Last week, Colgate-Palmolive tallied up net sales of €3.61bn ($4.34bn) for Q1 of 2021, up 6% on the previous year, and total net income for the quarter sat at €567m ($681m). Within this, organic sales rose in oral care, home care and pet nutrition but declined in personal care.
Regionally, Asia Pacific reported most growth for the quarter, with net sales surging 16.5% led by organic sales growth in Greater China, India, the Philippines and Thailand. This growth was followed by a net sales rise of 8.5% in the Africa/Eurasia region; 6% in Europe; 2% in Latin America but a dip in net sales of -0.5% in North America.
Noel Wallace, chairman, president and CEO of Colgate-Palmolive, said: “Our growth momentum continued in the first quarter.”
“…The strong results reflect the impact of our increased investments in premium innovation, digital transformation and advertising. We continue to strengthen our capabilities in these areas and, while there is more to do, we are pleased with the progress we are making,” Wallace said.
Future growth? Still ‘a lot to do’ in the coming year
Discussing company guidance, John Faucher, chief investor relations officer, said Colgate-Palmolive still expected organic sales to grow within 3-5% over the coming year, but the company was now “probably a little more cautious on developed markets”.
Wallace told investors on the Q1 earnings call that whilst the company had “made progress” in the quarter, it still had “a lot to do in the balance of the year”.
The CEO said the key priority remained driving “broad-based growth” in 2021 by the continued ramp up of “breakthrough and transformational premium innovation” – a strategy outlined at this year’s CAGNY conference by Colgate-Palmolive’s chief technology officer Pat Verduin PhD.
“…As Pat and I discussed at CAGNY, this is a marathon not a sprint, but we’re making good progress which will continue as we shift our resources, continue to build new skills and even adapt how we motivate our teams. Pricing is also an important element of growth, and behind our revenue management efforts, we continue to drive strong pricing as we look to increase our price index versus the market, as well as offsetting rising costs,” Wallace said.
Raw material headwinds won’t abate anytime soon
The cost of raw materials, warehousing and logistics had risen sharply this quarter, he said, and so Colgate-Palmolive had to remain focused on “battling the cost inflation across the board” via smart pricing and investment in efficiency initiatives.
“We do not expect these headwinds to abate any time soon, so we have to continue to invest in marketing and building capabilities for future growth, while delivering on our earnings guidance. We know we need to be disciplined and efficient in this area.”
“…We are building a team and culture at Colgate that is focused on adapting and changing to this volatile world. We’re embracing new strategies and new ways of working, and it’s paying off. We’ve had a good start to 2021 and we’re looking to maintain our momentum through the rest of the year,” Wallace said.