Colgate-Palmolive (CL) 28 Oct 222022 Q3 Earnings call transcript

Company Profile

Participants

John Faucher	Chief Investor Relations Officer
Noel Wallace	Chairman, President and Chief Executive Officer
Stan Sutula	Chief Financial Officer
Peter Grom	UBS
Dara Mohsenian	Morgan Stanley
Andrea Teixeira	JPMorgan
Chris Carey	Wells Fargo Securities
Bryan Spillane	Bank of America
Jason English	Goldman Sachs
Kevin Grundy	Jefferies
Olivia Tong	Raymond James
Callum Elliott	Bernstein
Lauren Lieberman	Barclays
Kaumil Gajrawala	Credit Suisse
Robert Ottenstein	Evercore
Jonathan Feeney	Consumer Edge
Nik Modi	RBC Capital Markets
Mark Astrachan	Stifel
Steve Powers	Deutsche Bank

Call transcript

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Operator

Good morning. Welcome to today’s Colgate-Palmolive Third Quarter 2022 Earnings Conference Call. This call is being recorded and is being simulcast live at www.colgatepalmolive.com.

Now for opening remarks, I’d like to turn this call over to Chief Investor Relations Officer and Senior Vice President, M&A, John Faucher.

John Faucher

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

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

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

Noel Wallace

morning. joining thanks Thanks, to and this John you all for us of

We high continue delivered operating In we strategy quarter, every deal to growth growth the third across very we growth that with remains environment division. execute organic volatile. sales our single-digit with an as

including growth Pet elasticities delivered also topic are our growth high I categories, all Care, four in big Oral We this Nutrition single-digit Care. quarter. of conversation Personal of and in know a

management in significant, we us sequential and raw would the Productivity from We through well material uncertainty packaging in and margin growth through are initial we While with these raw headwinds or our foreign whether logistics and as underlying quarter, the pricing Initiative. in believe elasticity Global increases in to exchange, prices. delivered and constraints volume but and Growth Funding quarter volumes healthy our third This XXXX the the are strong growth gross benefits remained improve chain despite headwinds The positioned expectations costs face, sequentially issues. were negatively line deal drive quarter supply impacted further macroeconomic reductions of we by a helped performance retailer in abate. productivity revenue Hill’s the fourth and in improvement we with to our inventory materials expect these

necessary We productivity, pricing, to actions well deployment positioned leave through these difficult head on steps actions. challenges and the have meet capital to stabilize. our when These taken other us markets benefit

The is portfolio. first reason our

the of high have shares value value to helps largest – in to Consumers our after brands and to This two offerings And we loyalty. breadth to have to has time our professional combined value number We when given have or positions brand number of premium. meal. have products our to a label in multiple our model our we of built across segments tiers four key our of generally have several in they portfolio of everyday: our categories our over don’t brands, also with our when look consumers, ultra teeth deliver to homes, differentiation builds many elasticities recommendation categories compared they market across And we and we level compete. with entry which been provide particularly usage, feed and their shower, brands provide many to price brands where consumers, from customers our categories. in competing and with leading one this they use the their trusted focused all across Oral their added hopefully, and of high every pets We growing despite clean significant strength our private vast categories of focused price other they market tiers. when of true categories majority Consumers low believe when shares Care pricing. frequency particularly helped HPC brush

building are and we because in positioned them well the both order in growth then capabilities now the also scaling to future. and are company drive across We

particularly when science-led capabilities add Our it on a consumer in important categories, time focused vital there identifiable is pricing are value. is most to innovation, in so our much

our many here chain, world. are our Colgate AI even how transformation, area of talking Revenue like new in of time e-commerce Prescription product trends. the of our Hill’s and our our impacting on Optic is brands Barclays we development lot are a is another advertising, a performance, can is improvements You management It supply an business: we helping across growth doing training the EltaMD scaling capability around Diet, others. facet market every drive spent that ROI White, I the progress the see our digital-driven at and to use our organization. about share also and digital of

We RGM’s are is force data full and putting RGM effort to elasticities. and helping this to to analytics make decisions our into our believe us of planning. lessen the team the impact of also We help

Q&A, want scaling and through that reiterate our uncertain and brands, are I strategy environment capabilities remains the working is So believe that volatile, and importantly, great we people. positioned an as into strong with to we most we head well

the So Question-and-Answer will Q&A I turn it now. Session over to

Operator

Our will come from [Operator today Peter ahead. question Grom Please go first of Instructions] UBS.

Peter Grom

everyone. you good I are Hey, morning doing hope well.

