Colgate-Palmolive (CL) 29 Jul 222022 Q2 Earnings call transcript

Company Profile

Participants

John Faucher	Chief Investor Relations Officer and Senior Vice President, M&Q
Noel Wallace	Chairman, President and CEO
Stan Sutula	Chief Financial Officer
Peter Grom	UBS
Dara Mohsenian	Morgan Stanley
Chris Carey	Wells Fargo Securities
Andrea Teixeira	JP Morgan
Kaumil Gajrawala	Credit Suisse
Kevin Grundy	Jefferies
Bryan Spillane	Bank of America
Rob Ottenstein	Evercore
Steve Powers	Deutsche Bank
Olivia Tong	Raymond James
Mark Astrachan	Stifel
Lauren Lieberman	Barclays
Jason English	Goldman Sachs

Call transcript

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Operator

Good day. And welcome to today’s Colgate-Palmolive Company’s Second Quarter 2022 Earnings Conference Call. This call is being recorded and it’s being simulcast live at www.colgatepalmolive.com.

Now for opening remarks, I would like to turn the call over to the Chief Investor Relations Officer and Senior Vice President, M&Q, John Faucher. Please go ahead, John. you. Thank

John Faucher

to Actual earnings morning. call. SEC, our website, Today’s This cause of for call on materially statements. will earnings GAAP that forward-looking Please the subsequent in earnings materials Good the filings is earnings our including included second conference a welcome discussion materially discussion SEC of XX-K include Tables Colgate’s and in release XXXX Colgate’s conference annual financial filings, non-GAAP release and the refer conference differ press measures release press from and corresponding is available actual most factors press statements. could identified And X Caroline. and will statements. X This reconciliation our the XXXX to to a financial the of those quarter is earnings recent call from Form website. available all Thanks, differ results the these could including results include and on John full measures release. also to these with report Faucher. A on

Stan me will Chief results call on are and morning Wallace, Financial President XXXX outlook. on our Joining and and with Officer; Executive Officer. this Chairman, Noel his you now Chief QX provide Noel thoughts the Sutula, our

We will then open it up for Q&A. Noel?

Noel Wallace

quarter this thanks Thanks, second you am I morning. us to all delighted John, with joining to our results. and for share you of

quarter would results. first call, about confidence growth quarter accelerate the On first sales talked our our my that I from organic

gives drive we guidance which that call. to growth made April improvement for Colgate this the in XXXX. was X% March trends to sales our But me we are growth, and to fundamental is on of organic have to changes discussed why the the people X% confidence is raising in Some due what really February,

portfolio years double-digit strategies growth ago Care put in organic quarter in the three growth and place the Our on and power working. our we show objectives Nutrition, sales our that including how Oral is are global second delivering results Pet of

We our are of across divisions our all of growth all delivering and categories.

are have built We because the healthier pricing brands. take to showing we ability

We can transformational category market innovation both our we growth breakthrough that share. innovation up have can capabilities and drive more and deliver built so

growth of moving target second of all marked or We our in either categories Oral sales sales our Nutrition, to gross seeing, four XXth markets X% at rebuild organic organic to and across six broad tools which Hill’s our is that company our this is raw our delivered four efforts divisions. with capabilities underdeveloped. to in management our our Care inflation categories, material -- markets price significant We have and we growth our in the with along of accelerated other all the operating at environment, Care, all in Personal to delivered and above line leveraging Home growth important Pet X%. we logistics productivity X% long-term developed our growth Care, long-term where in the revenue range above ecommerce improve are margin in transformation in crucially X% either organic and based. our And our digital to positive to by and lead built forward. consecutive mixes range China, has enabled growth of ability quarter and mix, looking this have offset pricing and our target the the are driving or although, And the We sales quarter, with with channel us the growth quarter

quarter premiumization also a marketing growth. revenue allowed in points on strong on and this performance Encouragingly, plans, a innovation in our and one behind growth us to both management As chain basis, quarter improved deliver first a pricing supply pricing, our despite the sequential call, performance. two-year volume on we discussed basis the XXX year and execution improved acceleration sequentially

improve market year-to-date to performance Our share toothbrushes are global up basis. now with continues our toothpaste manual on a and

to funding with our of to another deliver is quarter lost vital margin. to productivity which on continue growth, regain gross strong plans We to

