador, Mexico, Peru and Central America were 
partially offset by volume declines in Argentina and Colombia due to economic 
slowdowns in those countries.   Dollar sales and dollar operating profit 
declined 7.5% and 11%, respectively, reflecting currency weakness in the 
region.  Excluding foreign exchange, sales rose 10% and operating profit 
increased 6%. 
    Colgate continues to expand its already strong Oral Care leadership in 
Latin America with toothpaste shares for the region at an all-time high.  
Recent introductions contributing to growth include Colgate Total Plus 
Whitening, Colgate Fresh Confidence Extreme Gel, Colgate Triple Action and 
Colgate Herbal White toothpastes, and Colgate Active Angle, Colgate Motion 
Kids and Colgate Extra Clean toothbrushes.  Colgate Simply White at-home tooth 
whitening gel was recently launched in Mexico and Panama and early sales have 
already exceeded expectations.   Standouts driving growth in other categories 
are Protex Herbal anti-bacterial soap, Caprice Color Protection and Caprice 
Anti-dandruff shampoos, and Ajax Baking Soda and Citrus and Fabuloso Baby 
Scent liquid cleaners. 
 
    Europe (24% of Company Sales) 
    Colgate Europe achieved 2.0% unit volume growth in the second quarter.  
Greece, Nordic Group, Spain, United Kingdom, Hungary, Russia, Adria, Turkey 
and Ukraine each contributed strong volume gains more than offsetting volume 
declines in Germany, which experienced very poor economic conditions and 
negative GDP growth in the period.  Dollar sales in Europe rose 18.0%, 
reflecting the combination of volume growth and favorable foreign exchange.  
Dollar operating profit increased 29% and operating profit in local currencies 
increased 11%.   
    In Western Europe, successful new products gaining market share include 
Colgate Sensitive, Colgate Total Plus Whitening and Colgate Triple Action 
toothpastes, Palmolive Aromatherapy Sensual scent shower gel and bath foam, 
Palmolive Aromatherapy bar soap, Palmolive Oxygen dishwashing liquid, Ajax 
Minerals all-purpose cleaners and Soupline Water Petals fabric conditioner. 
    New products driving growth throughout Central Europe and Russia include 
Colgate Triple Action, Colgate Total Plus Whitening and Colgate Herbal White 
toothpastes, Colgate Active Angle and Colgate Extra Clean toothbrushes, and 
Palmolive Aromatherapy shower gel and bath foam. 
 
    Asia/Africa (17% of Company Sales) 
    Asia/Africa unit volume grew 6.0% in the second quarter.  Healthy volume 
increases were achieved by Australia, China, Hong Kong, Malaysia, Morocco, New 
Zealand, Philippines, Senegal, South Africa, Thailand and Vietnam.  Dollar 
sales grew 11.5% in the second quarter and dollar operating profit increased 
21% to an all-time record level.  Excluding the impact of exchange, second 
quarter sales rose 4% and operating profit increased 14%. 
    Successful new products driving Oral Care growth in the region include 
Colgate Herbal and Colgate Herbal White toothpastes, Colgate Navigator Plus 
and Colgate Premier Ultra toothbrushes and the continued rollout of Colgate 
Simply White at-home tooth whitening gel in Hong Kong, the South Pacific and 
now China, where it is scheduled to reach over 900 retail outlets during 3rd 
quarter 2003.  Other new products gaining market share in key categories are 
Palmolive Aromatherapy shower gel and talc, Protex Herbal soap, Softlan 
Jasmine scent fabric conditioner and Palmolive Naturals shampoo. 
 
    Hill's Pet Nutrition (13% of Company Sales) 
    Innovative new products and veterinary endorsements continue to drive 
growth at Hill's, the world leader in premium pet food.  Dollar sales 
increased 11.5% and unit volume grew 4.5% in the second quarter.  Hill's 
achieved strong volume and market share gains during the quarter, both 
domestically and internationally.  Dollar operating profit increased 5% after 
record levels of commercial and media investment during the quarter and on top 
of a very strong performance in the year ago period.   Excluding foreign 
exchange, sales rose 7% and operating profit increased 1% in the quarter.  In 
the first half, Hill's sales and operating profit excluding exchange rose 8% 
and 10%, respectively. 
    Hill's increased consumption of Science Diet and Prescription Diet in the 
U.S. specialty retail channel, where its growth continues to outpace category 
growth.  Hill's Science Diet Nature's Best continues to contribute incremental 
volume and market share gains, supported with targeted promotional and media 
spending during the quarter.  Other innovative new products recently announced 
for launch in the second half 2003 are Science Diet Advanced Protection, a 
diet shown to increase vitality and alertness in cats and dogs, and 
Prescription Diet m/d, a low carbohydrate diet clinically proven to alter 
metabolism for effective weight loss in cats.  
    Internationally, Australia, Belgium, France, Greece, Hong Kong, South 
Korea, Spain, Switzerland and Russia each contributed strong volume gains in 
the second quarter.  The strong international results were driven by the 
launch of Nature's Best across Europe, which was supported by heavy 
promotional spending during the quarter including high quality merchandising 
materials and effective in-store displays.   
 
                                    * * * 
 
    About Colgate-Palmolive: Colgate-Palmolive is a leading global consumer 
products company, tightly focused on Oral Care, Personal Care, Household 
Surface Care, Fabric Care and Pet Nutrition.  Colgate sells its products in 
over 200 countries and territories around the world under such internationally 
recognized brand names as Colgate, Palmolive, Mennen, Softsoap, Irish Spring, 
Protex, Sorriso, Kolynos, Ajax, Axion, Soupline, Suavitel and Fab, as well as 
Hill's Science Diet and Hill's Prescription Diet pet foods.  For more 
information about Colgate's global business, visit the Company's website at 
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, 
2002) 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 website on the internet at 
www.colgate.com. 
 
