2019 Annual Report Annual Report
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Colgate-Palmolive ACCELERATING GROWTH Colgate-Palmolive Company n 2019 Annual Report Company 2019 Annual Report 300 Park Park Avenue Avenue New New York, York, NY NY10022-7499 10022-7499 Colgate-Palmolive is a leading global consumer products company, focused on Oral Care, Personal Care, Home Care and Pet Nutrition. With more than 34,000 people and its products sold in over 200 countries and territories, Colgate is known for household names such as Colgate, Palmolive, elmex, meridol, Tom’s of Maine, Hello, Sorriso, Speed Stick, Lady Speed Stick, Softsoap, Irish Spring, Protex, Sanex, Filorga, EltaMD, PCA Skin, Ajax, Axion, Fabuloso, Soupline and Suavitel, as well as Hill’s Science Diet and Hill’s Prescription Diet. The Company is also recognized for its leadership and innovation in promoting environmental sustainability and community wellbeing, including its achievements in saving water, reducing waste, promoting recyclability and improving the oral health of children through its Bright Smiles, Bright Futures program, which has reached more than one billion children since 1991. For more information about Colgate’s global business and how the Company is building a future to smile about, visit http://www.colgatepalmolive.com. 38084.COVER.CC2020.indd 1 2/20/203/16/20 3:518:55 PMAM 2019 AT A GLANCE SHAREHOLDER INFORMATION Corporate Office Independent Registered Reports and Policies Net Sales By Colgate-Palmolive Company Public Accounting Firm Annual reports, press releases, NetGeographic Sales By Region 300 Park Avenue PricewaterhouseCoopers LLP company brochures, SEC filings and Geographic Region New York, NY 10022-7499 other publications are available on our 22% North America #1 $15.7B (212) 310-2000 Communications to the website at www.colgatepalmolive.com. 22%23% NorthLatin AmericaAmerica Market Share Worldwide Board of Directors Also available on our website is our most Stock Exchange Colgate shareholders and other recent Sustainability information and 23%16% EuropeLatin America In Toothpaste Net Sales The common stock of Colgate- interested parties are encouraged Colgate’s policies on Diversity of Colgate 17% Asia Pacific Worldwide 16% Europe Palmolive Company is listed to communicate directly with the People, Code of Conduct, Ingredient 17% 6% Africa/EurasiaAsia Pacific and traded on the New York Company’s independent directors as a Safety, No Deforestation, Environmental, 16% 6% Africa/EurasiaHill’s Pet Nutrition Stock Exchange under the group, individual independent directors Occupational Health & Safety and symbol CL. and committee chairs by sending an Product Safety Research. For information 16% Hill’s Pet Nutrition email to [email protected] or by about our products and our Programs Transfer Agent and Registrar writing to Directors, c/o Office of the and Policies on Animal Research and 57 $3.1B Our transfer agent, Computershare, Chief Legal Officer, Colgate-Palmolive Development of Alternatives, please call Consecutive can assist you with a variety of Company, 300 Park Avenue, 11th Floor, 1-800-468-6502. Operating Years Of shareholder services including change New York, NY 10022. Such communica- Cash Flow of address, stock transfers, questions tions are handled in accordance with the Investor Relations Dividend Increases about dividend checks, direct deposit procedures described in the Governance 1-855-322-3551 or (212) 310-2575 of dividends and Colgate’s Direct Stock section of the Company’s website at Email: Net Sales By Purchase Plan. www.colgatepalmolive.com. [email protected] NetMarket Sales Maturity By Direct Stock Purchase Plan SEC and NYSE Certifications Institutional Investors: 52%Market Developed Maturity Markets A Direct Stock Purchase Plan is The certifications of Colgate’s Chief Call John Faucher at (212) 310-3653 $2.8B #1 available through Computershare, Executive Officer and Chief Financial 52%48% DevelopedEmerging Markets Markets Cash Returned Company In our transfer agent. The Plan includes Officer, required under Section 302 of Consumer Affairs 48% Emerging Markets To Shareholders Household Products dividend reinvestment options, offers the Sarbanes-Oxley Act of 2002, have For Oral, Personal and Home Care 1-800-468-6502 Through Dividends And Industry By Dow Jones optional cash investments by check or been filed as exhibits to Colgate’s Annual Share Repurchases Sustainability Indices automatic monthly payments, as well Report on Form 10-K for the year ended For Hill’s Pet Nutrition as many other features. If you would December 31, 2019. In addition, in 1-800-445-5777 like to learn more about the Plan or to 2019, Colgate’s Chief Executive Officer enroll, please contact Computershare: submitted the annual certification to the Corporate Communications NYSE regarding Colgate’s compliance (212) 310-2551 Computershare with the NYSE corporate governance Media Inquiries PO Box 505000 listing standards. (212) 310-2670 Louisville, KY 40233 1-800-756-8700 or (781) 575-3301 Forward-Looking Statements Email: ST colgate_palmolive_media_inquiries@ Email: This 2019 Annual Report may contain Colgate