COLGATE PALMOLIVE CO Quarterly Report for Q3 Ended Sep 30, 2011

Summary

Colgate-Palmolive Company reported a solid third quarter and nine-month period ending September 30, 2011, demonstrating robust sales growth driven by both volume and strategic acquisitions. Net sales for the quarter increased by 11.0% to $4,383 million, with a significant portion attributed to the acquisition of the Sanex personal care business and favorable foreign exchange rates. For the nine-month period, net sales grew 8.5% to $12,562 million. Profitability was impacted by several factors, including higher raw material costs which pressured gross margins, offset by cost-saving initiatives and pricing actions. Despite these pressures, operating profit increased for both the quarter and the nine-month period, reflecting effective cost management and the positive impact of strategic divestitures, such as the sale of laundry detergent brands in Colombia. Diluted earnings per share also saw an increase, highlighting the company's ability to translate sales growth into shareholder value, even amidst challenging global economic conditions and competitive pressures.

Key Highlights

• 1Net sales increased 11.0% to $4,383 million in Q3 2011, driven by volume (4.5%), pricing (2.0%), and favorable foreign exchange (4.5%).
• 2The acquisition of the Sanex personal care business contributed 2.0% to worldwide net sales and volume growth in Q3 2011.
• 3Gross profit margin decreased to 56.2% in Q3 2011 from 59.4% in Q3 2010, primarily due to higher raw and packaging material costs.
• 4Operating profit increased 8% to $1,035 million in Q3 2011 compared to $958 million in Q3 2010.
• 5Diluted earnings per share increased to $1.31 in Q3 2011 from $1.21 in Q3 2010.
• 6The company divested its laundry detergent brands in Colombia for $215 million, recognizing a pre-tax gain of $207 million.
• 7Cash and cash equivalents increased significantly from $490 million at the end of 2010 to $945 million at the end of Q3 2011.

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