              (See attached tables for second quarter results.) 
                                        
 
    Colgate-Palmolive Company Condensed Consolidated Statements of Income 
     
         For the three months and six months ended June 30, 2003 and 2002 
     
            (Dollars in Millions Except Per Share Amounts) (Unaudited) 
     
                                      Second Quarter        First Half 
                                      2003      2002      2003      2002 
     
    Net Sales                       $2,458.6  $2,297.0  $4,807.0  $4,492.2 
     
    Cost of Sales                    1,105.8   1,053.0   2,156.0   2,045.4 
     
    Gross Profit                     1,352.8   1,244.0   2,651.0   2,446.8 
     
    Gross Profit Margin                55.0%     54.2%     55.1%     54.5% 
     
    Selling, General & Administrative  
     Expenses                          795.3     726.2   1,583.0   1,468.3 
     
    Operating Profit                   557.5     517.8   1,068.0     978.5 
     
    Operating Profit Margin            22.7%     22.5%     22.2%     21.8% 
     
    Net Interest Expense                31.3      37.1      65.3      72.0 
     
    Income Before Income Taxes         526.2     480.7   1,002.7     906.5 
     
    Provision for Income Taxes         166.4     153.7     318.9     289.8 
     
    Effective Tax Rate                 31.6%     32.0%     31.8%     32.0% 
     
    Net Income                         359.8     327.0     683.8     616.7 
     
    Net Earnings Per Common Share 
       Basic                            $.66      $.59     $1.25     $1.11 
       Diluted                          $.62      $.55     $1.18     $1.04 
     
    Average Common Shares Outstanding 
       Basic                           538.0     545.0     537.6     547.1 
       Diluted                         580.6     591.8     580.0     594.5 
 
 
     
         Colgate-Palmolive Company Condensed Consolidated Balance Sheets 
     
            As of June 30, 2003, December 31, 2002 and June 30, 2002 
     
           (Dollars in Millions Except Per Share Amounts) (Unaudited) 
     
     
                                            June 30,   December 31,   June 30, 
                                              2003         2002         2002 
     
       Cash and marketable securities         $226.1      $177.5      $255.4 
       Accounts receivable, net              1,196.0     1,145.4     1,164.6 
       Inventories                             770.9       671.7       713.5 
       Other current assets                    250.0       233.5       224.1 
       Property, plant and equipment, net    2,517.5     2,491.3     2,456.7 
       Other assets, including goodwill   
        and intangibles                      2,466.2     2,367.8     2,319.9 
          Total assets                      $7,426.7    $7,087.2    $7,134.2 
     
       Total debt                            3,459.3     3,603.9     3,773.7 
       Other current liabilities             1,861.9     1,755.6     1,677.7 
       Other non-current liabilities         1,391.9     1,377.4     1,210.2 
       Total shareholders' equity              713.6       350.3       472.6 
          Total liabilities and         
           shareholders' equity             $7,426.7    $7,087.2    $7,134.2 
     
       Supplemental Balance Sheet Information: 
       Debt less cash and marketable      
        securities                          $3,233.2    $3,426.4    $3,518.3 
       Working capital % of sales               3.6%        3.2%        4.6% 
       After-tax return on capital             35.9%       34.6%       32.1% 
 
    
 
    Colgate-Palmolive Company Condensed Consolidated Statements of Cash Flows 
     
                 For the six months ended June 30, 2003 and 2002 
     
           (Dollars in Millions Except Per Share Amounts) (Unaudited) 
     
     
                                                     2003              2002 
     
    Operating Activities: 
      Net income                                    $683.8            $616.7 
      Depreciation and amortization                  153.6             145.2 
      Voluntary contributions to     
       benefit plans                                 (63.1)            (50.0) 
      Deferred income taxes                           (1.0)            (14.6) 
      Changes in: 
         Accounts receivable                          (9.3)             (5.0) 
         Inventories                                 (73.1)            (41.6) 
         Accounts payable and other accruals           8.2              12.9 
         Other non-current assets and            
          liabilities                                 31.2             (14.5) 
           Net cash provided by operations           730.3             649.1 
     
    Investing Activities: 
         Capital expenditures                       (121.2)           (121.6) 
         Other investing activities                   45.4             (21.8) 
           Net cash used in investing   
            activities                               (75.8)           (143.4) 
     
    Financing Activities: 
         (Payments on) proceeds from    
          debt issuances                            (196.5)            390.5 
         Dividends paid                             (237.0)           (207.8) 
         Purchases of treasury shares               (235.8)           (648.4) 
         Other                                        63.7              33.7 
           Net cash used in financing  
            activities                              (605.6)           (432.0) 
     
    Effect of exchange rate changes on    
     cash and cash equivalents                         2.4               1.0 
    Net increase in cash and cash         
     equivalents                                      51.3              74.7 
    Cash and cash equivalents at          
     beginning of period                             167.9             172.7 
    Cash and cash equivalents at end of   
     period                                         $219.2            $247.4 
     
    Supplemental Cash Flow Information: 
    Free cash flow before dividends (net  
     cash provided by operations less     
     capital expenditures)                          $609.1            $527.5 
 
SOURCE  Colgate-Palmolive Company 
    -0-                             07/22/2003 
    /CONTACT:  Bina Thompson, +1-212-310-3072, or Hope Spiller,  
+1-212-310-2291, both of Colgate-Palmolive Company/ 
    /Web site:  http://www.colgate.com/ 
    (CL) 
 





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