As we half, enter early see are back XXXX my just beginning the to global benefits productivity initiative. we from

with Over billion we cost costs difficult expect higher XX leverage. dealing well. in as months, packaging help drive But raw now still a the next material this We $X.X very operating will program environment. and are with inflation, logistics

become Exchange earnings have continue in dollar on quarter But most release. currencies has advertising basis, the working to $X weakened on will and spending The digital was with with continued has other as headwind well. from invest shift focus first a brands, our spending. higher Foreign and we up parity to our since non-working euro bigger moved to

investing We capital to as growth well. are our drive future

roll Hill’s, We for particularly are meet out globe. building the we capacity also which recyclable tube, consumer to but to projects demand, like strong across continue other our for

questions. XXXX to management gross capital balance focused to strategies As Caroline? in Q&A. sustainable profitable can right deliver we working and into our of deliver next our all rebuild our on four and that, we And and am of the move to take categories. growth happy while growth margins are we revenue I Caroline, to with the executing the support your our look targets, year, on brand with plans innovation, to growth long-term

John Faucher

call. hold problem we can a If their are the on on, on Okay. working. seems It just there’s end everyone like

Noel Wallace

Yeah. Are we in?

John Faucher

You are Yeah. muted.

on can call hold on are you. hopefully, working up Everyone will so, conference the just and We problem a tight. we back There’s Thank be it. shortly.

Operator

with will question come UBS. Grom from Peter with will we take from actually Apologies, Morgan Stanley. [Operator question that Instructions] first Mohsenian Dara And our

Peter Grom

morning, everyone. Good Hey.

Noel Wallace

Hey, Peter.

Peter Grom

are you well. hope doing I Yeah.

in growth from emerging as Thanks. and update here if down demand the you your Latin America? can out just look trade and the in year could back we any take signs of a half consumer markets core just us wondering And do potentially you to think of how back see or guess, categories? the beginning your I step Noel, we evolves market markets, to and of the So, health I some particularly into kind was key maybe softening an of maybe give emerging Are on you XXXX? specifically of

Noel Wallace

Yeah. Sure. Thanks for the question.

scan we numbers and some the least vitality great pretty out the continuing laid but that the coupled quarter level, in if the the we the revenue you now. see in are in innovation saw slowdown Strong mid-single on side allowed innovation volume. you accelerating to value as we management, good into particularly us world, but really you of our markets. around both emerging growth question looking premium has where come be at through, of you as and lot at pretty out to obviously consumer pricing in obviously world, back to would continue can A continue Europe If your imagine to categories. growing our price cycle growth, digits, orientation But it topline the developed first sluggishness specifically those some good emerging, importantly, the strong and looks take going strategy pricing to in we to strong on more overarching deliver with markets

we line economic and overall, we but market lot the and are. categories behave seen slightly far expected. pricing down, we factors change are impact Not what We ground, looking the lot closely, a watch the teams But consumer exactly elasticities trade Peter. the see a going expected you in more will at But over where more or better. with obviously of early on But, have far, that days. We really so categories. so time other the have as as of its elasticities into will

how will We that see evolves time. over

Operator

Dara from Mohsenian And will with our next Morgan come question Stanley.

Dara Mohsenian

guys. Hey,

Noel Wallace

Dara. Hi,

Dara Mohsenian

So, terms a we pricing to so you Latin growth Are in then the the move you that if bit Thanks. similar about have are levels? the given able specifically, you in mentioned far. realize be touch And you the seen talk consumer just in maybe the elasticity on of a would of helpful pretty quarter? about the this And America, strong looks bit little also? turnaround just U.S.? seeing sustainability good little in could just Americas the environment, competitive you the competitors Can at talk

Noel Wallace

Sure.

