- Colgate-Palmolive Co CL reported third-quarter FY22 sales growth of 1% year-on-year to $4.46 billion, missing the consensus of $4.49 billion.
- Organic sales increased by 7%. Total Oral, Personal, and Home Care net sales increased by 0.4% to $3.6 billion.
- Non-GAAP EPS of $0.74 was in line with the analyst consensus.
- Gross profit was $2.55 billion, while the margin contracted 220 basis points to 57.2%.
- Selling, general and administrative expenses remained flat at $1.6 billion.
- Operating margin contracted 60 basis points to 21.3%, and operating income for the quarter fell 2.1% to $947 million.
- The company held $938 million in cash and equivalents as of September 30, 2022. Net cash provided by operations was $1.9 billion for the nine months.
- "As expected, significant increases in raw and packaging material and logistics costs continued during the quarter and the negative impact from currency accelerated," said Chairman, President, and CEO Noel Wallace.
- Outlook: Colgate sees FY22 organic sales growth guidance at 6% - 7% versus prior 5% - 7%.
- The company now expects net sales growth to be in the middle of the 1% - 4% range, including an approximately 5% negative impact from foreign exchange and a modest benefit from the Red Collar acquisition.
- On a non-GAAP basis, the company still expects a decline in gross profit margin and now expects roughly flat advertising investment and a 7% - 8% EPS decline, reflecting the incremental negative impact from foreign exchange.
- Price Action: CL shares are trading lower by 1.00% at $72.50 in premarket on the last check Friday.
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