Colgate-Palmolive (CL) 25 Oct 242024 Q3 Earnings call transcript

Company Profile

Participants

John Faucher	executive
Noel Wallace	executive
Dara Mohsenian	analyst
Filippo Falorni	analyst
Robert Moskow	analyst
Bonnie Herzog	analyst
Kevin Grundy	analyst
Stanley Sutula	executive
Lauren Lieberman	analyst
Kaumil Gajrawala	analyst
Christopher Carey	analyst
Olivia Tong Cheang	analyst
Robert Ottenstein	analyst
Andrea Teixeira	analyst
Bryan Spillane	analyst
Korinne Wolfmeyer	analyst
Stephen Robert Powers	analyst
Mark Astrachan	analyst
Edward Lewis	analyst

Call transcript

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Operator

Good morning. Welcome to today's Colgate-Palmolive 2024 Third Quarter 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

Betsy. Thanks, welcome quarter and conference earnings our call. to morning, XXXX third release Good Faucher. is This John

XXXX results call conference differ Please third recent related these could forward-looking our and materially statements. release most quarter prepared the available from factors annual materials, to for a website, with Today's refer include statements. XXXX our XX-K that including Colgate's cause on from Form materially will the statements. and of on filings the press and to subsequent SEC, report SEC these could earnings actual filings, Actual differ results all discussion

This reconciliation in discussion release of Tables to Colgate's financial measures the call press in X non-GAAP identified X, also on website. X, earnings those and corresponding third press X GAAP including conference earnings include included quarter XXXX X, of and is will full financial the available A a is the measures, release.

call Chief our you it Wallace, thoughts Q&A. the and will for Noel provide our this with are and on then will we Financial outlook, Noel Noel? up Chief and results Officer; me Sutula, on Executive Joining Officer. morning and XXXX his President open Chairman, Stan

Noel Wallace

good as line quarter morning, thanks Thanks, John, another joining of us and and for we top again performance. line everyone, bottom strong report and

through to off strategy improved paying brand core more our higher volume-led and capabilities penetration impactful and growth. of is scaling drive delivering advertising health Our premium organic innovation, spending increasing household sales and strong,

with model in considered in markets whether as to in This It in better every as us deliver divisions and long-term we the our delivered growth our won't sales growth well time, quarter, growth X difficult will talking we've volume in every mix to pricing enable targets this business been comparisons. despite growth emerging deliver our for geopolitical and best breadth category or have factors recedes. about developed it's division represented quarter organic sustained, straight why from will other be decelerates in geographic You're and volatility growth line be fact the believe that's weather economic, X.X% markets. profitable we our growth category that seeing but and over growth second all with plans, building even X%

to commitment in lap paying Our we growth, profit more as our gross difficult comparisons. reestablishing margin off is even gross dollar

our And We which volume enabling this capabilities, used best-in-class organic into continue the margin ability P&L deliver to into us us strong in gives have turn deliver compounded gross is to built have TSR advertising per to term. we growth, the that expansion growth the consistent funding we to believe the sales growth. driving investment over flexibility earnings top-tier long organic sales share and growth

for questions. it up I'll that, with And open

Operator

[Operator Instructions] Mohsenian today The Morgan Stanley. first with Dara comes from question

Dara Mohsenian

I just row. for to significantly down the North second wanted a pricing into down in So drill was America. quarter NA

standpoint? And beyond? You the pricing volume us had and and strategy just in albeit as forward payback how a up about you look caveats? understand quarter, back that much how you're help us what take is muted from your to facing with quarter. But think we competitive just last a forward timing step environment warned set a going business you're result XXXX And getting, is that given the and some

question Can that cheating, North is to in you really mostly again, which with environment? a I light second Pet, your America but of Hill's to trends. volume isn't in sustainability on And Pet wanted industry striking the actually. performance pricing the But is share hopefully, relative this of slip about difficult difficult that given going talk and low the market single-digit forward industry environment performance, industry just pricing gains

Noel Wallace

Dara, you. thank

talked soft we which on where exactly a as in came I'll decelerates in we second expected moment. the but growth what But a volume more as normalization explain structurally, bit is as I and little fast we we're would little America, quarter. think about the on not category what or volume, Volumes a there's we the like, seeing in necessarily line. expected, returning, North So as more just less but

talked we We this the to quarter talked forward. about to into to expect the as was the continue year we'll a the due that see we orders. little benefit third being the moving and on first was more remarks, inch in as second some with it that which mentioned, adjustments we QX, a the mentioned similar the moves timing quarter, move with than a shipment volume balance through expect softer prepared bit of couple bit up promo expected. quarter. little of line Pricing fourth as as to in in quarter. I continue in was, of had we about This was it from We

