Colgate-Palmolive Sales Fall, Hurt by FX, But Profit Climbs
30 October 2015 - 11:14PM
Dow Jones News
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.
Analysts surveyed by Thomson Reuters forecast per-share earnings
of 72 cents a share on revenue of $4.07 billion.
Shares were inactive premarket.
Write to Ezequiel Minaya at Ezequiel.Minaya@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
October 30, 2015 07:59 ET (11:59 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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