Colgate-Palmolive Company (CL) Q3 2024 earnings summary

Executive summary

• Net sales rose 2.4% year-over-year to $5,033 million in Q3 2024, with organic sales up 6.8% and balanced volume and pricing growth, despite a 4.4% negative FX impact.

• All operating divisions delivered positive volume growth for the second consecutive quarter, with notable strength in Europe, emerging markets, and Hill's pet segment.

• Gross profit margin expanded 260–270 basis points year-over-year to 61.1% (GAAP), supporting increased investment in innovation and advertising.

• Net income attributable to Colgate-Palmolive increased to $737 million, with diluted EPS up to $0.90; Base Business EPS up 6% to $0.91.

• Maintained global market leadership in toothpaste (41.6% share) and manual toothbrushes (32.3%).

Financial highlights

• Nine-month net sales grew 4.5% to $15,156 million, with organic sales up 8.5%.

• Net income for the nine months was $2,150 million, up from $1,582 million; diluted EPS was $2.61, up from $1.90.

• Gross profit margin for the nine months increased to 60.6% from 57.7%.

• Advertising spend increased 16% year-over-year in Q3, supporting innovation and brand health.

• Return on capital annualized at 34.7%, up over 600 basis points from year-end 2023.

Outlook and guidance

• Full-year 2024 net sales growth expected at 3%–5%, including a mid-single-digit FX headwind; organic sales growth guidance raised to 7%–8%.

• Base Business EPS growth now expected at 10%–11% (was 8%–11%); GAAP EPS still expected to be up double digits.

• Gross profit margin and advertising investment anticipated to be up for the year.

• Management expects continued macroeconomic and market challenges, including inflation, high interest rates, and FX volatility.

• No quarterly guidance provided, but underlying business health remains strong.