Maybe term? importantly, potentially I maybe but growth in discuss business confident to organic quarter looking a inventory the in Hill’s. remain wanted chain sales constraints in Thanks. quantify out retail mentioned organic ask in acceleration the on can more in And I could the of had sales So know is you to supply you impact the specifically quarter? then you the there first, to potentially double-digit September, way you and why the longer return maybe reductions and on a fourth

Noel Wallace

Yes. Thanks Peter.

with I we – And business that the quarters go the of it growth nine based obviously, fundamentally strategy. obviously underpins to the supply that chain in Let is chain high think the same me back supply we which for constraints double-digit have quarter, some on earlier the demand as really brand. And the of on had had network.

that building endorsement of across elements really we of quarter our is consumption. the moving up Collar into core of Red happened strategy, technicians business the back our for have that general strong Ultimately, for that translate at run brand. to So part drives is ahead really supply We our vet to science-driven in consumer, acquisition forward. market pre, to and made driving you early the We that acquisitions is free chain obviously if capacity the e-commerce Europe. translate digitally claims the vets that the of shares. the the innovation What claims in ability go of enterprise capacity, now obviously, the the XXX% and we

a be existing our more facilities. efficient production do lot to We are going in able to

that We Collar of upstream October. are a coming new into lot Red as of transferring the are volume facilities, which

quarter exited we So we moving feel forward. And back as you growth. double-digit in very good mentioned, the

X in are about strong very next So in in plants business, continue the as shipments where the operate consumption network. the X obviously, shipments and we outpacing excuse – existing to good me, the efficiently acquisition Red integrate more we consumption, months we feel and to our outpacing Collar

Operator

ahead. question next Morgan come of Our go will today from Mohsenian Stanley. Dara Please

Dara Mohsenian

Hi, good morning.

quarter. So, obviously in strong incredibly pricing the

quarterly growth that haven’t decades. of level seen in We

competitors about content adjustments pricing that or just given forward? you with such helpful be there seeing are follow be would are line needed you Thanks. Colgate might going you out competitively generally it Are pricing. price strong what there you seeing gaps? think that Are understand to So as

Noel Wallace

Eric. morning Thanks. good Yes,

go discussing articulated year. obviously across quarter, quarter. and as took the to, continued in what third That pricing second other have Let’s all North been the we We particularly back America pricing again, in divisions. we obviously

it’s that has markets pricing and P&L. led our business many to critical the pricing of growth been We the of believe in into have now. get We the to fundamental the right

have competitors begin We now to seen follow.

as quarter, feel with saw good We will where very should the of past, some as we we pricing. pressure with So I the in discussed constructive feel but that market, obviously that continue the to we see in competition. alleviate are very that have we hold a the that about market volume pricing early

we categories. Now most quarter end was have later little of the competitors followed our slow in follow, in seen competition that but have core our the a that of to

talked elasticities pretty upfront. are with feel less at good. We in or we So Barclays. They line about where articulated we more

that more pricing the of again, the is of a seen ahead now little some pricing in took have Care took following. we Care competition But and We Home bit businesses. competition we Home elasticity given

good So, pretty manage where we are we is the we now. dealing very expect that moving with Obviously, of to volume we price feel exchange right foreign how overall, we about alleviate about to as feel where move and lots forward. team forward, discussions we we on dynamic But are good with the but having are. new

Operator

Teixeira next question of JPMorgan. Please today from come go Andrea will ahead. Our

Andrea Teixeira

Thank you. morning. Good

mentioned, that fact I also competitors of comment you as your I pricing hope I as exit volumes takes, the to know bit quarter? Noel, on to not volumes quarter? to comment you your way you the with Hill’s and want alluded a can pace think X unfolded exiting were now X Should the the got months. you. the it you the expect So acquisition. to bad we you reconcile, quarter the better on like Thank alleviate. then are that that following just

Noel Wallace

of about, some stage, seen inventory exited we to We it obviously warning headwinds quarter, quarter basis additional partners had we about chain We in in continued we basis post and in signs key the the communicated reductions roughly of ultimately constraints. we might on end impact saw We saw talked in that’s Amazon chain the Hill’s. the to the but as points our at early taking inventory throughout on you North had in as some Take constraints XXX the quarter that upfront brick not trade the supply is say with out and mortar as some online on exactly the improved remember of saw the in and happened. towards XX that what quarter some happen Russia Volumes business obviously that obviously that some points come We Andrea. which of Barclays, the quarter. led of Thanks, on of down. Yes. not talked supply that, America. inventory retailers

quarter. about we pricing improving market out, lot good to is in the have mind fourth feel there that a be across the in categories. consumption of Obviously, seems going we bear but holding multiple volume So, to sequentially in

continue So we that to very will carefully. watch

in the to to short not back had we this and these Europe some consumption obviously advertising across want exit do of of consumption investment. cutting term. the constraints the volatility is We a most to bit slowdown Hill’s. quarter moved strongly. We drive to be believe have obviously the in on quarter continue categories saw We hopefully, money also the that and we as little fourth year Hill’s, pull to

drive behind move to is invest continue we brands XXXX. Our the focus into and consumption as

