Colgate-Palmolive announced big gains in its like-for-like sales worldwide for the fourth quarter that was negated by a significant hit from foreign currency exchange.
The company said that Q4 net sales were $4.36bn, which represented an increase of 2.0% compared with 2012. However, with sales volumes growing by 6.5%, organic sales grew by 6.5%, a figure that was ultimately negated by a negative impact from foreign currency exchange of 4.5%.
Net income for the quarter came in at $564m, compared to $598m for the corresponding period in 2012, a figure that was primarily hit by tax charges of around $73m.
Full year profits hit by restructuring
For the full year results, sales were up by 2.0% to $17.42bn, compared to $17.01bn, while net income was slightly down, at $2.24bn, compared to $2.47bn in the corresponding period last year.
The company pointed out that the decrease in its net income for the full year was mainly attributable to additional caused arising from its 2012 Restructuring Program.
"The strong 6.5% organic sales growth was led by the emerging markets, where organic sales grew a robust 10.5%. Our strong top-line momentum should continue into 2014, fueled by new products across all categories and in all geographies,” said Ian Cook, Colgate-Palmolive chairman, president and CEO.
Latin American sales impacted by currency exchange rates
On a regional basis, sales in North America were up by 2.5% to $772m for the quarter, driven by the success of Colgate Optic White and Colgate Optic White Dual Action toothpastes on the oral care side.
Sales in Latin America rose by 0.5% to $1.26bn, representing a 10.5% increase in volume that was negated by an 11.5% impact from foreign currency exchange. The company reported that sales were strong in most of its Latin American markets, driven by brands such as Colgate Luminous white on the oral care side, together with Protex Men and various Palmolive soap brands.
Sales in Europe/South Pacific were down by 0.5% to $844m, driven by brands such as Colgate Max, Sanex and Palmoilve shower gels, while sales in Asia were up 4.5% to $572m and sales in Africa/Eurasia were more or less steady at $325m.
Company looks to high profit growth in 2014
"As we look ahead to 2014, based on the Company's current growth momentum and our confidence in the strength of our global growth and efficiency program, we are planning for a year of gross margin expansion and strong earnings per share growth in line with the consensus of external analyst estimates, excluding charges related to the 2012 Restructuring Program,” Cook said.
“This takes into account recent movements in foreign exchange rates but excludes the impact of the recent economic announcements inVenezuela, which we are still evaluating."