Colgate-Palmolive Company (CL) Q1 2022 Earnings Call Transcript

For the period ending March 31, 2022

April 29, 2022 8:30 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good day and welcome to today’s Colgate-Palmolive Company First Quarter 2022 Earnings Conference Call. This call is being recorded and is being simulcast live at www.colgatepalmolive.com. Now for opening remarks, I would like to turn the call over to Chief Investor Relations Officer, John Faucher. Please go ahead, John.

John Faucher - Chief IR Officer

Thanks, Cristina. Good morning and welcome to our 2022 first quarter earnings release conference call. This is John Faucher. Today’s conference call will include forward-looking statements. Actual results could differ materially from these statements. Please refer to the earnings press release and our most recent filings with the SEC, including our 2021 Annual Report on Form 10-K and subsequent SEC filings, all available on Colgate’s website, for a discussion of the factors that could cause actual results to differ materially from these statements. This conference call will also include a discussion of non-GAAP financial measures including those identified in Tables 5 and 6 of the earnings press release. A full reconciliation to the corresponding GAAP financial measures is included in the earnings press release and is available on Colgate’s website.

Joining me on the call this morning are Noel Wallace, Chairman, President and Chief Executive Officer; and Stan Sutula, Chief Financial Officer. Noel will provide you with his thoughts on our Q1 results and our 2022 outlook. We will then open it up for Q&A. Noel?

Noel Wallace - Chairman, President and CEO

Thanks, John and good morning to all of you. Given the release of the prepared commentary earlier this morning, I will keep my remarks fairly short as I am certain you have a number of questions.

Obviously, 2022 is shaping up as a more difficult year than we anticipated with greater-than-expected increases in raw materials as you have seen from others, particularly fats and oils and logistics. This is offsetting what we think will be a very solid year for organic sales growth now that we are seeing our global supply chain stabilize following COVID-related lockdowns and stress in logistic networks around the world [Technical Difficulty] sales growth for the balance of the year.

First off, we knew that Q1 will be the most difficult quarter given comparisons, supply chain issues and pricing negotiations. We exited the quarter with high single-digit pricing as we took more pricing in developed markets starting in February and continuing into April. We believe this is more indicative of the pricing we will see for the balance of the year. Elasticity seemed to be either in line or better than expectations and this should help limit incremental volume weakness from the higher pricing over the balance of the year. Encouragingly, as we said in our prepared remarks, volume and organic sales performance improved in February and March versus January and organic sales growth has continued to accelerate in April.