In terms react their strategies them. competitors to frankly have pretend been to don’t statement of, we it’s I just seen competition, and an on or quite to understand how overarching constructive relative clearly, behave

markets, We be taking large around would ultimately, case are strategies marketplace everyone, some been of the in as impacting pricing again out inflation we in quarter leading would the as executing and the laid very and that’s we that well early our we given on world. follow on is a expected and the by the competition call see and focused we in the first

constructive overall, to So, environment a pricing. relative

in first highlighted taking the America that as and have the In strong pricing through we quarter seen saw you quarter, momentum April, and in see build Americas, Again, the terms that turnaround business. and of call the performance the were mentioned the we we continued see a in our now out the first excited takeaway North obviously, you at premium Pro business, of hold, certainly with call North the I innovation taking overall. they on categories. which of across strong that, to saw the The consumption Series, obviously, would is end good toothpaste. America is obviously, performance

broad-based the scanner think, of U.S. of importantly, and last business, -- XX performance some and which data across over the shows in in XX, categories which turnaround of again, scanner eight with of innovation share the XX all market I in we coming performance, up the seen weeks, in have You our the that eight categories compete. the

So, overall, good.

we more consumers an moving But will news watching consumer where very is, planned relative have to carefully. the we unpredictable that see and inflation pricing have back watch closely. we across of evolving, half are We we impact this pricing, the the taken we the world environment evolving. into good see It’s where

Dara Mohsenian

Okay.

Operator

our with next Securities Carey And Wells Chris has Fargo question.

Chris Carey

morning. Good Hi.

progress in on So to the pretty starting has on expectations? the be if remarks which and are you prior pricing the the even in to prepared with your wonder margins American updated supply just margins traction bit we with potential thoughts just than chain this have your stand sequentially today I to is good as rebuild amidst pricing, noted you pretty on abate good segment higher consumer little where headwinds built, going that, North any inflation, a that on

Noel Wallace

Yeah. Thanks, Chris.

revenue on known towards into have to pricing XXXX. You through and strategies on value the to have getting other innovative moving focused is innovation find The will to clearly the we discipline focused this laser continue gross through brands, profit and move initiatives we marketplace. into growth, take and pricing balance company we as forward. our the across health get that we continue many our we the and feel been how be and management investment organization categories are recovering our profit gross we will and ways the drive our be equipped have year quite innovation for growth roadmap focused of teams that clearly category tailored pricing ability the of we to and that that behind have brands, confident to the will in given the And years, putting

We as will the flex had our markets recognizing portfolio high end portfolio we closely historically, a of quite and to been economic watch the the products. where I mentioned. We broad compete we of and in market, able difficult at end we circumstances. at it have very But low very have have well

forward sure continue seen we So moving to capturing expect the ultimately, But, see the have price points be top you that not will across some we end stage. innovate any we happens, to opportunity that will would if which this trade and will down that premiumization all we continue I to see. are drive trade innovate down we at and

Operator

And Morgan. from come Andrea with JP our will question next Teixeira

Andrea Teixeira

and for format call thank morning Good remarks. and prepared new you the

on globally global in So my on volumes On follow-up the impressive an X.X and pricing, about in and Asia-Pac. in North you question is quarter and X% Europe had a pricing America. uptick

there. mentioned care, lost temporary believe magnitude? had and sure lost because related I coming in of in you make can the takes -- if or X% just oral believe and in the want the the decline you exit U.S. volumes, you we Asia-Pac I confirm is there to war. pricing I in it’s not I up make to additional just mean, you Europe, timing perhaps I sure if you you And the a round that as volume July. Can but you. we not potentially So to distribution, terms through because know had the and organic basis. obviously sure X% And minus you Thank exit mean also, take all to growth, and the rate Noel puts -- that the recover you Wallace, a there? XX, in

Noel Wallace

one. A lot in Yeah. Thanks. packed that

across moved in growth and little I of saw where points. volume obviously topline. you growth is and the about America, if a volume around X.X. Asia XXX that thoughts call me Hill’s, nearly overarching the bit up let we talk the So take Obviously, organic out North impact strong But Russia, positive basis the pricing

you things, impacted by a to become the certainly tend So, adjusted is across calling overall, as happen pricing impacted everyone the see -- market growth that that We we the to take out the all markets Europe pleased we the across couple and are broadness I to on divisions that the look new see of early very obviously saw that ultimately, but some When other that we pricing. the markets, specifically just with mentioned. of the some at, volume of negotiations was pricing, elasticity positive mitigated in tends categories. of you took some time pricing on as over Europe

