Colgate Announces Record Sales for Third Quarter; Worldwide Unit Volume Up 9%; Loss Due to Previously Announced Restructuring Charge.Company (NYSE NYSE See: New York Stock Exchange symbol--CL) today announced record sales for the third quarter of 1995, its largest unit volume increase in more than a year, and a loss for the quarter brought about by the $369.2 million third quarter restructuring charge restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. ($2.54 per share) announced on September 20th. Driven by a 9% increase in unit volume, sales increased 11% to $2.1 billion, a record for any quarter ever. Colgate's businesses in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , Asia/Africa and Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. outside of Mexico all achieved excellent growth. After deducting the restructuring charge, Colgate reported a loss of $250.2 million or $1.76 per share for the third quarter, compared to net income of $151.0 million or $1.00 per share in the third quarter of 1994. Excluding the restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). provision, Colgate earned $119.0 million or $.78 in the 1995 third quarter. These results are in line with the Company's announcement on September 20. Reuben Mark, Colgate Chairman and Chief Executive Officer, said "I am pleased that Colgate's worldwide operations again achieved excellent sales and volume growth this quarter, a result of our strong global positioning. Colgate-North America continues to gain momentum and increased unit volume 13%, following its 10% increase in the second quarter. Our developing world business in Latin America and Asia/Africa also had double-digit unit volume growth, with the exception of Mexico, and Colgate-Europe achieved its best volume performance of the year to date. "As anticipated, sales and earnings in the most recent quarter were impacted by the severe recession in Mexico. Earnings also reflect the effect of the planned transition at Hill's Pet Nutrition Hill's Pet Nutrition, Inc is a subsidiary of Colgate-Palmolive Company. They are a large scale provider of dog and cat foods. History Hill's Pet Nutrition was a division of Hill Packing company, founded in 1907 by Burton Hill in Topeka, Kansas. from outside distributors to a direct Hill's sales force. "Importantly, Colgate's operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before everywhere else -- North America, Latin America outside of Mexico, Asia/Africa and Europe -- showed solid increases, indicating the continued strength of our business. Given our strong market share positions and the volume growth we are experiencing around the world, combined with the recently announced major restructuring underway to improve efficiency, we have strong confidence in Colgate's ability to achieve continued profitable growth in the future, as we have consistently done in the past." On September 20, Colgate announced a major restructuring of its manufacturing and administrative operations to enhance profitable growth and strengthen the Company's status as a low-cost producer of quality consumer products. Being implemented over the next two years, the Years, The the seven decades of Eleanor Pargiter’s life. [Br. Lit.: Benét, 1109] See : Time restructuring is expected to produce savings that start in the second half of 1996 and exceed an annual rate of $100 million per year by 1998. Approximately three-fourths of the restructuring will take place in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and Europe Following are comments about Colgate's business in the 1995 third quarter by geographic region and Hill's. Colgate-Asia/Africa (approximately 20% of Company sales) Colgate continues to grow strongly in Asia/Africa. Sales increased 17% and unit volume was up 12% in the third quarter, with large increases from India, China, Malaysia, the Philippines, Turkiye and Kenya. New products, distribution outreach Outreach is an effort by an organization or group to connect its ideas or practices to the efforts of other organizations, groups, specific audiences or the general public. programs in rural and hard-to-reach areas, and geographic expansion are all contributing to Colgate's momentum in these fast-growing regions. Colgate-Europe (approximately 25% of Company sales) Colgate-Europe achieved 3% unit volume growth, which, when combined with the strengthening of European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. currencies, resulted in an 11% sales increase. Countries exhibiting the best growth were France, which is Colgate's largest European market, the United Kingdom, Portugal, Greece, and Holland. Successful introductions of Colgate Platinum toothpaste toothpaste, n See dentifrice. , the revitalized re·vi·tal·ize tr.v. re·vi·tal·ized, re·vi·tal·iz·ing, re·vi·tal·iz·es To impart new life or vigor to: plans to revitalize inner-city neighborhoods; tried to revitalize a flagging economy. Palmolive personal care line, multi-surface bleach bleach Solid or liquid chemical compound used to whiten or remove the natural colour of fibres, yarns, paper, and textile fabrics. Sunlight was the chief bleaching agent up to the discovery of chlorine in 1774 