Operator

Securities. Fargo Wells Our go question of Please next going Chris to come from ahead. is Carey

Chris Carey

just margin Hi, good good about progression, you pricing sequentially. you and But the still really impact worsened commodities next and remains coming and gross feel ease on morning. productivity strong Can how perhaps will ultimately, going into a actually forward commodity quite comment story. year presumably in

feel quite So you can on reinvest need in it within in commodity the general, like the volume drive are pricing? does things like and with you of some a bit here net forward. do pressure But what reduce you side, to demand to ease might weathering of and promotions these are perhaps going going feel seeing you context pricing are that back to

give if over wonder on about I So progression could gross how time? margin sense you just feel Thanks. a you

Noel Wallace

Sure.

then felt could. bit Overall, conceptually take more coming give much let of about into and Stan pricing ahead Let as talked get carefully – the inflationary strategically, to strategically me and we second we obviously me it very a We was we turn to consumption. it as top the the environment to color. little watch quarter, very that it and just you will over as I take important with

in we initiatives Global of headwind reconciliation. line, combine seeing in out through profit obviously, important We despite You to profit gross the points quarter this, our with that very which Index. coming was get that on that in announced back XXXX felt XXXX. set up for with gross we Productivity ahead And sequentially the the it XXX gross the we margin of are

necessary. we those of to to important right So will get as turn you it we where materials, over will a Raw pricing feel to I was give in that Stan and are now. continue that flavor take to

year. Stan? more We are seeing versus we have but still significant pullback, or of seen where less, little last a increases we were bit

Stan Sutula

Yes.

So we to increase. in materials billion materials have But seen we year some XXXX modest a cost. raw as continue see as movement full full overall, $X.X year

little of then. bit been our highlighted, Noel year-to-year. XXX kind lower call, quarter, now it where so has points, as but As underneath color generally a reminder, Oil of XX% creep back was the that’s has it third last In to since a was that.

We higher previous corn, in offset our has we an actually Partially those proteins, have and increased versus in oil particularly versus seen here. come amount. etcetera have were where we offsetting around that, ag as guidance, It July. seen are notably a decent palm

but favorable, tallow, oils inflation. and elevated levels still that’s Now, showing other are soybean of

$X.X that’s So, the billion keeps for what at us the year.

typically As a largely reminder, in, this are fourth locked is lock exception, quarter and in so we for no quarter. we

Now one per plants, been Europe. while the escalate. to to common it power volatile natural se, of and a use our continues not particularly material we is – do And gas in raw that’s

we GPI as program, overall, look billion. still take expected, Funding So see XXX this $X.X point productivity why Growth our mitigate we to is to the as we headwind. raw move, program have our that And to continue materials but

Operator

come Bank go of question ahead. Spillane Please Bryan America. next Our from today will from

Bryan Spillane

Good as far up ahead in is material out? Can operator. could – sense costs us I for of just at And you have are the been, begin in kind look there maybe XXXX, terms of costs you volatile ‘XX? in last Stan hedging on a just to we are locked material or how you Thanks, locking how if give morning. maybe being raw just raw further pick given on of question.

Stan Sutula

for question, the Yes. Thanks Bryan.

we look, the So seen as volatility. we’ve

movement number out $X.X the While we’ve last exactly the up highlighted had quarter. down, billion same is we of and

it’s and we’ve movement a modest on only seen longer-term we’ve some quarter, we in typically We pricing mock move quarters. seen down, in that components lock net But next basis. up do, relatively and that, then while into do the modest. So out

quarter at we What near that looking the kind guidance. XXXX movement see. to But is expect, are the not it going most, today, you’d down. and of As we’re gets then give we the scales

moderate sure then think a we And are trying we’re going hedging. We’re not over locking on to prudent do we don’t make of to very that areas in time. lot

don’t of in do We do we a hedging some we is So the hedge. ultimate price the but think others. space, ag among the lot

Operator

Our come Goldman ahead. from Please next Jason of go Sachs. will question English

Jason English

I’ll me for try in. morning, folks. squeeze good of in. slotting Hey, couple to Thanks A questions quick

So the And know seeing fourth two in certainly secondly, back Q, to sales numbers. round implies we’ve moderation by quarter. is Still inflation, a inflation, suggests but in the A, our round than quick reasonable that in you less And billion last math quarters. they $X.X right? what your I been numbers amount are of of that the give on percentage category.

