Colgate 2nd Qtr 2008 Earnings Beats The Street

Colgate Announces Strong 2nd Quarter - Excellent Worldwide Sales and Volume Growth - Sales, Unit Volume and Operating Profit Up in All Divisions

New York, New York, July 29, 2008… Colgate-Palmolive Company (NYSE:CL) today announced excellent worldwide sales and unit volume growth together with higher than expected earnings growth for second quarter 2008. Worldwide sales grew 16.5% to $3,964.8 million and unit volume grew 5.0%. Global pricing increased 4.5% and foreign exchange added 7.0%. The very strong top-line growth was supported by an 18% increase in worldwide advertising spending to an all-time record level.
Second quarter 2008 results include $29.5 million of aftertax charges related to the 2004 Restructuring Program. The year ago quarter included aftertax restructuring charges of $41.7 million.
Gross profit margin as reported was 56.5% in second quarter 2008 and 56.0% in the year ago period. Excluding restructuring charges, gross profit margin decreased 30 basis points from 57.1% to 56.8%, reflecting increases in raw and packaging material costs worldwide, especially oil-related costs and agricultural commodities. These sharp increases were substantially offset by increased pricing and successful savings initiatives.
Operating profit as reported increased 17% versus second quarter 2007 to $767.0 million. Excluding restructuring charges, operating profit rose 13% to an all-time record $805.9 million.
Reported net income and diluted earnings per share in second quarter 2008 were $493.8 million and $.92, respectively. Reported net income and diluted earnings per share in second quarter 2007 were $415.8 million and $.76, respectively. Excluding restructuring charges, net income increased 14% in second quarter 2008 to a record $523.3 million and diluted earnings per share increased 17% to $.98, also a record. In second quarter 2007, net income and diluted earnings per share excluding restructuring charges were $457.5 million and $.84, respectively.
Net cash provided by operations year to date increased by 14% to $1,028.9 million. Working capital increased slightly to 3.5% of sales versus 3.3% in the comparable 2007 period, and net debt (debt less cash and marketable securities) declined versus second quarter 2007.