back strong in what now the some overall, up obviously you've America, team China we reduction that have And didn't we've lower the more innovation place. setting health that we'll the growth as we volume quarter. or expected. principally obviously business we to -- of And is category obviously, The very of inch the ourselves for to through e-commerce impact seen the a a the less skin volumes, normalize strong driven as 'XX, in start plan with by come start noted to had really on focused due and see, a health that skin bit more. North But business little we've in

the North really overall, weather growth business. But broad-based the news is the across we've in with been to able strong good some of America softness

for coming in lower Hill's volume, of the exceptionally was Hill's was quarter. in Strong label. which impact performance strong. encouraging really It given strong a the private about talked You

a the up digits you strong up, the So margin performance and label private on really take we were on business. volume mid-single

category growth, with through came doing. bit again, we've quarter. got we in the brand, of and driving in pricing prices specialty the in pet into brand as move past, market. want that's the ad pet in gaining we're the articulated little been global of fastest-growing And in to is think exactly the that we've consistent the reinvest what And to the that take what margin we which continue we've share. A given brand stores. ] the ability to market neighborhood strength, some around We're [ We're pricing that

specifically about So continuing we we to are. feel that segments that We're into good competing where we in wet. aggressively business weren't expand below,

overall, is So good continue our behind to about strong, ability where advertising very business strong sustained the we Hill's drive and levels. to growth feel

Operator

with The Citi. next from question Filippo Falorni comes

Filippo Falorni

multiyear you give you guidance as going ability year. algorithm be to feel mentioned confident you're to today, not to perspective basis. in know in So ask you you about next wanted on but Noel, some initial I long-term start I your the a thinking

think volume about perspective from innovation about it areas markets, tough maybe on innovation, that you as the better -- comparisons, those and accelerate? cycling comps or are expect areas could what maybe how Pet of more the business that cycling Just contribution So in those accelerate? Is business you're could thinking the you of developed any business? food the

Noel Wallace

be drive we've capabilities Thanks, do now ability And flexibility to built of is the talking invest I the it that to to that that think, Filippo, into long-term think P&L. we how years the on sustained going for, question. for to really Yes. I growth. essential to are the We've important X attribute better in part been the that

that. That's now focused to invest on allows us gross margin brand we is strong built the So HX have we flexibility product what into way long-term the level, share and We've accelerating HX. health advertising That back we're a 'XX. drive to that do and P&L continue very and elevating into grid sustainable the improve business. We you behind particularly growth. will moving and right innovation, continued think new 'XX

That's the innovation really of couple sustained that the a particularly growth have continue seen the inflect last to have toothpaste that P&L. advertising toothbrushes, the seen you've move growth You've share reflection in the of in and growth sustained as and we years and global we the shares, over upwards.

the with brand of work those our the understand doing capita penetration Filippo, we getting growth lot through same, we're invest driving see analytical household we're the that behind real markets where where advocacy. continuing much per a building are, to where consumption better business, So opportunities, opportunities drive those back to in

'XX all So talking clearly play in about, out will been 'XX. into that and we've things the

Operator

next The from question comes Robert TD Cowen. Moskow with

Robert Moskow

a said ongoing basis. quarter, a I strong have about and in Obviously, Europe. results expect very on of as of your your this peers want been well. But Europe to an not to know lot delivering strong one peers

driving the And quarter? So do it? Europe in I you forward. going market to during expect know what's like What shares your wanted what were

Noel Wallace

pricing. clearly doing growth. really that put to Volume out an seeing quarter for Europe. sustained out we're My We're focusing Robert. a really the play pricing bit to investment we're fundamentals. on growth We've Again, terrific. which great into Thanks, line there was of back the job, of exceptional is Europe, not the Pricing, Yes. a significant gaining team in challenges Europe. which immune in top little congratulations

across level into very improved stronger we strong and good move categories news brand 'XX is much good shares, the with our But market health. penetration that's of a advertising

behind that those theme very reinvest talking we've So with about, growth consistent again, opportunities. been the

levels Oral at Care Our now. shares high record are

We targets. penetration very growth particularly building specific see continue to opportunities there, amongst

across back not the business, in. just in Care advertising levels Oral The were coming

always to very Advertising the we're is shares very high the have across some levels. growth good long immune and But softness in business that Gross at margins market the the But broad-based more inflected are seem is to seeing good news plague And we're the So European market European business. positively. strong. shape. term. very challenges of not

Operator

Herzog Sachs. Next question Bonnie comes from with Goldman

Bonnie Herzog

emerging basis. ask necessarily in offset wanted a but been sales strong most guess, as by Organic pressures. markets, translating I I And driven into to this has it's pricing growth of business. to markets significant on result, net a FX isn't growth your these been about

of curious understand ultimately, we about I be about think volume these businesses thinking to I'd So how contribution how going and, guess should the forward? you're mix better

