Colgate 7.5% Q2 North American Sales Gain Fueled By New Products
This article was originally published in The Rose Sheet
Executive Summary
Colgate's North American sales increased 7.5% in the second quarter, spurred by new product introductions, including Simply White and Simply White Night tooth whiteners and Colgate Total Plus Whitening and Colgate Herbal White toothpastes, the company announced July 22
|
Colgate's North American sales increased 7.5% in the second quarter, spurred by new product introductions, including Simply White and Simply White Night tooth whiteners and Colgate Total Plus Whitening and Colgate Herbal White toothpastes, the company announced July 22. Colgate's liquid hand soap business benefited from new products like Soft Soap Naturals Milk & Honey, Soft Soap Foam Works and Soft Soap Aromatherapy, the company added. The momentum is expected to continue in the second half, VP-Investor Relations Bina Thompson stated during a Q2 sales and earnings call. "So far this year, we've launched 11 new products, and we expect to launch another 11 during the balance of the year," she said, cautioning the second half will face a difficult comparison with the year-ago period, when Simply White debuted. Among the new products rolling out now is Colgate Total Advanced Fresh toothpaste, which claims to provide 12-hour protection from bad breath (1 (Also see "Total Advanced Fresh Launch, Record Q1 Have Colgate Breathing Easy" - HBW Insight, 21 Apr, 2003.), p. 5). North American unit volume increased 7.5% in the second quarter with U.S. volume up 9%, Colgate said. Operating profit in the region increased 14%. Simply White is on track to generate $100 mil. in the U.S. this year and will benefit from international distribution as well, CEO Reuben Mark stated. However, the whitening category remains a "relatively small" piece of Colgate's business. The exec retracted earlier statements predicting Simply White would generate $250 mil. "We will not have $250 mil. in Simply White for the year, and I don't think we ever thought we would," Mark conceded. The category "still offers enormous opportunities for growth," Thompson said, explaining that while the category is growing at about 80%, penetration is still low at around 10%. Colgate's consolidated sales in the quarter increased 7% to $2.46 bil., and net income increased 10% to $359.8 mil., marking Colgate's 29th consecutive quarter of increased net income and earnings per share, according to the company. |