obviously growth I China both easier Hawley & in in about, Asia, grew business, on comp. volume. a more pricing which well We asked CP call an out quarter difficult you Hazel, but as in on strong had significantly in comp Asia, the and would the

saw there. So China, pleased lockdowns overall really the in despite marketplace that the we with

we strong our of and that most So consumption across overcome business. growth to were deliver able

volume. So, the are overall, balance and pleased we with pricing of

pleased to into more we are forward. the sustain price we We getting and pleased going are with that that’s multiple points pricing the with across order how in market innovation executed, are moving importantly,

the pricing we year my Moving see but on say market. to that’s as more pressure will get in expected continue the we that, expectation would go, forward, volume in I is be pushing to be pricing some we to and will

of that. part points The innovation balance to price the is important all across mitigate

Operator

Credit next And our with Suisse. Gajrawala from question will come Kaumil

Kaumil Gajrawala

morning. Good guys. Hey

Noel Wallace

morning. Good

Kaumil Gajrawala

is like than compare Can revenue you how contrast versus talk market better the perspective. what your on curious it have spot your planned, elasticities there look are stays market. you assuming And such? Obviously, Thanks. and but assumptions volume where or and costs, or versus looks shares they a are perspective then on palm like in like some assumptions particularly commodity maybe from things, it for just to linked do for oil

Noel Wallace

Yes.

As the performance. we with the prepared very share I remarks, -- pleased are in mentioned very

-- to toothbrushes. and of are our both the that public lot make the performance shares ecommerce well a that channels. being on recognize said, Now pricing. global some public we shares that and don’t share of that we taking continue track untracked we pickup toothpaste But Obviously,

time, where to we enter Volume pricing that. have bit acute seeing have shares you see to responsibility are to the responsibility if a seen you So in over drive shares little innovation our But respond with to volume the But been value time, softer. work you the points, it’s look come categories. across back marketplace, trade very price our back bring historically, down. mentioned, over as I volume

traffic We big have builders.

bring basket. and us Our volume retailers stores to we brands on into around are strong and world their drive and the know rely traffic our

of get to little On ensure a pricing finding focus on we coming So manage more be specifically, go, but But $X.X talked protected. we raw that we volumes the billion the we expect, year will the innovation to I the is that first will commodity market, closely. of bit quarter, again, do continue material as to very, category will in back volume inflation. to soft very about aspect

most is come get of back will the coming that of half up the quarter. quarter, lot back in but second we through year. to that adjusted $X.X this the of There have that billion We will a

are that execute see in get seen, obviously, in of that the much that pricing environment have more deflation that down, quarter. XXXX. pretty the in raw come look possibly take and will have seeing that will obviously bit little quarter, But we but spot coming we effectively. you make benefit third new we mentioned as for logistics, of both some and plans to a to the unprecedented materials marketing we locked to, we any Any fourth and we We rates on given to have sure the continue that commodities are

Operator

And Grundy our from Jefferies. with Kevin next question will come

Kevin Grundy

always. on as congrats morning, Good quarter Thanks. everyone, Great. and

Noel Wallace

Kevin. Hi,

Kevin Grundy

Noel, bit X%. to what am with the and from some macro it’s your it does the hold of of Hey. little midpoint of morning, year, and touched just some pull category, just some elasticities that in to again seen looking maybe maybe the relative forth just you category-specific commentary to you by X% have deceleration its touch X% respect upside, elasticities guidance together comparisons. little underlying just And, so so up that just kind each at on I imply understanding that, differ of to And half as of and in half? it Good guidance, a so have conservatism the far but it comment the get assumptions pulling on the Good going Thank call morning. should of of and back the bit back but around the pertains maybe to hedged the you. you pieces some to to together the on of and on year-over-year everyone.