categories. So lot you a elaborate Care you. seeing what that there individual can Home declines a year-on-year Care you’re categories? within there. seeing be your does you’re it Personal bit suggest But of Can maybe little and in those on just variability Thank

Noel Wallace

Yes.

and categories. good Relative color but in Pet I’ll Categories, growth estimated. pullback to than the Care be going Let Obviously, by particularly a I foreign them the are large, quite there, me categories Oral on we other Care first, we’ve Personal of all from year-on-year, bit quarter. we see that, more nature are let see little across Jason. our take given continue that’s we impact the healthy, terms seen the may Home into the we then little categories provide up. some broad and to categories, of There But pricing be the materials exchange Care, Stan and Nutrition of our a how mean, in category. and where raw fourth a where play

Stan Sutula

we And in said to QX. last on going in thought raw is Jason, we this that peak our the materials, call

that. to continue believe We

slight do locked for expect again, some largely holds So still while in And at full in QX. we’re that. $X.X billion, the moderation we year

Noel Wallace

those I’d is area Science use and one ag quite of The we continue some specialty Yes. prices add Diet, to Diet high. and the be in that ingredients Prescription

So those we we’re into carefully move quite watching ‘XX. as

Operator

Our go from come ahead. Kevin question next today Grundy Please of Jefferies. will

Kevin Grundy

ask Noel, parts strategy, to it. Wanted everyone. morning, Good thanks. question Great, on portfolio pivot, to a two

one, the satisfaction The the of level with overall portfolio. first

the there where as to has there part, sit which here recently, pertains us value As M&A. business Love want well any augment is a a portfolio, second potentially perhaps to And the to done today, latent is it Thanks Board’s thoughts approach related view get here is you there, through in that business. to in of the extraordinarily your would assessment. you portfolio thoughts the some which specifically marketplace that. Colgate updated remind on potentially to Hill’s, for

Noel Wallace

volatility, curated carefully we really a Yes. world in. pleased we In diversity are the They the significant Thanks of for categories. of question. categories are compete with the

highly four. We’re on focused

long, on been long As time. you a know, focused four for we’ve all

We categories. And some well not lot well whether they opportunities, constructed Nutrition the have you’re deep going tandem. over premiumization. run growth the of we’ve for opportunities terms are looking to believe you’re that. in whether at And and you’ve years, of are seen consumption future the those they positioned Pet at all obviously, pivoted of four great success understanding strategy and price-driven last in We in done that obviously X categories. in We’ve a looking things

today. of and want is flow in feel we four, ebb China very of to success skin world. those we’re and continues on Chinese very focused You’ve year we’re this lack around to we professional our U.S. And Very broad-based that in Obviously, be fortunate the given seen skin business growing in of where the consumers very the as categories, right the perform well. talked exactly the overall, Filorga about in But our growth the I feel all we’ve business categories and which driving a Yes, across categories now. with travel health. happy initially. be the the seen are challenge, we China of to continues all lockdowns

Operator

Please come ahead. of Raymond from Tong James. will next Our go Olivia question

Olivia Tong

My more you. question thank Great, around was Great. expenses.

and a the it mat, of then most advertising, commodities that a was disruption on of kind possible on if to played out First little color. constant a basis? currency It much part currency like just in versus parse raw related sounded And to is give could on inflation bit how more you Hill’s.

a little of some we’ve Just sort advertisers. what color heard you. digital Thank from the more your bit digital the particularly expectations, given of ongoing aspect, in of terms in

Noel Wallace

the me start expenses with piece. let So

So operate in over on countries XXX we raw obviously, and territories. materials,

that materials. currency as raw also you portfolio, our So about overall our impact impacts the think on

So I any one. wouldn’t say it’s outsized in particular

materials impact while they’ll suppliers, a one sourced are have are outsized aspect. others so And if have from hedge, sourced a or will, an natural currency two Some locally. those from you

So the FX, with about you that the think will company, largely materials, about to think impact you overall that slightly as impact raw by the of line division. in should and vary

Stan Sutula

heard Olivia, advertising, down a we us basis, were you X%, basis, about X%. on local dollar on currency were On a say up we but that

in we lot markets. overall, of feel a with still impact the of of our with optimize done having So spend others work, XX-plus now, our digital. we’re the spending done, XX% to have of obviously We’ve as in good really spending plus a move our

to analytics get more the and the deep into much able We’re ROI metrics.