by Karl Wilhelm Scheele (b. 1742—d. cleaners, Ajax bathroom gel and Fabuloso cleaner contributed to sales and unit volume gains in Europe. Colgate-Latin America (approximately 25% of Company sales) Sales increased 8% on 16% unit volume growth. Colgate-Latin America continues to build its Number One position in toothpaste, introducing new products under the Colgate brand name and increasing support for the Kolynos brand, which has gained Brazilian market share since Colgate acquired this business. Volume continued to grow in Colombia and Venezuela; recently expanded operations in Peru, Chile, Uruguay, Ecuador and Argentina also are doing well. Colgate's market shares in Mexico continue strong, but unit volume there declined significantly due to the severe recession. Excluding Mexico and the Kolynos acquisition, sales and unit volume each increased 15% for all the rest of Latin America. Colgate-North America (approximately 20% of Company sales) Successful new products and good market shares fueled the 13% increases in sales and unit volume for Colgate-North America. In the United States, Colgate has increased market share in 9 out of its 12 major product categories since the 1994 year-end. Canada and Puerto Rico Puerto Rico (pwār`tō rē`kō), island (2005 est. pop. 3,917,000), 3,508 sq mi (9,086 sq km), West Indies, c.1,000 mi (1,610 km) SE of Miami, Fla. are also achieving excellent growth. Palmolive Dishwashing Liquid & Antibacterial antibacterial /an·ti·bac·te·ri·al/ (-bak-ter´e-al) destroying or suppressing growth or reproduction of bacteria; also, an agent that does this. an·ti·bac·te·ri·al adj. Hand Soap is delivering incremental Additional or increased growth, bulk, quantity, number, or value; enlarged. Incremental cost is additional or increased cost of an item or service apart from its actual cost. share in the U.S., Canada and Puerto Rico. Colgate Baking Soda baking soda: see sodium bicarbonate. & Peroxide peroxide (pərŏk`sīd), chemical compound containing two oxygen atoms, each of which is bonded to the other and to a radical or some element other than oxygen; e.g. toothpaste, along with significant increases in advertising, is contributing to U.S. growth as well, while Canada is also growing behind Colgate Total plaque-fighting toothpaste, Javex bleach and Fleecy fleec·y adj. fleec·i·er, fleec·i·est Of, resembling, or covered with fleece: fleecy clouds. fleec liquid and sheet fabric softeners Fabric softener (also called Fabric Conditioner) is used to prevent static cling and make fabric softer. Popular brand names include Lenor, Lenor/Downy, Snuggle, and Comfort. . Hill's Pet Nutrition (approximately 10% of Company sales) Hill's continues to increase its worldwide pet food franchise but was affected by non-renewal of distributors in the third quarter. Hill's domestic market share of the specialty pet retail trade is up two full share points to 35% versus yearend 1994; however, the transfer of selling responsibility from outside distributors to Hill's own sales force, resulted in inventory liquidations at distributors. Reported sales were impacted by distributors' not reordering re·or·der v. re·or·dered, re·or·der·ing, re·or·ders v.tr. 1. To order (the same goods) again. 2. To straighten out or put in order again. 3. To rearrange. v. and were essentially flat versus the third quarter of 1994. Unit volume rose significantly from the first and second quarters of 1995 but was down 7% in a difficult comparison with the exceptionally strong third quarter of 1994. Colgate-Palmolive is a leading global consumer products company tightly focused on Oral Care, Personal Care, Household Care, Fabric Care and Pet Nutrition. With on-the-ground operations in over 90 countries around the world, Colgate sells its products in 202 countries and territories under such internationally recognized brand names as Colgate, Palmolive, Mennen, Ajax, Soupline, Suavitel and Fab, as well as Hill's Science Diet and Hill's Prescription Diet pet foods. -0-
Colgate-Palmolive Company Summary of Consolidated Results
Three Months and Nine Months Ended September 30, 1995 and 1994
(Dollars in Millions Except Per Share Amounts) (Unaudited)
Third Quarter Nine Months
1995 1994 1995 1994
Net Sales $2,134.4 $1,930.7 $6,205.4 5,591.8 Cost of Sales 1,109.7 978.9 3,230.8 2,875.2 Gross Profit 1,024.7 951.8 2,974.6 2,716.6 Provision for Restructuring 460.5 - 460.5 - Selling, General and Administrative Expenses 785.8 696.1 2,185.5 1,978.5 (Loss) Earnings Before Interest and Taxes (221.6) 255.7 328.6 738.1 Net Interest Expense 53.3 26.4 145.9 62.8 (Loss) Income Before Income Taxes (274.9) 229.3 182.7 675.3 (Benefit) Provision for Income Taxes (24.7) 78.3 133.2 232.2 Net (Loss) Income (250.2) 151.0 49.5 443.1 Preferred Dividends, Net of Tax 5.4 5.5 16.2 16.3 (Loss) Earnings Per Common Share (After Restructuring) $(1.76) $ 1.00 $ .23 $2.91 Average Common Shares Outstanding (000) 145,455 145,578 145,044 146,698 -0-
Colgate is restructuring its worldwide manufacturing and
administrative operations to enhance profitable growth, which is
reflected as an aftertax charge of $369.2 or $2.54 per share in the
1995 third quarter and $2.55 per share in the first nine months.