Noel Wallace

very pricing Even in and Listen, Yes. emerging positive market positive Bonnie. Argentina, ex Argentina. were numbers volume Thanks, terrific. the ex

we're much So very encouraged so.

to very going well. opportunities, growth opportunities from. cap and very, be those continues particularly mean if Some of Mexico, our which look very per markets, And term we're long markets, premiumization where there perform strategically, to think in strongly. is Brazil, the I this larger we you come India executing is continue to

America, particularly they well exceptionally But Latin on elections. discussions emerging Mexico some some we've that place but into market continues of get have those continue in we'll deliver. we choppiness in despite some perform to of overall, seen to that the sure the post in strategy I'm markets,

you quarter, particularly board, Asia, the across go performance China. So strong this

Eurasia, quite again, strong. is through, exceptionally the volatility of India business going Our despite division some of Africa, Colgate China performed strong. well. that

into targeting the the penetration, basic So on fundamentals to the gross -- a we the we think opportunities, at driving P&L to has of back household business looking some more real some we're allowed premiumization flexibility the into refocus in markets. put sure lot us those that back of had making getting get margin on

Now the recent as over volatility well feel seen there's it, moving issues but rates earlier political and exchange to that not kind of But performance periods, some accordingly to underlying But and about of we're good immune the very some significant those see negatively outlined adjust that it. overall, we'd where you to economic emerging know, markets. the right that forward. like overall, have markets. to the we impact I move is in We've we'll of

Operator

comes The from Kevin next with question BNP. Grundy

Kevin Grundy

the margin long gross can thinking XX guidance the building mean us P&L? to development the so? you're hoping for blocks and results think good, cost strong maybe step company. the as strong time has help inflation, very contribution and lower level margin. Congratulations of year-to-date. quarter. Stan, the a with Great. relatedly, commensurately further that maybe with really next we over funding Without down We're pricing was what seeing about could year, be the next reinvestment months giving gross the I or Again, how thinking down just pivot about to start may quarter here you then And in on about quite continues to for been growth you're the

Stanley Sutula

thanks Kevin, question. the for

year-on-year very profit gross sequentially. in points the our it So with improved And quarter. expectations, and than pleased here we're basis third up candidly, was profit, better gross margin XXX

roll in As we've around here and on before, in even on year-on-year compares Also, to that raw inflation, tougher wrap forward. gross see saw we going continue we're margin material basis QX. a to you our disclosed

volume. openly, the about benefit teams us job and which we done think So have then as really growth get we also to think the funding the nice driving, looking components, on of drive And I the will from a margin. productivity, help

volumes a as about So when have we more ability always the variances. the overhead increasing, and benefit the to been think get absorption, we get that's

that contribution talked will we as mitigate the expect earlier, about time. Noel Now over pricing

I history, going not 'XX drive the if to we think we're you growth. look So funding here. see would But you give guidance that at our

gross great We have program the invest And through back which growth innovation, profitable growth, to that time. that balance drive help model margin, will funding to continue and dollars both management, top the us drive growth. here The be that line. combined that would that a business We'll productivity to through with expect, over in out we revenue advertising deliver bottom will P&L.

Operator

comes The Lauren next from Lieberman question Barclays. with

Lauren Lieberman

point whether it which reinvestment spoke So little about Like you was as flexibility. created could how a just Stan programs, productivity spending. go? beyond, on ongoing there to it's at the you just and a continues. you've talk if I return? growth curious of let's can sort rate about there's advertising Great. bit of diminishing 'XX high and philosophy but not funding the just call 'XX, this a Is

it's you diminishing? how about So coming do that ROI that and sure not it's and back still making spending with same think

Noel Wallace

equity term, you. about And how brand thank understand brands. that making are We've can and for Lauren, the flexibility products. that ultimately, product mean the And opportunities. penetration our that's company over sustained got obviously excited is growth We've strategy sure you got the our within quite we've opportunities. fundamental our building and health some consumers great we building Yes. I talked so time. benefits in using reinvest drive about is long

world find it growth if penetration at we measurements you But continuing volume whether and internal -- broad-based not. simplest benchmark ascertain particularly, to so through volume to line, working you us our us or important and most as the And have the the lot a assess see the drive of level, around is we ROI. advertising take for for is to

continue We move do How money, to seeing on -- the high is Are is for that. from basis. a getting we high? where another us better one to to need we're we returns division this on geographic returns? Are which assess we new