Noel Wallace

Yeah.

were issue continues see we the through have and P&L. based first we on have the able to we be our fact categories strong good in But, based on, incremental guidance we obviously, overall, the based biggest get been FX on consumption early up obviously, the to expected. are the the as the where that volume seeing that moving taken quarter. some behaving we see see market So, pricing we on in we

we right what’s watching happening very, performance those given the in incredible unpredictability very Now category carefully. world of are global the now,

adjust or be but slightly it’s down to are going we on stage. as happen will better it consistent this at difficult elasticity and be fact what’s exactly the very estimations the to move road, based will predict we we to expected accordingly Our the what with

based our see So we and on macros we can what control. we can today what

So against that we the growth and over of the the core, last the that faster have let’s executing We you things that can had results of to new we looking and back XX come ecommerce, all channels control. driving some execution we particularly quarters. about, the and strategy what control have the delivering we channels are at our adjacencies, talked see in

pleased taking hold. strategies are we So with the

terms evaluate entire competencies out to think we around of building across I are the on seeing how the play all building we in performance. the well that are that are starting are innovation we the competencies in digital we enterprise, them and track

Operator

question from Bank Spillane come will next with Our America. Bryan of

Bryan Spillane

morning, Good everyone.

Noel Wallace

Hey, Bryan.

Bryan Spillane

I broadly wanted question of years ask just so like a forgetting more and timeframes. of constructs to -- about margins rebuilding gross just about fiscal the about and the

or rebuild at Just margins you level goods cost possible its of be the stay the or today gross proceed? gross does disinflation, it so Would doesn’t inflation cost is it were to were somewhat this -- can will, inflation cost level to sort some upon if if of margins to you it your basket? depend basket at with in rebuild current

Noel Wallace

Yeah. of things, on It Bryan. couple a depends

need A brand, that that with the the focus in that across competitors pricing promotion have really we very putting confident innovation that and portfolio needs the of we that to flex First forward. you that out we happen, think and come longer of need investment go a moves the obviously, we are moving levels the can to will in We us. behind it’s brands our the constructive carefully. We been It’s grid we strength margins feel are prepared that. on of around real for price the given as this of But see market to things unprecedented pricing. the stage. think couple manage front the quite believe will different points to over down, particularly and very, our gross and is foremost, current in we we that where see our you the of rebuilding hold, given question quite rational term inflation pricing do environment, that, it’s

be hold, inflation case. the will marketplace my that if pricing sense see will in will my and determinant view, today, we where given the So holds, big is, be, the

that the we can is rebuild answer margins. term, absolutely longer yes, gross So believe we

Bryan Spillane

you. Thank

Operator

comes Rob question with from Ottenstein next Our Evercore.

Rob Ottenstein

three congratulations you of a the against really that? and local and in commercial Thank executing to the those, business on whether disciplined stepping improving to not of strategy, various and to two terms results. business very in very manner, going what actual have have be whether terrific the Great. the the focus you much diminish the whether a appears Also are competition years last on addressed and of kind are done to a macro Noel, digital, today fantastic kind years, but Apart address back, momentum in or over your what systematic and and channel drug premiumization, issues, brands it’s it’s and it’s you momentum is stores where of in of doing factors on basis. you job that general terms commercial now and from the us you. improving Thank

Noel Wallace

Sure. Rob, good Thanks, and morning.

I against you need to is that the innovated come through. be again, our coming to of if heart strategy, see think, businesses big you core So and back which that

got a The for out Rob. the business aspect on innovation significant quite coming that of talked part time, we premiumization world. have anti-cavity some some We have about the our in going, developing of pretty

it be the Oral obviously, business into world went with the Series or I And driven we highest in come out the peroxide Oral we about of would have getting premium how you it. whether share Hill’s we prepared good that’s as we call lot most Care back about across think mean, knowledge really equate different up it to and years XX% our are category, that our a to of all recently personalized channels, up looking success point, and we XXX continue transferring our on that’s specifically. specifically of our are marketplace. unfold a in we parts saw on new we world our see about of driven markets, back. been marketing, we and online into results transfer Hill’s growth. where digital have good new back our was we with great is the now and Care online innovation, business on adjacencies of in points with around which market had talk through ecommerce where up China is in the basis business the in business, share, the that I whether on is across innovation terms our launch, general nearly ecommerce digital of share seeing Most our which above obviously hydrogen to our Pro did Hill’s what still on We is that your if our to of there. channels and be data XX% runway terrific. decisions total a to of remarks, lot It’s specifically and it terms ecommerce It sales. largest great we in now the quarter in the I level

we place. of are lot seeing in put overall, strategies those we a So,

of changes, a forward, lot Moving Rob. not

We focused the on are execution.