Introduces colpal.com 1 [email protected] forward-looking statements. These Of-Its-Kind Recyclable Toothpaste Tube statements are made on the basis of More information about Colgate and our Website: our views and assumptions as of this products is available on the Company’s www.computershare.com/investor time, and we undertake no obligation to website at www.colgatepalmolive.com. Colgate’s first-of-its-kind recyclable toothpaste tube, Hearing impaired: update these statements. We caution which is certified by the Association of Plastic Recyclers, TDD 1-800-952-9245 investors that any such forward-looking © 2020 Colgate-Palmolive Company statements are not guarantees of future is made from the same plastic used to make bottles, Design by Robert Webster Inc. (RWI), Annual Meeting performance and that actual events or www.rwidesign.com so it recycles like a bottle and squeezes comfortably Colgate’s shareholders are invited to at- results may differ materially from those Major Photography by Greg Morris like a tube. Consistent with the Company’s values and tend our annual meeting, which will be statements. Investors should consult www.gregmorrisphotographer.com sustainability goals, Colgate is sharing this innovative held exclusively online via live webcast. the Company’s filings with the Securities Printing by Universal Wilde technology with other companies as part of its It will be held at 10:00 a.m. ET on Friday, and Exchange Commission (including the information set forth under the caption campaign to increase recyclability of toothpaste tubes. May 8, 2020 and can be accessed at C www.virtualshareholdermeeting.com/ “Risk Factors” in the Company’s Annual CL2020. Even if you plan to attend the Report on Form 10-K for the year ended virtual meeting, please vote by proxy. December 31, 2019) for information You may do so by using the telephone, about certain factors that could cause the internet or your proxy card. such differences. 38084.COVER.CC2020.indd 2 3/16/20 8:56 AM DEAR COLGATE SHAREHOLDERS Noel Wallace President and Chief Executive Officer As reflected in the title of this year’s annual report, is now available in both Europe and North America, and, 2019 was a year of Accelerating Growth for Colgate. Net as of 2019, a total of 16 Colgate manufacturing facilities sales increased 1.0% from 2018 and organic sales, or have achieved Green Business Certification Inc. (GBCI) net sales excluding foreign exchange, acquisitions and TRUE Zero Waste certification. Our sustainability efforts divestments, grew 4.0%*. Encouragingly, our growth were recognized by the Dow Jones Sustainability Indices accelerated throughout the year, as each quarter’s for the third year in a row and Colgate was named the growth increased sequentially from the prior quarter. leading company in the household products industry for Our growth was broad based, as we delivered organic the first time. sales growth in every division and across all four of our As we begin 2020, we remain sharply focused on our categories: oral care, personal care, home care and pet sustainability commitments and have strong plans in nutrition. We increased advertising investment both on place to continue our organic sales growth momentum an absolute basis and as a percent of net sales versus and to maximize productivity across the income 2018 and believe our investments in advertising and statement. innovation drove our growth. We maintained our strong balance sheet and Driving Organic Sales Growth increased operating cash flow, which led the Board of Our growth strategy centers around three key initiatives: Directors to authorize an increase in the quarterly cash driving premium innovation in our core businesses, dividend, effective in the second quarter of 2019. This pursuing adjacent categories and expanding in faster- was our 57th consecutive year of dividend increases growing channels and markets. and our 124th consecutive year paying a dividend. We also made significant prog- ress on our sustainability initiatives. We launched the first-of-its-kind recyclable toothpaste tube, which The global relaunch of Hill’s Science Diet pet food with upgraded recipes, improved kibble shapes and redesigned package graphics generated strong growth for Hill’s in 2019. *For a reconciliation of organic sales growth to net sales growth, see page 43 of the Company’s Annual Report on Form 10-K. 2019 Annual Report | 1 We are accelerating growth through the core of our vegan shower gels and liquid hand soaps and Ajax Eco- business, which is a significant part of our portfolio. Respect biodegradable wipes. In 2019, we advanced our toothpaste portfolio with We are also excited about the expansion of our skin a major relaunch behind Colgate Total, including new health portfolio. In 2018, we acquired PCA Skin and breakthrough technology. Now in over 100 countries, this EltaMD, two professional skin care businesses that innovation allowed us to take pricing on Colgate Total, continue to perform well for us. In 2019, we added which accelerated our organic sales growth and helped Filorga, a premium, anti-aging skin care brand focused grow the multi-benefit segment.