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Colgate Announces 4th Quarter And Full Year 2012 Results

In the U.S., Colgate’s toothpaste market share reached 36.1% year to date, up 1.0 share point versus year ago, driven by strong sales of Colgate Optic White and Colgate Optic White Enamel White toothpastes. In manual toothbrushes, Colgate’s leading market share reached 35.7% year to date, up 2.1 share points versus year ago, driven by the success of Colgate 360° Optic White, Colgate 360° Sensitive Pro-Relief and Colgate Extra Clean manual toothbrushes.

Successful products driving growth in the U.S. in other categories include Colgate Optic White mouthwash, Softsoap brand Pampered Hands Coconut Lime Parfait foaming hand soap, Softsoap brand Citrus Splash & Berry Fusion body wash, Palmolive Soft Touch with Coconut Butter dish liquid, Suavitel fabric conditioner and Fabuloso liquid cleaner.

Exciting new products launching in first quarter 2013 include Colgate 360° Total Advanced Floss Tip bristles manual toothbrush, Colgate Optic White Dual Action toothpaste and Colgate Total Zx Pro-Shield Plus Sensitivity toothpaste offering long-lasting protection for teeth, gums and sensitivity.

Latin America (29% of Company Sales)

Latin America Net sales increased 1.5% in fourth quarter 2012. Unit volume decreased 1.5% with 5.0% higher pricing and 2.0% negative foreign exchange. Excluding divested businesses, Latin America unit volume decreased 1.0%. Volume gains in Brazil and Central America were offset by volume declines in Venezuela. Organic sales for Latin America increased 4.0% during the quarter.

Operating profit in Latin America decreased 4% in the fourth quarter of 2012 to $348 million, or 28.5% of Net sales. This decrease in Operating profit was due to a decrease in Gross profit and an increase in Selling, general and administrative expenses, both as a percentage of Net sales. This decrease in Gross profit was due to higher raw and packaging material costs and the increasingly difficult economic and labor environment in Venezuela, which likewise impacted unit volume in that country. Increasingly during the quarter, production at CP Venezuela was negatively impacted by labor issues that we understand also affected a number of other companies within the country. The decrease in Gross profit was partially offset by cost savings from the Company’s funding-the-growth initiatives and higher pricing. This increase in Selling, general and administrative expenses was primarily due to higher overhead expenses and higher advertising expenses, both as a percentage of Net sales. This increase in overhead expenses was mainly due to higher costs due to inflation, particularly in Venezuela.

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