How did you see the Colgate Palmolive results for Q3?

Cost pressure has not become the norm for FMCG companies as raw material costs and other inputs like coal and power have become costlier. Colgate managed it with better tweaking of costs in the quarter. For instance, to combat the spike in input cost, inventory cost and manpower cost, Colgate reduced advertising and publicity spend in the quarter. This helped Colgate hold margins. First a summary of the numbers of Colgate.

Let me begin with the top line numbers of Colgate. It reported 3.91% yoy growth in total sales for Dec-21 quarter at Rs.1,280.12 crore. Momentum was weak with sequential revenues lower by -5.35%. There was a stable top line performance in its core personal care and oral care verticals. Among its new product launches, included Palmolive face cream brand which marked its entry into the Indian markets.

The operating profits were up 3.56% at Rs.336.63 crore on a consolidated basis compared to the Dec-20 quarter. Needless to say, there was a spike in cost of raw materials, inventory costs and employee benefits in the latest quarter which added to the cost pool of the company. However, Colgate has managed to strategically offset these higher costs by reducing the advertising and publicity cost by nearly one-fourth in the quarter.

Finally, let me turn to the bottom line. Net Profit for the Dec-21 quarter was up 1.60% (you can almost call it flat) at Rs.252.33 crore. However, this happened in a rather difficult year. Innovation and product launches helped as Colgate launched Colgate Gum Expert with Curcumin extracts in the quarter to expand its portfolio offering, apart from Palmolive face cream. PAT margins fell from 20.16% in the Dec-20 quarter to 19.71% in the Dec-21 quarter.