Strong Dollar Hits Colgate-Palmolive Sales
November 02 2015 - 3:02AM
Dow Jones News
(FROM THE WALL STREET JOURNAL 11/2/15)
By Ezequiel Minaya
Colgate-Palmolive Co. said its sales slipped 8.7% in the third
quarter, hurt once again by significant currency-related headwinds,
though profit climbed during the period, helped by cost cuts,
increased prices and a more favorable tax rate.
Many consumer-product companies that do a large chunk of
business abroad have blamed the stronger U.S. dollar for lackluster
results, as it makes their products more expensive abroad and
diminishes revenue once repatriated. For Colgate, roughly 80% of
revenue is generated abroad.
Foreign-exchange volatility had a 13% drag on sales, the company
said.
Colgate has raised prices in recent quarters in an attempt to
offset the hit from foreign exchange. Over the latest quarter,
Colgate -- the maker of its namesake oral-care products, Lady Speed
Stick deodorant and Science Diet pet food -- said it raised prices
3.5%.
The company also has been working to cut costs. Colgate brought
down selling, general and administrative expenses to 33.7% of sales
from 34.2% during the same period a year ago. The effective tax
rate during the latest quarter fell to 31.9% from 38.6% the earlier
year.
Overall, the company posted a profit of $726 million, or 80
cents a share, up from $542 million, or 59 cents a share a year
earlier.
Revenue dropped 8.7% to $4 billion.
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(END) Dow Jones Newswires
November 02, 2015 02:47 ET (07:47 GMT)
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