Summary
Colgate-Palmolive Company (CL) announced on December 6, 2004, a significant four-year restructuring and business building plan aimed at enhancing its global leadership in core businesses. The initial phase, effective from Q4 2004, involves 17 projects including facility closures/reconfigurations and sales force consolidation across various regions. This initial phase is expected to incur approximately $102 million in after-tax charges, with about half leading to future cash expenditures. The broader plan anticipates total after-tax charges between $550 million and $650 million, with projected annual savings of $250-$300 million after tax by the fourth year. Investors should note that charges for the full year 2005 are estimated at $200 million, with anticipated savings of $45 million for the same year.
Key Highlights
- 1Colgate-Palmolive approved a four-year restructuring and business building plan starting in Q4 2004.
- 2The initial phase includes 17 projects such as facility closures and sales force consolidation in Europe, North America, Latin America, and Asia.
- 3The initial phase is projected to incur approximately $102 million in after-tax charges, with $45 million in Q4 2004.
- 4Approximately 50% of the initial phase charges are expected to result in future cash expenditures.
- 5The total cumulative charges for the entire four-year plan are estimated between $550 million and $650 million after tax.
- 6The plan aims to generate annual after-tax savings of $250-$300 million by the fourth year.
- 7Full-year 2005 charges are estimated at $200 million, with expected savings of $45 million.