Colgate-Palmolive Revenue Declines
July 28 2016 - 9:20AM
Dow Jones News
Colgate-Palmolive Co.'s revenue slid more than expected in the
most recent quarter, as foreign currency headwinds dragged down
results, particularly in Latin America.
The company, which makes its namesake toothpaste and dish soap,
does most of business abroad and has struggled with the stronger
U.S. dollar, making products more expensive to overseas
consumers.
Chief Executive Ian Cook pointed to strong organic sales growth
"in the face of continued challenging macroeconomic conditions
worldwide."
However, he said macroeconomic conditions and foreign-exchange
volatility remain challenging looking ahead, and the company
expects a low- to mid-single-digit sales decline for the year. The
company continues to expect adjusted per-share earnings to be flat
with 2015.
In all for the June quarter, Colgate earned $600 million, or 67
cents a share, up from $574 million, or 63 cents a share, a year
earlier. Excluding certain items, earnings were flat at 70 cents a
share, just above analysts' expectations for 69 cents a share,
according to Thomson Reuters.
Revenue fell 5.4% to $3.85 billion in the quarter, just below
analysts' estimates for $3.86 billion. Stripping out currency
fluctuations, acquisitions, divestments and the impact of the
deconsolidation of Colgate's Venezuelan operations, the top line
grew 4.5% organically.
Sales in Latin America—which make up nearly a quarter of the
company's revenue—fell 17%, sales in Asia Pacific were down 7%, and
sales in Africa/Eurasia slipped 6%. Sales rose 2% in North America
and edged up 0.5% in Europe.
Gross margin widened to 59.9% from 58.2%.
Shares, inactive premarket, have risen 10% this year.
Write to Anne Steele at Anne.Steele@wsj.com
(END) Dow Jones Newswires
July 28, 2016 09:05 ET (13:05 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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