Colgate-Palmolive: cautious tone after 'challenging' quarter

(CercleFinance.com) - US consumer group Colgate-Palmolive said on Friday that it expects a lower gross margin and earnings growth in 2018 than in 2017, which dragged its shares down 5 percent in pre-market trading.


The toothpaste maker said it earned 523 million dollars, or 0.60 dollar per share, during a "challenging" third quarter, down from 607 million dollars, or 0.68 dollar per share, a year earlier.

The result included 22 million dollars of charges related to the company's efficiency program and 80 million dollars of further charges related to the US tax reform, Colgate said.

Its gross profit margin fell to 59%, versus 60% in the third quarter of 2017, while net sales decreased by 3% to 3.85 billion dollars.

Organic sales - which strip out the impact of foreign exchange, acquisitions and divestments - were down 0.5 percent, due to market volatility in Brazil and trade inventory reductions in China.

Looking ahead, Colgate-Palmolive - which sees "uncertainty" in its markets - said it expects a lower gross margin in 2018 and double-digit EPS growth versus 2017.

Its shares were down 5.3% in pre-market trading.

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