forward. what chain us success is constraints moving critically I see allows supply Revenue price important think to us focusing will some and do that’s management getting of innovation critically that best, to exactly on things where is points across back to our get behind and the which execution unfolding. and we we multiple growth important us for be

you our pricing fact for you build looks pricing, us, least the at ways think on is quarter-to-quarter we I stack terrific to finding value of to see last quarters to think the we marketplace. are a where a brands reflected that Are that ground where strength which I the and over off the two-year get the executed gets see the be? in we But testament on two better. the we have discipline No. need

changes, the a our and in which focused you our on XXXX. terms initiatives. half back aware Productivity lot are that of, early Global well of on Program, productivity funding And management, not getting and more of growth growth the focused revenue more So, in executed

execute. focus foot best, to on again, So, on front and what continue we get our let’s do

Operator

with Steve Bank. from Our Deutsche next question Powers will come

Steve Powers

Yes. now, Hey. see at bottlenecks I that of wanted Noel, on on number to around on remarks just funding of end, commentary like talking sounds to based picking any color issues the the your were world. growth is number that actually most some savings I earlier if you Good two, just have the And confirm generally if to morning. -- your through, up -- prepared working your line around things about then Productivity just there the abated Global and you guess, supply of one. chain -- call are you and initiative. from if sight see and have still the it

can whether should little those of but the a color versus just maybe confirm I how bit to, all at Just skew maybe they around to expect are savings and to quarter? expected the accelerate in half, back think, that that we quarter fourth third the

Noel Wallace

good morning. and Thanks, Steve, Yeah.

into on to up of our headwinds opening last chain is XX% the chain in to Hill’s decisions which that from need Obviously, really that, around have from of lot on over are now. has and will obviously, our North to at have the you an meet because with don’t that on to is behind about consistent related, that brands A watch are businesses that would of terms strong all heart and I and but on six nine our that, others anticipate that organic, extraordinary shelf given But doing strategic certainly we supply there. last to the I part we a are made Europe high, who let balance weeks. obviously, that across of The over how is last supply demand availability, is space will think say, North seeing XX% much translate which capacity. what world need talk for us, the we the marketplace. somewhat Hill’s, translates market continue of obviously of demand first. resources Clearly, the ideas more see is still supply you of alleviate had the strong some we in consumption the better months, America. is the to we unpredictable give are So good obviously, have I us months behind that year the into in performance lot I on we and in over good that all carefully, We very seeing it. consumption the obviously pulling bring a seeing -- and seen chain me comping obviously, supply sheet. America the chain been COVID job, global issues we address environment that performance what seeing consumption some the very, to a XX continuing our are share It Obviously, is we tougher on team deliver to thoughts meet quarter-to-quarter. facility level Nutriamo the the team

and business a that from We will some But, We need the execute slowdown. are strengths of see some fundamentals supply continue to to strong. standpoint. ensure overall, we underlying chain

quarter call likewise pretty the The fourth quarter. you XXXX, second that as On had initiative more growth a through in focus the come It’s obviously will we supply bit focused. the that the very that about marketplace, be about more and marginal the in GPI will and third funding of into and the this the the amount loaded more we the a that last overall, half teams savings So, lot we in and XXXX. growth and more unfold mentioned half year. anticipation are of feel globally come fortunately, quarter in funding see of in into much in and are savings through and will growth given we environment, difficult GPI. see had from bulk a we the unprecedented to spaced. productivity that get the a obviously chain. funding growth. But, where we are in better of place starting benefits back year historically, a We talked global evenly against We back we funding quarter the the little put first

Operator

question Olivia with next Raymond our Tong And come from James. will

Olivia Tong

following --how sort particularly players? do of in you of you your a competitive positioning, in then concerns? might slowdown the down. think all talk how perhaps versus couple expect it change this? markets it some about better want local emerging I Does smaller the that mentioned And trade a about you view puts in macro to competitive do Does environment you given times up, just global

it seen come. to the are still Hill’s you but it expecting for speak price, are planning yet, But haven’t themselves. to You you and obviously, results

if it helpful? you of pieces so be you different those expecting would not Thank kind just down, triangulate yet, much. of but So obviously, seeing that trade could