We’re doing better our personalizing a much at content. job

people important of media on talked transformation, our being world part an I’ve that. As XX,XXX before, the about around over digital

we a a getting pretty little pulled much significant So better. feel categories. we back in we’re the saw Europe drop off in We as

quarter about but we back pulled to moving transferred little in capacity. to at I investment that continue as quarter the into on consumption Hill’s, we earlier, prudent And as fourth mentioned as we money thought drive the bring And to more a so forward. we be third wanted bit

Operator

will come question Elliott ahead. Callum of Please from go Bernstein. Our next

Callum Elliott

question. for thanks Hi, the

Personal the be Care, with of ask view overall specifically to parts Personal Oral it would those Care portfolio to the operational and Care can company? you okay. how business about a Another you, of to businesses of Home to businesses, Home Care, Care, you of difficult Personal Home separate if or if the please to that’s all just the wanted Care Care with change and were talk value question, integration the about I

Noel Wallace

strategy all I drive in well illustrate X% four how the Oral going growth of all that we and integrate delivering our back that gets part endorsement. the What strategies as pleased, are the our this heart every enterprise. Care think in we’re strategy, and company those XX performance the for X% target of how talk and obviously, your of of lead today within to Nutrition business, now it’s substantiation capabilities overall about which products Yes. key businesses and quarters that why science-driven acceptance, Care, the business. to think I do We’ve our quarter working. drive particularly results our is clinical leveraging with to growth of – organic across our division sales categories. about had And range. I’m our Personal businesses strong our our We’ve we’re is across again our scale step our for of in question, growth to talked capabilities And approach, Pet as consumer the professional high business A single-digit claims, growth

professional model we Oral our health business as Care business, our you strong as skin a business. As have across our well know, pet

We’re learnings. those leveraging

years, is of as equities In a saliency we professional the how last an New the recommended York our brand for key continue the over simply we see and and look we most often driver loyalty. put to ultimately sharpen at optimize and strategies in organization brands to fact, X.X

largely Hill’s. by transformation digital led Our initially

We now talent capabilities, the enterprise taken digital entire further have to their those and across use capabilities. their our

channel businesses we have that business e-commerce fastest-growing our of the is today. seen one You’ve

that market the other outdelivering which biggest really attribute Our leveraging e-commerce the competitor scalability of capabilities are across like the is in in any And to shares market. China, market, markets enterprise. the certain against we

today. lot of we’ve that see the a continue delivered of in terms of a And like executed categories compete we similarities, that four to again, overlap. we So we the lot in, results

Stan Sutula

add supply One our integration is extends I there, that to thing I’d think, chain.

that production Home a Care, gives key is the Personal we lot integrate particularly Care that of and across us our leverage. Oral And across here of One we that attributes do and Care, world. the

Operator

today Please ahead. Lieberman go come Barclays. from question next will of Lauren Our

Lauren Lieberman

Great, guess two things. morning, everyone. thanks. Good I

quite it’s a in think Hill’s that Latin commented I First you’ve me on bit in America. But one the out much off elasticity the thing calling performance And out jumped feeling and just inventory is to – North destocking job was then very line. nice a in saying and volume you’ve America. done

could other just face companies, in – if think give what from kind resiliency you I we’ve a better pricing. looks of seen So the like of bit

So curious I more just it your XXXX. perspective if just curious there And on is on on Latin just on well. some pricing curious for for Thanks. more across be you offer was could that view detail Is think internationally? broadly different your America? into as do How secondly, portfolio? you inflation much space some domestically in I’d incremental terribly versus grocery

Noel Wallace

Thanks, Lauren. Yes.

to me America. Let talk Latin

fact, trips Brazil and Mexico. got from In to back I just

information fresh. the very So is

pricing categories took the across in is time that of led as in America. little And mentioned Latin we took got all in up significant catch as upfront, for America, have others others to Latin catch elasticity our obviously, the saw up. be You leading, XX% quarter, I obviously, the to And when haven’t we a higher. of about a you pricing bit in pricing following it the going second result XX.X. And

as in little see move we see Home across exited Oral we and I quarter, that – to Personal stabilize recover, improve, will a but Care, and in the forward. we volumes pricing think started a to we good fact will But As really, I Care. we Care see follow slow particularly Mexico, were very little plans Brazil, Shares, that the given in both Mexico really strong. in saw took initially. the particularly overall, soft Care, place Oral competition aggressive we Brazil in

markets, followed. leaving As I competition was those

quarter the strong. innovation premiumization plans and good really, XXXX. And we have we pretty Latin in look fourth move the So place we feel we place America into into that the really as in have and plans in