North particularly seeing return the on the Europe investments, put think Care. with benefit America business, I earlier. obviously exceptional more the I But overall, talked will about to We're investment into flexibility which from have our Oral now in We And we're some advertising to getting money forward. that. better analytics at at look moving better going we're and particularly using that's understanding ROI a to what's impact, working work as doing around really us we for of some have for us. AI improve our digital

intelligent decisions our as more understanding can a possible. very buys will so on we P&L. for media would that in for us really before, the into making than we've 'XX focus an capabilities a had even more really beefing we analytical the efficiency up much find and to much move That make us 'XX, and we primary as basis like on be we're fluid have advertising sure what's around I working is quickly as basis

with So business. good across our pleased support been overall, to able most through again, That of health. and drive innovations. overall premiumization some seeing the certainly brands more now penetration helping of We've investment. we're broadly And is our importantly, the we're good opportunities numbers advertising

as invest see long top about continue So and that. the penetration moving. line as to overall, going to good feel We're we we

Operator

from question comes next The Kaumil with Jefferies. Gajrawala

Kaumil Gajrawala

that follow little to bit. like I'd on up a

If could just good tactical of see it especially on, when would some made? some you helpful. you where you've advertising brand peers on because it what's tweaks detail you going when little longer-term there's talk a working. feels the a get Maybe in of changes think It the be a like the it's about struggled. the some we markets in I think that such of I Can said result, and into just better that more just on versus give building? being interesting maybe was could CPG you have more some things behind are at maybe that if lot

Noel Wallace

X in over a team entails in that amount sure or together that we see has strategy our growth is working Kaumil. Thank closely on York, time collectively heads, biggest we where what with here really our significant Sure spent X years, the you. Listen, the of the company. really operating last working are New And Yes. making of prioritizing opportunities. the

ensure more where able Historically, getting and presidents strategic democratic our aren't and to And the return We're I'd to bit our spending. money we divisions the say going across are for growth now we their where much get move pinpoint we're around were money we're areas to we're best divisions best afraid within the that see best ROI, putting in opportunities. where a the division to we in that.

all demonstrated that the growth through that And clearly is across X volume we're seeing divisions.

down this I performance comes Likewise, nice Bodywash quarter. Personal Health the had which innovation at Health, great Care businesses. both businesses, Skin Home Oral with not They're and classical America, but the in really result looking had and quarter. Pet Personal Care we're advertising. opportunities supporting to and across in only think it Home some in now great great Care just seeing Care the opportunities a Care a Latin relaunches some Europe in

strategically money in So it's that putting broad-based terms support sure we're and we're about geographic. very of where it's making thoughtful the

build we're but build focused brand frequency It's terms enamored and shiny on media out become of on of We're focused how to where we complex. platforms money. objects a selective is aspect are with health. from. to our and lot spend choose more spend the we to various get can how second far exactly The media environments we build that money. The that opportunities, of reach easy There accordingly in very there being

the here teams around really ROI out practices And world in paid that nicely helping digital and across area mediums, different up, the best York, to in digital has getting specifically us. share New the for

Operator

Carey comes The Chris Wells next with Fargo. question from

Christopher Carey

Can elections, a about positive. but in seeing America? comment you expand a the still remarks you're on You about a in and there Latin the made bit Mexico stabilizing comment and also prepared what was

specifically in connected perhaps think currency direction then do needing you Brazil? respond travel the were ways. that, ago? specifically to about about pricing some talked you So on Mexico over America, XX and any different you'd volatility the to what's And just year Latin just How of these in as this as a if markets they strategy Just the thoughts maybe in how strong market, not but are macros stable, months? approach and in

Noel Wallace

Sure, Chris. Thank you.

So really strong and volume tougher notably with growth, our line expectations. against we're again, mentioned, that's some comps. America, as in but in expect much We very did what slowdown performance sales in you Latin organic seeing,

America feel had good we underlying shares, market i.e., So terrific about the that. quarter. a very business, of Latin the And health specifically

Now at quarters. stack increased pleasingly, that if has you basis, business sequentially a X-year for volume look on consecutive X

So over there's pricing into fact in that the you'll the of those categories. volume seeing despite the geographies we're come significant took last back a that years. volatility, And we remember lot X

So sustained to as important. as see and did come is volume quickly back it

going Now innovation strong some a that in accordingly in of But watch that we've market. be got may elections, the particularly our that spending more and normalization. that post around make sure carefully plan. we're We're choppiness Mexico, category we've seen have thinking about to really to a

very which premiumization. You remarks, a significant business opportunity Latin America important continue a across to affords is we've us saw drive Colgate and Total, in to relaunched very the prepared

we've that excited Total very ever on But best Argentina. ex we pricing seeing that up is Colgate what Latin across are results that one put the formula America. of about behind But market and again, the the in think we

to of think move we to and markets, exchange So sluggishness we know. against us, the those that. offset behind brands well we that more the pricing that as you put strength can the continues and if take that some foreign of markets the we're But hits the support those foreign exchange not to in immune help business,

sluggishness to some what a of I is I And overall, performance again, to see. we the that think Barclays. we have talked across we carefully. continue quarter, very ended to need about strong as we're there. I seeing the based very on execute think, Mexico we well But at watch positioned team the the And that categories

the terrific continues little of So bit overall, about for region, feel plague uncertainty the good markets to of seeing Brazil, what some Brazil them, strong. performance that the quite a be in we're quarter coming but of Across rest good. a obviously those to continues out despite I -- Brazil.

