8-KFinancial Events

COLGATE PALMOLIVE CO 8-K Report, Exit or Disposal Costs (May 17, 2006)

Filed May 17, 2006For Securities:CL

Summary

Colgate-Palmolive Company (CL) filed an 8-K report on May 17, 2006, detailing costs associated with exit or disposal activities. As part of its ongoing four-year restructuring and business-building program, the company announced a voluntary early retirement program for certain U.S. employees. This initiative aims to further align organizational resources with strategic business objectives. The financial impact of this voluntary program is currently not precisely known, as it depends on employee participation. However, the company estimates that the associated charges will be roughly 10% of the overall Restructuring Program's previously disclosed after-tax charge range of $550 million to $650 million. These charges are expected to be substantially cash-based. The anticipated savings from this early retirement program are already incorporated into the broader Restructuring Program's projected annual after-tax savings of $250 million to $300 million by the fourth year.

Key Highlights

  • 1Colgate-Palmolive announced a voluntary early retirement program for certain U.S. employees on May 16, 2006.
  • 2The program is part of a larger, previously disclosed four-year restructuring and business-building initiative.
  • 3The primary goal is to re-align organizational resources with business-building objectives.
  • 4The exact charges are unknown due to the voluntary nature of the program, but are estimated to be about 10% of the total restructuring program charges.
  • 5The charges are expected to be largely in cash.
  • 6The total estimated charges for the entire restructuring program are between $550 million and $650 million after tax.
  • 7Anticipated annual savings from the overall program are between $250 million and $300 million after tax by the fourth year.

Frequently Asked Questions

The voluntary early retirement program is designed to help Colgate-Palmolive re-align its organizational resources to better support its ongoing business-building goals as part of its broader restructuring efforts.

While the exact charges are not yet known due to the voluntary nature of the program, Colgate-Palmolive estimates they will represent approximately 10% of the total after-tax charges for its overall Restructuring Program, which was previously estimated to be between $550 million and $650 million.

Yes, the company expects the charges associated with this voluntary early retirement program to be substantially all in cash.

The expected savings generated by this early retirement program are already included within the previously disclosed estimated annual savings range of $250 million to $300 million after tax, which the company anticipates achieving by the fourth year of its overall Restructuring Program.