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Colgate Q4 Earnings Beat, Strong Volume and Pricing Drive Results
CLColgate-Palmolive(CL) ZACKS·2025-01-31 16:47

Core Insights - Colgate-Palmolive Company reported a decline in net sales for Q4 2024, missing the Zacks Consensus Estimate, while earnings per share (EPS) improved and exceeded expectations [1][2][3] Financial Performance - Net sales were 4,944million,down0.14,944 million, down 0.1% from 4,950 million in the previous year, and missed the consensus estimate of 4,987million[3]−Onanorganicbasis,salesgrewby4.34,987 million [3] - On an organic basis, sales grew by 4.3%, driven by a 2.5% increase in volume and a 1.8% improvement in pricing [4] - Gross profit increased to 2,982 million from 2,950millionyear−over−year,withagrossprofitmarginexpansionof70basispointsto60.32,950 million year-over-year, with a gross profit margin expansion of 70 basis points to 60.3% [6] - Operating profit was 1,064 million, a slight decrease from 1,072millionintheprioryear,withanoperatingprofitmargincontractionof20basispointsto21.51,072 million in the prior year, with an operating profit margin contraction of 20 basis points to 21.5% [7] Market Position - Colgate maintained a leading position in the toothpaste market with a 41.4% global market share and a 32.2% share in the manual toothbrush market [5] Regional Performance - North America saw a 1% decline in net sales, while Latin America experienced a 7.2% decline due to unfavorable currency impacts, despite organic sales growth of 9.2% [8] - Europe’s net sales increased by 4.9%, driven by volume and pricing gains [9] - The Asia Pacific segment improved by 3.7% year-over-year, with a notable 5.8% increase in volume [10] - Africa/Eurasia's net sales rose by 2.8%, supported by an 11.5% increase in volume [10] - Hill's Pet Nutrition's net sales improved by 2.3% on a reported basis [11] Cash Flow and Shareholder Returns - The company ended Q4 2024 with cash and cash equivalents of 1,096 million and total debt of 7,949million[12]−Netcashprovidedbyoperatingactivitieswas7,949 million [12] - Net cash provided by operating activities was 4,107 million for the year, with $3.4 billion returned to shareholders through dividends and share repurchases [12] 2025 Outlook - Colgate expects flat net sales in 2025, with organic sales growth projected between 3% to 5% [14] - The company anticipates gross profit margin expansion and mid-single-digit growth in Base Business EPS for 2025 [15][16]