knows that to and team premiumization. the continue to in knows to is volatile execute how how drive environments, penetration This

quarters. pricing, I foreign over pressures, aggressive pretty So inflationary despite we some the the the of while feel still get confident given pricing -- business that in will the lack exchange subsequent

Operator

comes Tong from with The next Raymond question Olivia James.

Olivia Tong Cheang

to or ask all the at backdrop. with and broader help affordability in are either think with thinking your consumers to have and the as that I plans taking about maintain, spend total basket that promotional to Just talk their North about thinking some in you're of product? this of if share sort you consumers about the mid-tier that price grow but that picture spending, not, particularly given And America, markets. you I actions respect to broadly environment, how wanted points you is scrutinize macro about can relevant to continue initiatives

Noel Wallace

Olivia. Thanks, Yes.

me So back come to let again, strategy.

our have that has share growth. to benefits the on been with to accelerate the that premium world, value-add ultimately, core brand particularly supporting advertising penetration side around the the providing of and the Our big business, we getting and, strategy innovation, businesses

the We Our quarter Likewise, across obviously, volume saw, performed in shares. toothpaste shares general in value in well quite performed that the our regard. world. well

North America, innovation multiple in our dial that making added again, compete. continue overall, which challenged, little consumer it's tiers be -- up across price may provide in and we a bit for the real we So to the sure particularly value

cadence sure promotions, pack and price your strategy, aspect that is making how on-pack about digital are promotions, paper other your your strategy, your you your that architectures. very The of coupon you promotional coupon thoughtfully promote thinking

determine in to going making sure are and have performance to drive we what's retailers category growth those for of really that analytics continue business. drive our critically the our to important All for

the reviewing work AI our the was I and of retailers the with that great results doing and day with U.S. seeing some we're other for analytics just some around incredible in that. real promotions

the environment yes, little competitive. less the line, Still Coupon bit rates I more up. which more which or is back to is, is point would So but to not a normalized. pre-COVID normalized. redemption Promotions good, the are in seem levels, think I say, be more or less

sure world, ultimately, best coupons. would we it's But as COVID. across And our normalized rates in money we higher the the making behind possibly that thoughtfully to post redemption we're can where say as of consistent terms promotional get consumer, were I more But it's ROI. spending pretty a slightly

Operator

from Ottenstein question comes next Evercore ISI. Robert with The

Robert Ottenstein

Great. Terrific results, Noel.

so that, just places? a spending stand I you So -- the well more you, X so guys that's data, the it And questions, you're it the is answer. of or kind in are and you're doing think it's right places. I back broad sort why at you many you've is more the I got money, in very think, of hey, listen so underlying question least X and spending can spend And to if the think of --

is on specialties? that a by driven -- about other whitening bit talk How that is But and drill by what little more point then just or and your the much I'd technology, to maybe see do success marketing Oral initiatives of and down like Care.

know at if how little gains model the you're And of time, money point much sense that tough market to that -- give spending can we more doing things you a to but a just else to anybody get that going just this sustainable, I talk I looking just which more to what go than applies trying beyond want very bit that that that's you're at in just about also, market? then And had Just and the is chance more. China, being successful in marketing. share drive continued on,

Noel Wallace

thanks Rob, the question. Great. for

dial because think, where in emphasize long-term, with back, the around to comes building about I don't talking want the and necessarily performance lot impact of of immediate just business. we categories the in to it a We've opportunities. focused really all health our see those capabilities but time that you on intended capabilities. really on again, behind So see consistency growth our spent ability I building world our quarter the sustainable are in And