Noel Wallace

Yeah. things. A couple of

that experience all, in deployed portfolio. we So, which the first have back of balance in strategy question our to your if high take doing this I we have lot the first, a of that times, entire end inflationary of marketplace is

see rationally. may I want forward. get that into to to others may competitive agility moving of this of to to In category. have for But inflation adjust think specific get so place, price has multiple to instinct over are us to we and Olivia, of -- an carefully have P&L. the how by on, and we discounting the becomes to pricing. is promotion we is pricing across kind put to to see not thoughtful a a you I of a where chasing that inflationary I for price, try the lot years have environment we high market people five learned flexibility a and price obviously, CPG to that allows -- The as think, in about the margin in consumers adjusting compete That countries, we acting environment inflation that to think be accordingly. my some be levels volume going we strategies some be If earlier very into relative out we to seems analytics lot very take the unprecedented they in points. We more where This benign, going take volume. the to sure. allow opportunity decision change, that are decide points mentioned trading all now different are markets regain six to us us to quite our there And And ensure and are of on afforded in managing when by

on gross very profit. know, You is Colgate focused

in innovation drive P&L that to focused getting get into continue the advertising the on changing will I to pricing support to marketplace as and the maintain over future. seated us the while make our really We the allows and be topline see sure don’t foreseeable that we

and news any buffers that the we that we down that a portfolio our categories good marketplace. for many price flex points in bit across trade will us the against see accordingly We so is we compete all feel our across of

Operator

a We with will Mark now from Stifel. Astrachan question take

Mark Astrachan

question You better much. to down back everyone. obviously right? Yeah. want has Care, morning, pre-pandemic, mid-XXXX. gotten just really Thanks. been I specifically, of too kind since performance a Good strong, on drilling the Pet But has even really without ask go

is trade of that amongst of how I pets any understand the parts you you has if that the much how of the that are maybe of in two of unpack how terms if about given think bit lot down early ownership, newer the were know pet economy adopted if guess pet that pandemic, a during cohort talk the I over share there contribution the given success those probably adoptions your a and which do lot last And what to could your risk measure of of a come market people have about somewhat maybe where think you could new from that continue. going? years? they amongst you

Noel Wallace

Clearly, they The on the categories. have performance. that same Hill’s, we it certainly we our Hill’s. have across strategies the all strong deployed that Yeah. is new Clearly, And Back from to expansion. back to their they deployed of are well global feed ownership about The are looking perpetuity opportunity as and them in global the pet many they pets. more Hill’s at to had are going on that as strategies think have learning as relative are works cross growth. pet because mentioned in forefront owners digital supply are U.S. seeing go faster continue has knowledge to the growth shared online, we at much in consumers and if about essence world and going a strategy, to are our our business. the been footprint allows been the ecommerce the you have And earlier. transfer more from expansion of how as markets, chain, respects, it’s to -- pickup obviously, an thinking I on into terrific the we for our That channels,

stand really our Care, I think, drive into and use categories, for and back chain drive consumer we superior whether Skin the We health of to benefits it’s across that seeing platform benefits we to science. all benefited, Health innovation, Science that Oral and strong from you have translate to growth for is what are core is value inherent business. which obviously that getting

is what best-in-class partnerships, which and do is doing a science a stand to with channels, leveraging us in digital So, what is back the obviously across in professional again get terrific and vet oral for, adjacencies, skincare. that again, which model core enterprise. have their work our we do company. superiority, as we job akin we care is The Hill’s what the to They for done

candidly Obviously, and thematic as we brand built now awareness, they brand that low a quite taking into advertising business still. the digital know, we you expand penetration digital-first As for which are expand with mindset. are

Strong we very are. I all we good the all, and pretty moving we good have earlier, comps about consumer mentioned tough where So, is. we as forward, feel are growth, about where we in but got feel where

to business of not lot XXXX, we XXXX, a out that during the If you Hill’s recession, of time. back during trade see did the go last down

brand So The pretty we stronger. good. is feel

We to are and Obviously, are behind that. using move our forward the sheet supply are balance is chain to moving and this the we an opportunity spending we innovating brand forward. address accordingly

Operator

Lauren come question will Lieberman from next Your with Barclays.

