10-QPeriod: Q2 FY2009

COLGATE PALMOLIVE CO Quarterly Report for Q2 Ended Jun 30, 2009

Filed July 30, 2009For Securities:CL

Summary

Colgate-Palmolive Co. (CL) reported its second-quarter and first-half results for 2009, demonstrating resilience in a challenging global economic environment. For the three months ended June 30, 2009, net sales were $3.75 billion, a decrease of 5.5% compared to the prior year, primarily due to volume declines and unfavorable foreign exchange impacts, although net selling price increases partially offset this. Diluted earnings per share (EPS) rose to $1.07, an increase from $0.92 in the prior year's second quarter, reflecting improved profitability and effective cost management. The company saw strong performance in North America and Latin America, with solid organic sales growth in these regions. Despite global headwinds, including currency fluctuations and challenging macroeconomic conditions, Colgate-Palmolive maintained its focus on operational efficiency and strategic initiatives to drive growth and shareholder value.

Financial Highlights

45 data points
Beta

Revenue

$3.75B

58.8% Gross Margin

Net Income

$562.00M

15.0% Net Margin

EPS (Diluted)

$0.54

Total Assets

$10.73B

Cash & Equivalents

$896.00M

Free Cash Flow

$521.00M

Financial Statements
Beta
Revenue$3.75B
Cost of Revenue$1.54B
Gross Profit$2.20B
SG&A Expenses$1.30B
Operating Income$887.00M
Net Income$562.00M
EPS (Basic)$0.56
EPS (Diluted)$0.54
Shares Outstanding (Basic)1.00B
Shares Outstanding (Diluted)1.05B

Key Highlights

  • 1Net sales for the second quarter of 2009 were $3,745.0 million, a 5.5% decrease from the prior year, with volume declines and foreign exchange impact being key drivers.
  • 2Diluted Earnings Per Share (EPS) increased to $1.07 for the three months ended June 30, 2009, up from $0.92 in the same period of 2008.
  • 3Operating profit increased by 13% to $887.1 million in the second quarter of 2009, despite challenges, indicating improved operational efficiency.
  • 4Organic sales (excluding foreign exchange, acquisitions, and divestments) grew by 6.0% in the second quarter of 2009, highlighting underlying business strength.
  • 5The company successfully managed its selling, general, and administrative expenses, which decreased as a percentage of net sales due to lower advertising spend and cost-savings programs.
  • 6Despite a decline in Europe/South Pacific and Greater Asia/Africa net sales, North America and Latin America showed positive net sales growth or resilience, with strong organic growth in Latin America.
  • 7Cash provided by operations increased by 17% to $1,210.7 million in the first half of 2009, indicating robust cash generation.

Frequently Asked Questions

In the second quarter of 2009, Colgate-Palmolive's net sales were $3,745.0 million, a decrease of 5.5% compared to the prior year. This decline was attributed to volume decreases and a negative foreign exchange impact, which were partially offset by net selling price increases.

Colgate-Palmolive reported a diluted Earnings Per Share (EPS) of $1.07 for the second quarter of 2009, an increase from $0.92 in the same period of 2008. Operating profit also saw a significant increase of 13% to $887.1 million, driven by improved gross profit margins and lower advertising expenses.

The company demonstrated effective expense management. Selling, general, and administrative expenses decreased as a percentage of net sales. Additionally, the company benefited from higher gross profit margins, driven by pricing actions and cost-savings programs, and a reduction in advertising spend.

Colgate-Palmolive acknowledges the challenging global macroeconomic and market conditions, including currency fluctuations and economic downturns. However, the company believes it is well-prepared due to its strong financial condition, experience in challenging environments, and continued focus on strategic initiatives, including innovation, cost efficiency, and global brand strength.