It's It's our return be. it's core innovation. it's behaviors. our our making accordingly. and innovation addressing we're So that data talking needs is that about making is and decision-making. where be, to on investment. the using sure it sure to drive across to the making acquisition It's data HX better advertising, where needs digital, that It's it sure channel Making sure invest But new then that all and basics we've been HX we

to do had we And the that. addressed to get the P&L middle of

X to and invest a get continue And then lot they health, health consistently years really measure really our get to where the want they brand equities, internally took us So and what allowing a our good pricing of is paid that place, we out last behind our brands. categories ultimately, And of to the build. to needed over we are we to our to. deliberately that's in in

immune to is not we're what Now about. everyone talking

business. thoughtful we that certain home think not deliberate, some those opportunities do we going build sports there. analogy. take there's business move continue most, real We're -- footprint geographies these we approach take and broad-based where growth necessarily Clearly, again, forward. geographic But be can't to sharpen our we're need the step going the us to see it's see consistent. but of for to making growth to in allows a lot our breadth we some going that and address time. that volatility to weather We're believe of to to divisions the you're a back we and to drives us and capabilities referring a that. as We a complacent. over to do singles better But try to But we in want be we We to that seeing need to runs, to way more sure continue hit of than this

a again, now Rob, that think whitening the we premiumization, adjacencies, the core. significant Colgate innovation strategy, some on new of the have in Total question, brought your new on Oral focus we we America To the with Care. So product behind innovations on particularly lot rolling out Latin great

markets, heard that the we're India roll out. great bringing of across Asia continue of into some and will the some You to Max technology about Fresh Southeast that

stepped-up ultimately putting behind that and that will again, out. innovation the So resources we're play

some perform China high should continues single our brand good pricing The said, the referred investment very the Hazel some Hawley that to pretty & and specifically, I'll continues calendar premiumization, business by driven Colgate really, be had first easy business on digits, Colgate But being improving that do the primarily we the said moving health mix then to. to business. tougher really against a up our well, And talk it behind I comps getting to On China well. of we're comps. innovation overall, and We're side. Colgate forward. across of great that volume

need good, starting of quarters know, which Hazel, as you come has Hawley of is challenged yet. a to that not see where few come but we be We're to nicely, quite out & growth. back

have still for we room So opportunity.

we sustained market Hazel our volume very & moving want Hawley to value team next invest to at the and we structured drive be years in that competitive growth looking couple and approach That are ensure really We how a about for business. is the deliberately continue go-to-market thinking forward. can of to on over

and across with But will immune we're pleased that moving slowdown business drive the performance supporting growth that China our not the forward. business. to performance, behind the but think consistent But we we're sustained seeing those innovation overall,

Operator

JPMorgan. question from with Andrea comes Teixeira next The

Andrea Teixeira

the was your QX? range. Because question the it Noel, a supposed it's is seems what quarter? X% growth organic exit on even rate tone in the pace My wide in guidance from globally. you're sales And embedded for to for your call, if of this that the keep raised, guidance what is And

now around Can is be trends on more potential into in the you continue, So on And would the the that that words, can the should clarification comment Hill’s. embedded if range that of other more squeeze XXXX? thinking, a with for current be top capacity X%? I expansion if you we international way

Noel Wallace

I we specifics. in. I Listen, think pretty Great. feel we're quarter by of we quarter, get to -- want guide do where good health you. the the into the Andrea, about thank so don't don't came underlying But

a as So talked issues But comments, our we many I positioned as season. But that's think that I the again, for companies some growth. have reflected in mentioned, immune you guidance. we're in earning my the about the CPG And upfront throughout overall, of consistent think to good. And we're said not, as of speaks for we're I see where that in we're think little the unfold ultimately overall, and like numbers feel seen slowdown, in exit terms guidance little exchange. in position. we year. Obviously, the be. itself categories a see We'll the good we in of pretty we've we'll a we our where foreign move But

middle things the of flex On the It's continuing Hill's lot business. is good capacity, more the that obviously of us to P&L. in build allow Hill's a on allowing to

and those chain supply factories. that optimize truly to ways find build to to positive variances continue more We

wet it's into in Secondly, in growth wet the share obviously a the we in continuing overall that the quarter us expand nice which business to segment, segment. growth and in saw to higher drive allowing segments

us flexibility. giving it's more a So lot

quarter a facilities network. supply be exceptional But job, the addressing continue allocating Hill's see, team at to of really an very particularly optimize and ways to internationally. about doing we think we volumes obviously integrating There's done. to growth the the that across just be finding chain opportunities how is new work and terrific the world diligent We'll overall, more some about very, and the

Operator

Bank comes of with The next Bryan America. question Spillane

Bryan Spillane

could dollar I more profit dollar or and So gross question. you've just bit about you you're a the focus signal to and a Just profit dollars if clarification And growth. there you clarify of maybe clarifying, bit sort in And a whether I versus margin gross send earlier lead here on maybe trying growth question think a gross still that that? I think that message past, shifting to a is gross of we percentages. there's that sort talked of the any I had of so know margin then -- profit view expansion? little Noel, about a maybe And the gross one just it's point created have little

Noel Wallace

Yes.

importance Encouragingly, important in on as impacts we I at we margin look it and exactly margin both it's through be. Bryan. me innovation, strategically again, Stan, whether will opportunities, -- that's been how gross to gross both saw the But quarter, thoughtfully we could as us. percent Let for the growth throw the geographically, margin, margin the we're and quite think No gross message -- We of whatsoever maybe dollars. here. understand We gross we've consistent. thinking

dollars Stan. ultimately, looking ability And gross to going continue drive in volume hard to is very can be choice. our is to it's But what has just without not gross let a percent. bit chase the we're give dollars drive to deliberate me But to color. to to there We're invest little He saying. margin more business. provide It what it get to margin for I'm

Stanley Sutula

Yes, Bryan.

