Colgate’s Sales Slip in Q3

Colgate-Palmolive Company said third quarter sales fell 3% to $3.8 billion. Global unit volume was even with the year ago quarter, pricing increased 1.0% and foreign exchange was negative 4.0%. Professional skin care acquisitions contributed 1.5% to net sales and unit volume growth in the quarter. Organic sales decreased 0.5%. Net income declined near 14% to $523 million.
 

“The third quarter was a challenging one with category growth rates remaining soft in many markets and unfavorable movements in foreign exchange. Net sales decreased 3.0% and organic sales decreased 0.5%, primarily due to market volatility in Brazil and trade inventory reductions in China,” said Ian Cook, chairman and chief executive officer. “While the pricing environment remains difficult given competitive and retailer dynamics, we are pleased we delivered positive pricing this quarter, which partially offset higher commodity and logistics costs.”

Colgate’s leadership of the global toothpaste market continued during the quarter with C-P's global market share at 41.9% year to date. Global leadership in manual toothbrushes also continued with Colgate’s global market share in that category at 32.2% year-to-date.
 

“As we look ahead, while uncertainty in global markets and category growth worldwide remain challenging, we are maintaining our heightened focus on brand building and increased productivity while accelerating our change efforts,” explained Cook. “Based on current spot rates, for the fourth quarter we expect a low-single-digit net sales decrease due to foreign exchange and low-single-digit organic sales growth.”

North America net sales increased 8.0% in third quarter 2018. Unit volume increased 7.5%, pricing increased 0.5% and foreign exchange was even with the year ago quarter. The previously disclosed professional skin care acquisitions contributed 6.0% to Net sales and unit volume growth. Organic sales and organic unit volume for North America increased 2.0% and 1.5%, respectively. In the US, Colgate maintained leadership in the toothpaste category during the quarter with its market share at 34.7% year to date. Successful products include Colgate Optic White Stain Fighter, Colgate Optic White Stain-Less White and Tom’s of Maine toothpastes. In manual toothbrushes, Colgate widened its brand market leadership in the US, with its market share in that category at 41.5% year to date, supported by the success of Colgate Total 360° Advanced Optic White and Colgate Gum Health manual toothbrushes. Products succeeding in other categories include Softsoap Hydra Bliss body wash and liquid hand soap, Irish Spring Non-Stop Fresh body wash, Fabuloso Complete liquid cleaner and Suavitel Complete fabric conditioner.

Latin America net sales decreased 13.0% in third quarter 2018. Unit volume decreased 6.0%, pricing increased 2.5% and foreign exchange was negative 9.5%. Volume declines in Brazil, Central America and Argentina were partially offset by volume gains in the Greater Caribbean region and Mexico. Organic sales for Latin America decreased 3.5%. Colgate maintained its toothpaste leadership in Latin America during the quarter, with market share gains in Brazil, Panama, Guatemala, Chile, El Salvador and Honduras. Products succeeding in the region include Colgate Total 12 Salud Visible and Colgate Triple Action Xtra Freshness toothpastes. Colgate’s leadership in the manual toothbrush category continued throughout the region, supported by the success of Colgate 360° Advanced Total 12 and Colgate Pro Cuidado manual toothbrushes. Products succeeding in other categories include Colgate Total 12 mouthwash, Protex Deep Clean, Palmolive Neutro Balance and Palmolive Natureza Secreta bar soaps, Axion dish liquid and Fabuloso Complete liquid cleaner.

Europe net sales decreased 0.5% in third quarter 2018. Unit volume increased 2.0%, pricing decreased 1.5% and foreign exchange was negative 1.0%. Volume gains were led by the United Kingdom, Spain and Greece. Organic sales for Europe increased 0.5%. Colgate maintained its toothpaste leadership in Europe during the quarter, with market share gains in France, Italy, Greece, the Netherlands, Denmark and Austria. Products succeeding in oral care include Colgate Max White Expert Complete, Colgate Natural Extracts and Colgate Sensitive Pro-Relief Advanced toothpastes, Colgate 360° Advanced Whole Mouth Health and Colgate Slim Soft Advanced manual toothbrushes and Colgate Plax mouthwash. Products succeeding in other categories include Sanex Zero% and Sanex Dermo Physiologique shower gels, Ajax Boost liquid cleaner and dish liquid and Soupline Moments of Nature fabric conditioner.

Asia Pacific net sales decreased 7.5% during third quarter 2018. Unit volume decreased 4.0%, pricing was even with the year ago quarter and foreign exchange was negative 3.5%. Volume declines in the Greater China region were partially offset by volume gains in India. Organic sales forAsia Pacific decreased 4.0%. Colgate maintained its toothpaste leadership in the Asia Pacific region during the quarter with market share gains in Australia and the Philippines. Products succeeding in the region include Colgate Naturals, Colgate Swarna Vedshakti, Colgate Power White, Colgate Sensitive Pro-Relief and elmex Sensitive toothpastes. Products succeeding in other categories include Colgate Slim Soft Advanced and Colgate Slim Soft Flex Clean manual toothbrushes, Palmolive Skin Therapy bar soap, Colgate Plax mouthwash, Palmolive Luminous Oils shower gel and Cuddly Aroma Intense fabric conditioner.
 

Africa/Eurasia net sales decreased 6.0% during third quarter 2018. Unit volume decreased 0.5%, pricing increased 3.0% and foreign exchange was negative 8.5%. Volume declines in Russia and Saudi Arabia were partially offset by volume gains in the Gulf States and Israel. Organic sales for Africa/Eurasia increased 2.5%. Colgate maintained its toothpaste leadership in Africa/Eurasia during the quarter, with market share gains in Turkey, Saudi Arabia, United Arab Emirates, Kenya, Kazakhstan and Kuwait. Successful products contributing to sales in the region include Colgate Ancient Secrets, Colgate Natural Extracts, Colgate Optic White Expert White and Colgate Maximum Cavity Protection toothpastes, Colgate 360° Advanced Whole Mouth Clean and Colgate Slim Soft Advanced manual toothbrushes and Palmolive Gourmet and Palmolive Luminous Oils shower gels.