posted a solid fourth quarter and said it expects to see double-digit earnings growth in 2006.
The New York-based toothpaste giant made $361 million, or 65 cents a share, for the quarter ended Dec. 31, up from the year-ago $286 million, or 50 cents a share. Excluding restructuring and other costs, latest quarter earnings were 69 cents a share, a penny ahead of the Thomson First Call analyst consensus estimate. Revenue rose to $2.9 billion from $2.8 billion a year earlier but fell shy of the $2.95 billion Wall Street estimate.
Strong growth continued in North America, fueled by new product sales and market share gains. Sales and unit volume in the quarter, excluding divestments, grew 8.5% and 6.0%, respectively, on top of very strong growth in the year-ago period. Sales as reported rose only 1.0% during the quarter because of the year-on-year impact of the divestment of Colgate's U.S. detergent business.
Colgate's U.S. toothpaste leadership market share continued to grow, with its ACNielsen market share reaching 35.3% year to date, up 40 basis points vs. the year-ago period.
Strong new product activity is planned for 2006. New introductions planned for launch during first quarter 2006 include Softsoap Pure Cashmere moisturizing body wash, Palmolive Odor Eliminator dish liquid, Speed Stick deodorant with Irish Spring scents and a relaunch of the entire line of Softsoap body washes with an improved formula and new packaging.
"It's great to see we are back on track with strong gross profit margin increases," said CEO Reuben Mark. "The excellent 100 basis point improvement in gross profit margin excluding restructuring charges during the quarter exceeded our expectations, and was the largest quarterly gross profit increase we have seen in three years. This increase, combined with a reduction in overhead expenses, allowed us to build our overall profitability while still investing in even stronger levels of advertising behind our global brands.
"Looking forward, we expect our growth momentum to continue as we enter 2006. We are confident that, excluding restructuring charges and accounting changes for stock-based compensation, we will generate double-digit earnings per share growth in 2006, beginning in the first quarter."