In we grow share Brazil, quarters. quarters, sequentially Mexico seen the our have premium of in over both six segment fact, and last five the

we good are So there. we where feel about

the move continue relaunching core and ensure core think so value how is overall, forward, we America to in listen, importance businesses, that past, going to talked down the there to as We’re trade some our to fit. we point, opening fourth XXXX. in everyone Relative for the we’re they also, as the moving our deal provide we’ve see do of consumer, into of see about that Latin price quarter inflation at about I good and with we feeling businesses that if

We to take continue pricing. will

key us is to I pricing in building brand us take value markets building. that more the think continuing invest the to to aspect to and for ultimately drive And behind around consumers. our brand continue allows world the

more more we opportunity anticipate we pricing now has see Absolutely. grocery? inflation the will I can And will there as the competition watch we innovation constructive. Is continue carefully. very that stronger people If where we we behind elasticity. Now brands, in our that it will market, minimize goes. been bring into the to becomes to invest the be, benign, which most think expect to But environment

plans We will fruition. taken we But we have about place see to that now, pricing elasticity. as it where right and the to we feel minimize comes good in have particularly

Operator

Suisse. go from ahead. Please Our Gajrawala Credit of next Kaumil question will come

Kaumil Gajrawala

Hi might Obviously, of talk pressure. most an the more delivery in be maybe little morning. bit where you consumer amount the quarter, can but area is we a be the Can area also an about Europe? under acute might guys. the Good the where see most inflation

maybe just you outlook as talk we if the your particularly can Europe, So, winter? are into going for about

Noel Wallace

Yes.

around Europe right. energy particularly certainly pressure, under pricing. are mean I You the most is

the go as – It’s quite gone pricing others in in you Europe We that’s look pricing in as some business at significant taken time. have. back that history, and have it’s into most the

strength two those the The covered the quarter Importantly, you premium in Europe. points mainstream, of a Meridol and year. the obviously, our we in in grow at businesses and have and the share have the in good more obviously of price Colgate, mix combination our of seen Elmex side, brands,

good feel about we So, where are. we

on mentioned re-launches pretty I more early home got As a our But home businesses. across bit earlier, in XXXX we the the I businesses. world, elasticity coming significant have think some care consistently care little in

So, we to we in the to drive about order good feel continue in consumption there. place have plans

be it’s a overall, to tough So, winter. going

are very we at But to with mix six We have to deal obviously, ahead tough is to months feel that price of a brands have points to different watch going deal going got closely. We good the with. a inflation Europeans. significant of that consumer the

Operator

today ahead. question Robert come next Evercore. from go Ottenstein of will Please Our

Robert Ottenstein

Great. Thank you very much.

couple questions. of a follow-up sort Just of

on can adjustments, terms How on second, you could Thank confident adjustments that the the On us We – to be are inventory reopen? market retail e-commerce-related you then is you. about done And there inventories? how side starting doing there are of And give in point? How And there? the this a that the is in side, that that’s anything more trends? are past. share details you at e-commerce the any lot market is talked where China?

Noel Wallace

morning Yes. Good Rob. Thanks.

availability decisions and and on-shelf quarter. On they case obviously to democratic the happens inventories, take that or we towards staying the that which Barclays bit our traffic they categories end a with quite can’t the may as is are run I saw We last mean our them towards deal much very drivers work end portfolio, and reducing have. very in The they at with customers, make we day. with particularly of they unexpectedly the the and we I We of if which goals builds particularly is the the I as significant second do stocks, the done, obviously of think across guidance out to all close with come what are we categories quarter. are that these in mentioned, up quarter inventory adjustments, Invariably, back inventories, across the obviously, on the call out big communicating prediction. it Is compete. to on want we that thing follow necessary. collaboration

done, that will bring on strategy So, is but transformation it usually terms something those which we or say. the below the they talked That me about have to to of it’s where difficult levels hard ground, great is significant our we X innovation go-to-market carefully. China, A inventories. they and that the for managed from means very have quarter watch some them for to plans. our China years in very their to predict. back entire last historically closer, marketing have It It’s our will was of over of to

fastest-growing have the of We be seen brands continue e-commerce e-commerce in market. one our the to

our seen of couple over terrific. which business last the is brick-and-mortar quarters, have We stabilize

delivered enterprise. quite You re-launch into quarters is positive greater growth for & Hazel, the we delivered the brand, Greater brand That’s name. across gone for the region, significant, the This our significant – greater the saw re-launch Hawley that We positive had changing volume Darlie the has pricing a our successful. we last and been China two effect. were

well. Colgate Our business continues to track

So, overall, we good. feel

premium on overall, Now some Filorga no The our of on an question, the sales. pretty have But They we business. lockdowns feel impact have had impact. lockdowns are. impact are into those a our brands translate we good a significant as we have about typically having had slower significant seen where online

as more And ground capabilities we market. open stable during That we go. will months. We the a XX predictability, feel where very the where will up a on and back about of the that to we terms in built comes what are good see lockdowns difficult