Excluding this charge, net income was $119.0 in the 1995 third
quarter, or $.78 per share vs. $1.00, and $418.7 in the first nine
months of 1995, or $2.78 per share versus $2.91.
Assuming full dilution, the (loss) earnings per common share was
$(1.76) vs. $.93 in the third quarter and $.23 vs. $2.72 in the
first nine months for the periods ended September 30, 1995 and 1994.
Average common shares used in the fully diluted computation were
145,455,000 vs. 159,567,000 in the third quarter and 147,293,000 vs.
160,726,000 in the first nine months.
-0-
Colgate-Palmolive Company
Supplemental Schedule of Consolidated Results
Excluding the Restructuring Charge
Three Months and Nine Months Ended September 30, 1995 and 1994
(Dollars in Millions Except Per Share Amounts) (Unaudited)
Third Quarter Nine Months
1995 1994 1995 1994
Net Sales $2,134.4 $1,930.7 $6,205.4 $5,591.8 Cost of Sales 1,109.7 978.9 3,230.8 2,875.2 Gross Profit 1,024.7 951.8 2,974.6 2,716.6 Selling, General and Administrative Expenses 785.8 696.1 2,185.5 1,978.5 Earnings Before Interest and Taxes (Before Restructuring) 238.9 255.7 789.1 738.1 Net Interest Expense 53.3 26.4 145.9 62.8 Income Before Income Taxes (Before Restructuring) 185.6 229.3 643.2 675.3 Provision for Income Taxes (Before Restructuring) 66.6 78.3 224.5 232.2 Net Income (Before Restructuring) 119.0 151.0 418.7 443.1 Preferred Dividends, Net of Tax 5.4 5.5 16.2 16.3 Average Common Shares Outstanding (000) 145,455 145,578 145,044 146,698 Earnings Per Common Share Before Restructuring $ .78 $ 1.00 $ 2.78 $ 2.91 Provision for Restructuring Per Common Share (2.54) - (2.55) - (Loss) Earnings Per Common Share After Restructuring $(1.76) $ 1.00 $.23 $ 2.91 NOTES: This schedule is provided as a supplement to the Colgate-Palmolive Company earnings release of October 19, 1995 and should be read in conjunction with the Summary of Consolidated Results as included in the earnings release. Assuming full dilution Dilution A reduction in earnings per share of common stock that occurs through the issuance of additional shares or the conversion of convertible securities. Notes: Adding to the number of shares outstanding reduces the value of holdings of existing shareholders. , earnings per common share before restructuring was $.74 vs. $.93 in the third quarter and $2.60 vs. $2.72 in the first nine months for the periods ended September 30, 1995 and 1994. Average common shares used in the fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. computation Computation is a general term for any type of information processing that can be represented mathematically. This includes phenomena ranging from simple calculations to human thinking. were 159,617,000 vs. 159,567,000 in the third quarter and 159,345,000 vs. 160,726,000 in the first nine months. CONTACT: Colgate-Palmolive Co., New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of Bina Thompson Thompson, city, Canada Thompson, city (1991 pop. 14,977), central Man., Canada, on the Burntwood River. A mining town, it developed after large nickel deposits were discovered in the area in 1956. , 212/310-3072 or Anne Crawford, 212/310-2730 |
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