How did Colgate-Palmolive's sales perform in the third quarter of 2001?

Colgate-Palmolive's worldwide net sales increased by 2.0% to $2,391.2 million in the third quarter of 2001 compared to the same period in 2000. This growth was primarily driven by a 5.5% increase in unit volume, which was partially offset by unfavorable foreign currency movements.

What was the impact of foreign currency exchange rates on the company's financial results?

Foreign currency depreciation had a negative impact on sales growth. Excluding the effect of foreign currency declines, sales would have risen by 5.0% for the third quarter. The company also noted a charge to cumulative translation adjustment in comprehensive income due to the devaluation of the Brazilian real.

How did the company's profitability change in the third quarter?

Profitability improved in the third quarter. Gross profit margin increased to 55.2% from 54.7% in the prior year, attributed to manufacturing cost streamlining and global sourcing. Selling, general, and administrative expenses as a percentage of sales also decreased to 35.3% from 36.0%. This led to an 8% increase in earnings before interest and taxes (EBIT).

What are the company's plans regarding the adoption of new accounting standards like SFAS 142?

Colgate-Palmolive plans to adopt SFAS 141 (Business Combinations) and SFAS 142 (Goodwill and Other Intangible Assets) effective January 1, 2002. Under these standards, goodwill and indefinite life intangible assets will no longer be amortized but will be subject to impairment tests. The company estimates that annual amortization expense related to goodwill and other intangibles was approximately $69 million for 2001. While this change is expected to increase net income, the company is still quantifying the full impact and its preliminary assessment suggests an impairment charge, if any, will not be material.

CL 10-Q Quarterly Report Q3 FY2001 — Revenue, Net Income, EPS

Summary

Colgate-Palmolive Company reported solid financial results for the third quarter and first nine months of 2001. Net sales showed a modest increase of 2.0% for the quarter, driven by a 5.5% unit volume gain, partially offset by foreign currency depreciation. The company demonstrated improved profitability, with gross profit margin increasing to 55.2% in the quarter and 35.3% for SG&A expenses as a percentage of sales, leading to an 8% increase in EBIT for the quarter. Net income grew by 8% to $296.2 million ($0.49 diluted EPS) for the third quarter and 10% to $851.3 million ($1.40 diluted EPS) for the nine-month period. This growth was achieved through effective cost management and operational efficiencies, including benefits from streamlining manufacturing costs and global sourcing. The company also saw positive developments in its Pet Nutrition segment and strong volume gains across several geographic regions, particularly in North America and Latin America, supported by successful product introductions.

Key Highlights

1Net sales increased 2.0% to $2,391.2 million for the third quarter of 2001, driven by a 5.5% unit volume increase.
2Diluted Earnings Per Share (EPS) rose to $0.49 for the third quarter, up from $0.44 in the prior year period.
3Net income increased by 8% to $296.2 million for the third quarter.
4Gross profit margin improved to 55.2% in the third quarter, up from 54.7% in the prior year, reflecting cost reduction initiatives.
5Selling, general, and administrative expenses as a percentage of sales decreased to 35.3% in the third quarter, indicating improved efficiency.
6The Pet Nutrition segment saw a 9.0% sales increase driven by strong volume gains and new product introductions.
7Strong volume growth was observed in North America and Latin America, supported by successful product launches in Oral Care and Personal Care categories.

COLGATE PALMOLIVE CO Quarterly Report for Q3 Ended Sep 30, 2001

Summary

Key Highlights

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