Hill's. the a -- obviously And as point in those to of that we're all, we think going part saw look, in margin the a business, is trying make X. improvement you first of combination -- So margin to is we you number deliver particularly growth if improvement And dollar businesses, it we trying about is to in of that -- in great how have the shift. a only we're

the growth. But a business into continue going a drive it's and business overall of at dollars investment we at back and And here benefit, and part margin look So both. that is bottom has on pricing help how of as both model deliver combination will will we our line the top be look less been a productivity and be driver volume in that. as obviously, we of a to

John Faucher

growth growth at is dollars, Bryan, one that's the if can Stan's TSR bottom I piece in EPS what group. We point. [indiscernible], right, peer to end just long-term right? point add creates our line need because of The top

organic we we TSR. drive to driving those about So growth, growth sales talk to dollars but EPS percentage, dollar-based we're drive gross growth. margin We sales profit driving focused also drive know need on talked but we gross about in dollars to

So as to a both it, said, need drive but to thoughtful Stan look bottom growth. it's way that very at line you

Operator

The Korinne Piper comes Sandler. next with from question Wolfmeyer

Korinne Wolfmeyer

QX pullback clarity clarify in the quarter. shipments dynamics North the as back be orders? to? just bit about retailers of like should what in are of to due pulling then e-commerce, the I'd in the mean America And inventory the dynamics what the And were pushed we like macro about on get U.S. then I you in thinking in that some talking QX. QX, that was some were some that Can was from how more on especially attributable to? a it to little going sounds some

Noel Wallace

the you. getting there network Yes, from specific fourth that ultimately shipment moved some systemic we disruptions would our was Again, things. due into to that be just some order feel time. move X talked third Karen, But we the out in thank fourth ultimately, reoccurring. timing and about quarter, to Obviously, But that there's that quarter. nothing it in will

more in -- was we inventory we or those U.S. going issue seen moving China. anything. on to bit business. where specifically on the Asia, softness think more big e-commerce specific skin retailers one health to online were than that's any carefully pull We've our The be end obviously, see the if of was orders at quarter. the watch case, out specifically But of that back sustained not and saw a adjustments of But the some need a little forward. to We some little market, coming there's this

America, the dynamics would more macro say, I overall, stabilization. And the in North

seen haven't deeply on anything side. promotion unusual the We

on back not is was, consistent. think where or was, it the percent promotion high more to as pre-COVID. less Still I as pretty sold it

did of higher coming would overall in terms But now. depth through pretty redemption what proportion seems on in the and mention, normalized couponing, say So bit overall, I normalization, and rates as seen activity promotions. past right little more broad-based to number we've little a more I a of the

Operator

The next Powers question Bank. with Steve Deutsche comes from

Stephen Robert Powers

to Skin care Care with you're what approach on [indiscernible] wanted assuming do expand respect about Skin that carried good to longer of opportunities key able was and you could there's them it, But first, how structure seeing give that North Noel to in skin guess, a in the trends ask health And skin because reporting segment changes you've deal some more a that to or Care. maybe markets how strategy the with I little generally, in of the drag this made bit I then but across on it year to I variability. just mechanically of quarter any in I'm you extent term? a talked growth you was? you've much quantify this up restatement on America, guess, following are

Noel Wallace

Steve. Thanks, Yes.

But in extent the as quarter. others, specifics specifically skin, generalize. particularly quantify not some just if you've skin was, sluggishness, been and flat out around me with on let from the But skin overall, take in a that. any the sector, Likewise to America changes So the to I U.S. you going North I'm closer think for certain more to in order there's was Europe, heard and the well. Asia.

necessarily to not we're So immune that.