Operator

come Our will Consumer Edge. next question Feeney ahead. go Please from of Jonathan

Jonathan Feeney

follow-up of much about deals. off to efficacy. buying just is picture I your wanted very – to everybody comment The on I Thanks promotional going much. people structurally. morning. you wanted promotion about But to big talked about I people debate how any dig back about more is is and much wondering are trained have you could Good thoughts in – come big about how have gotten know

a worse promoting better promotional is where you more coming anyway. than working your a little developed particularly and efficacy in. North in, – more back are markets? now bit promos little-by-little promotional Thanks. little expectations, How It’s or bit say, is America So, Europe,

Noel Wallace

North Jonathan, America. more it the the inflation, volumes would relative think And becomes be to as characterize promotional more Yes. for question. at for be can world. I for where somewhat they of generalized rest are, in astute thanks looking the least I strapped the particularly a promotions. consensus Clearly, consumer will at

volumes deliberate. deliberately are That slightly was promotional – year-to-date. Our down

We some drive on much doesn’t have your volume, but couponing pulled for P&L. back aggressive can that do

in be continues them. least have X U.S. up our in two to would of consumption But bit the taken that some saw of numbers, our I at or XX the North of strong. strategy, little up key seen our our were have very not say a promotions America, We you all follow flat competitors In their we U.S. competitors categories.

Our bit toothpaste And little innovation promotion. on continue toothbrush that a perform business to we have back business and quite good with with well and growth. share pulling done

fact looking your we lot portfolio comes really carefully. consumer on that entry good very it revenue to ultimately sold are think and have down to to on carefully. we the competitors. clearly, to be a more I I that have premium the I to volume in by of to would giving watch little trade competitors a expect more drive and the to mid-price we to ability it will effectively. And the that to to that customers think normalized your management growth moving levels does price the little point, category to work bit in promotions will managed going the points moving be our given forward, forward, sharply our watch to and and drive more the But to Again, much A bit of gets by that the But go see done volume proposition think home. value categories promotion our a categories. heart where returning balance you point in take will order Now, very how and price leverage

Operator

question will next RBC go Modi from Our Markets. come Please Nik of Capital ahead.

Nik Modi

just same dynamic. fill categories reconcile everyone. I hoping play At the are inventory Good am you. the frequency. you can I recovering. which the destocking in time, morning just was Thank rates thinking high you about Yes. are Noel,

on just extra perspective frequency, purchase decision little helpful. are say, and purchase people this of wider. store, getting a care, let’s based oral is retailer out are Any be dollar-based the squeezing is a across a within are tube, the broader holding cycles little So, their inventory they or that around would that

Noel Wallace

Sure. starting Trips little a but bit. to are down, turn

seeing We our changes bit significant penetration are a little across Consumers household may losing categories. less. obviously, not be in,

their upfront, look our watch I full trade at, with take basic more, basket stocks. items our costs, trade been partners frankly, some to down out slow. forward. volume obviously, will We quite have in of of watch has shifts and trying as mentioned just in moving more We The driver very had watch, We very, They inventory inventory particularly to manage that of to they across discretionary their partners. as the see have deliberate enterprise. carefully

are what’s a good they obviously, we across business priority is all we stay in Again, back I as stores. to towards these first to becomes more partners back take will to what what on think we things feel the them need. more good they deal case to up that’s velocity stabilize, But supply of difficult. a chain give fills confidence going their drive as categories standpoint, visibility the going down do because up, traffic looking with quarter But us look early had trade these their end and where about predicting Hill’s, that of from the the the as are levels, to exception at inventories high we the which gives Our with constraints mentioned. lot our are trade lot I

Operator

next from of go ahead. will question come Our Mark Stifel. Please Astrachan

Mark Astrachan

everyone. Yes. morning good Thanks and

could or Just about And – would retaining? the just And your Second, categories? talk questions have remind pets, more be about bit know you just a thoughts maybe Thank were you. if your on some would could me. perspective, standpoint any maybe thinking you how maybe if you a you been maintaining discussions few that talking What on of has questions if for a be are a sort pricing, comment be any but retention? that pricing, I in of that that about deflation? there you talk is what the broadly global taken? of just global And terms your there from in in would sort One, helpful. for then change could particularly volume the retailer expectation on about domestically, growth taking pricing of us basis,