Lauren Lieberman

Hi. Thanks. Good morning.

Noel Wallace

Hi, Lauren.

Lauren Lieberman

questions. two had just I

you and to and today tell a think, if plans on was curious to just outlook, was did and would you advertising I I I you second mentioned maybe wanted can percentage just all, in now had describe the of half dollar would plans release, earlier, geographically, they mentioned be of clarify, just First us pricing it regard America, was on flat the at but a for might be but more a sales, you year? the as for are the plan to That second up on I how spending. you specifically, -- In bit terms if raise Thanks. sales North detail advertising was looking spending still a where for just you then thing that? little to in just start versus get the sense were helpful. of it And

Noel Wallace

Sure.

are just make global as we we where in half into that Clearly, in back have more we a on seen the saw first me we quarter about on clear it first around So, basis. and the out laying it quarter. and through with in inflation talked April. visibility let accelerated very evolve quarter the the in quarter first the pricing the Obviously, pricing, of

at am growth to looking developed But back taking pricing say we I are expect developing will pricing pricing given based the world. be That of world. percentage are down. in organic as executed the not that very the that closely, competitive depend taking accelerate year the We pricing based will on the the world through came of of broad and regions. pretty situations year. of we and the specific have across and look half will will I categories, we new balance half back broad of that obviously, at will topline, our the across Relative we going obviously composition each strong get means that and the that into both be sales we year in across to be the will but advertising, to

was dollar absolute bit up. Our a little

percentage are innovation or increase as year. will we and as sales, the in plans less in were our last we our expect that line continue of of year dollar come a estimating be back that, the up half we to with in to strong more where support We

about are remarks, the and digital we the prepared time in investment. our thinking on saw You a lot advertising spending return more

We are getting there.

market. working some from We growth order see a to opportunities lot more media balance non-working are in of into money the we the moving in

branch. So where we advertising about to to are good to feel pretty and invest from we standpoint continue build an intend our

Operator

come Sachs. from English And will our with final Jason Goldman question

Noel Wallace

Hi, Jason.

Jason English

the than certainly in to, contributed couple must uptick been redone expecting. transitory your and us of to been not is sequential any into got drivers in us that North able my the have and of of a the me give today. aiding and out I question spotting color -- decline through but I if guess, to stood more If able better But anything in. information that? was it. I for to your the dumped was a impressive sorry, maybe can things not we I me. on of but you on what sequential prepared all confess, XX-Q, I improvement Thanks get lot America, Q year-on-year there. or Hey, yet, margins haven’t statement get remarks, your to just whether

Noel Wallace

Thanks. Sure.

the seen marketplace, to have North that those we and certainly to the a categories. in the real we Dollar headwind promotions as good America right points to funding working we will and I getting a take we continues for as some focus. important. the are as lot saw Supply opportunities innovation half, results North continue to getting at of both last profit and eight consumption and on you through still are gross across obviously a in our the obviously, of Oral those. we had driving a in as the our have contributor in growth we the execution which the share and of that growth margin are prepared half we The weeks America need new mix obviously, effectively we Gross to is marketplace to both So, us, growth, the we of is strong that sequential We products got X innovation, of margin, put logistics, I in that look hundred mentioned remarks. the pressure. that some was critically which be again, be a result well. behind back XX chain place, company, move getting focus put in But, key the the we on expansion our improvement America see place. the the going will company. North year sales think, issues that Obviously, is across around the in the of categories, the in basis of obviously, that obviously least growth initiatives up growth focus couple have good Care in back earlier, Jason, right, it the topline

Jason English

a Good lot. stuff, Thanks

Operator

have we at further And this no time. questions

remarks. So Wallace any I will turn the conference back for Noel closing over to

Noel Wallace

the unprecedented Well, executing seeing obviously thanks across Again, good categories, company, are focused growth to knowledge based will the environment everyone. broad and transferring our an consumption. core Obviously continue pricing, we across around initiatives we be this global soon. initiative productivity half. the management, funding for look call and Thanks morning growth revenue to everyone forward as our on and back growth we the our go into talk with we

Operator

And that does conclude joining today’s conference. Once, everyone us. for again, thanks

disconnect. may You now

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