We're very we very good that clean U.S. about on some here about about more years' compete much to But had are the in business. in compete deliberate opportunities to outside making we that business where the choices invest have market were order drive and is that L'Oréal. very we being the sustainable XX organization centralized how differently. for in thinking where experience somebody with to at We what now decisions and feel talent, and to We specifically very global from we of invest. didn't clear getting in doing expansion there center think we and -- we we we space. over some want that articulate how what been quite brought We want up the

European back see of issues Asia health some and again, obviously, the address. long-term that very favorable. we're we're But obviously, business place some aspects overall, in the that But strategy. we of to got we of markets with, encouraged, be in and we're short-term by We've the continue to growing putting softness economics the the the that where long-term overall, some to strategy expect. us sustained get seeing will growth feel we And

Operator

Stifel. Next question comes from with Mark Astrachan

Mark Astrachan

question to there. of of U.S. a Care dive more deep I back wanted ask and to Oral kind go

period back it's to decelerating time. period or is long time, of what outperformance? a were back or in going has the loss? of was been contributed a over What it trends market where to quite growth, this loss of X the guess 'XX 'XX. situation But at has look contributed long there to question to share X share quarters to that I state back we a as largely, So

and share Where And if are what from And a better could maybe do you how a you a there's thought around remains trajectory a on just refocus competitors of of relaunch whitening, broadly you share? doing think well, general the deep think dive gaining where to this know lot on kind is. of had about from think perspective? innovation you it Colgate they're job where like yet, kind do total do Because I it?

Noel Wallace

good last down points couple Yes. that Thanks, we've roughly channels. basis clearly, on of channels are toothbrushes. our impact over some on untracked Mark. performance overall, refocus of Listen, we've seen in toothpaste up on flat, years And those XX and shares some untracked the seeing of had the and

the to strategy of overall, business side innovation of got we're We've that right the is strong It's where premiumization getting up. trading So focused we're the We've that now, and good. a get some more seeing into on businesses consumers mid-tier. benefited business see you addressed. very certain as the consumer not core the got dialed want exactly extent, it we to

side the forward. continues focused very of well. business business overall, that getting premiumization in we're very on to the strategy. But very, the And moving Toothbrush it's addressed perform

for necessary. forward. up relaunches into were 'XX So that privy getting we that all are again, about, and the to the set in innovation success have the right, core of investment we fundamentals not market, plans think shelf sets, putting we talk that big the basics think that distribution the stronger we're executing were more moving some around And

where some, choppiness drive has retail the struggled with shares, of again, higher and their had turn environments, to retail environment. seen we We've of traffic particularly drug trade, some the class in

to shift opportunity for long retail But short a sluggishness in channel growth having the we but term some environment in you've drug provides us, the term. we're So seen accordingly. still that feel

Operator

question last with Redburn today Our Atlantic. Edward Lewis comes from

Edward Lewis

you back looking just your launched guess years I a few when ago. strategy new Yes. sort of

about the You a core around lot talked CPG of that. product doing

the there. you I now And about we've looking helping Asia, of much mix years changed relative China is like, and of that with how say, America strategy? channels, regions And categories. much in adjacent also talked the a e-commerce seen seeing ex about success it how you're in But channel the to the at the China. talked for success mean, today, where on results adjacent was the Latin number opportunities before? And with just You premiumization

Noel Wallace

I club the in quite you. around focus question. the the that formats years. format China, discount couple a on and in in more expansion world. club stores store The expansion of in the identified Yes, unique parts Asia, grow of specifically, Ed, the thank Interesting world, of was expansion. channel on particularly opportunities initial seeing mean certain innovative back significantly we predominantly real of the It's you're e-commerce, very but

sure innovative successes invest, products around the in we decades working very that we to strong Stores that the we're North going that's long-term are want our when initially in strategically growth formats. But as we ultimately, it's business. their been for retailers, making there. And retailers for share here and we've And sure bring Dollar think to new America got we've of with had quick our to guided we to that of sectors. one ago those retailers So all to where investing drive growth to we've drive are been to it's adopt making the

channels. And we're key new come thoughtfully whole we category how as for the across on that way very category that drives for focus that all stream, market. growth in see retailers a environments making sure thinking And to for retail the growth on and the for that's do our that us,

to attuned So what I the think it's just being markets. in very we're seeing

level. retailer lot innovative seeing of a things happening the You're very at

expected some to I in the the think challenges be that's move e-commerce. of to given

drive working experience. tandem the having configurations products big need to architectures the excitement them need, we they order in their shopping have that box shelf. ensure they very and much And that with that in to there's change the to we're So pack retailers are at price

Operator

Q&A the portion. [indiscernible]

Noel Wallace

importantly, a and work year-to-date sheet. well. quarter. again, around that a were X.X%, up very at to quarters. executing between sales the basis. far world across strategy income at so up good X.X%, balance growth EPS is pricing everyone. of a a Net organic, all Colgate We're and aligned the on having digit statement Thanks, But and our X.X%, volume strong extraordinarily hard getting double year X.X% this people And with flexibility and the the Again, balance X through strong

all So for for a strong questions the everyone, the and people today, thanks delivering quarter. to Colgate thanks,

Operator

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

disconnect. now may You

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