Noel Wallace

the expect pricing but today in of consumption I overall, more that Global or the volumes, categories, less think tracking X%, X%. their there. purchase ebbs mentioned little Consumers do recover. you into will We and cycles, Yes. their to and will as a pantries quite we a goes around volumes elongated. to bit Sure. obviously, shy market, flows get as to see we more little earlier, are carefully. But value watch X% X% maybe And

pantry watch – seen We inventories. we have the

But seen are are overall, category to a generally come have And bit we in of We global down, growing expected. mean at X% we that above range. but be the little that I looking that’s around the obviously, growth X% world. to

better leads better And at so our that consumption obviously or to least on categories shares.

into strategy we use that continue in interest value terms of consumer, points, of they we innovation in of of RGM categories, taking lot different brands to we bringing for and and And not price across new that, our have them in are proposition pricing to that time. something terms is consumers. have longevity that the that on It’s equities. largely, and we pricing. lot ability In to a re-launches our frankly, to our to our a spent There just quite retain value have depends adding been talking to the the all about ensure the see are

been innovation ensure And we are price architecture, have just not very claims, to careful etcetera. that we whether it’s terms through of pricing value, better in bringing that so etcetera, through pack science-driven it’s straight

we significant innovation market. Specifically very The launch, Derm Complete on Hill’s, that innovation. significant the we diets that the obesity I about have, the innovation much strategy in think it’s have,

increases communicate and that with consumer value price we So, that real can we justify drives that the have. the

So, strategy, against will we forward. execute categories the price and we to moving we volume that watch will balance continue as and carefully

Operator

Powers from Steve will come go question ahead. last The Deutsche Bank. of Please

Steve Powers

improvement you want get whether outlook I was just saw the to on I spoke is guess or perspective Europe, actually or to a but like on bit, and worse thought back question before go better or a I not European on a you it Thanks. horizon. be getting little playing which Great. Well. your headwind not about guess or gets curious more profitability also globally? whether here it and that, you and as maybe going this competitive competitors, other a and what more as the your pricing into of maybe some considerations – And in the obviously seeing side FX was Europe are of on from profitability or I are to that it’s maybe perhaps of I you part may how to considerations wall European-based

Noel Wallace

has an incredible Yes. pricing get Europe of P&L. in been good had this quarter. that undertaking Obviously, the a level to

in a an have quite the there had that, around real seen long, also, the the in and across It’s be board. You categories. the that trade know long the ability a to doing job. lot work back a to focus to think – can that to difficult, but seen take bring good think we of have growth extraordinary I management. we new the haven’t revenue of pricing categories, we lot Steve, is Europe news opportunities are underscored you I doing and plays it frankly, out time. plays the And

the grow led strong pricing. have to on Elmex that oral have Europe. we business this brands of premium environment at the We fact the in side continue care despite in Meridol in and Obviously,

at So, where deeper we need exactly those ensure look good the continue to mentioned categories. again home volume drive world across I that care we the about business to the challenge, we taking to we do and very in are are. is feel more pretty what we a

and businesses up, In little guess label. have in it Europe. mention, America. in we of have home would private shares, seen all got a you strong I our care inch in more bit Europe, down across that. label, will need expect mindful in as We to be a North point Private you but market categories I

key be to which about the P&L, carefully to that watch moving we of. are given aware we months, the us will to challenged everyone the So, have is do in to that leverage inflationary are how six continue well under to do in execute successfully. And very forward. next going we market a pricing things are getting the This that. thinking to that need they pressures allows the we The is need that is –

Operator

remarks. This CEO, President any concludes return call. Wallace, now our Q&A Colgate’s of Chairman, portion and the will to End of I for Noel call closing Q&A the

Noel Wallace

everyone just Well, back couple I good come to to a of concluding Yes. want thanks and questions. remarks.

off. a As we all we stream The encouraging, all pay our in strong continues we innovation our that’s six over changes that putting lot a are innovation you to how I how of impact we a drive profound sustain made is having growth testament four broad-based the to the is and strategy of seen, have that’s think the RGM, categories, divisions, market, have how years, content. businesses, transformation making driving core premiumization sure last level. the couple on drive particularly we operate The the we at around entry digital in world, the

teams team So, terrific the we proud sales the straight now the to are executed important but on deliver X% of The XX And a line well really the to headwinds is X% our or There most of organic continued and growth. a X% amount am of in strategy ground that I think forward. organic, moving we of And portfolio how we we the a business, has quarters against tremendous positioned have this been the are target. either work above doing. very proud delivered quarter have quarter. our was has

you to healthy you look wish in I all of end of a forward that, I safe and speaking And with So, the year. to January.

Operator

for now concluded. Thank has The attending conference today’s call. you

You may now disconnect.

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