Colgate-Palmolive has said that its decision to invest more in digital and e-commerce has helped deliver growth across its portfolio, as the business posted a 7.5% net sales increase in the fourth quarter.
The group said that all of its divisions posted sales growth in the quarter, with net sales in North America up 10.0%, and Europe up 14.0%.
'Deliver Growth'
“Our choices to invest in innovation, digital transformation and advertising are helping to deliver growth across our portfolio," commented Noel Wallace, Colgate-Palmolive chairman, president and CEO.
"While several of our categories continue to benefit from higher consumer demand due to the COVID-19 pandemic, we believe we have the right strategies in place to deliver profitable growth over the longer term."
In a conference call with analysts, Wallace added that the group's e-commerce business has shown growth in both developed and developing markets, with China in particular leading the way in terms of driving the business' e-commerce capabilities.
The group has invested quite considerably in its digital platforms in the past year, and this appears to be paying off, with e-commerce accounting for a 'double digit percentage' of sales at year-end, the company confirmed.
Europe Performance
In Europe, which accounts for around 17% of the company's sales, organic sales growth was driven by Poland, the United Kingdom, Germany and France.
It posted a 1% decrease in profits in Europe in the fourth quarter, which it said was largely due to increased advertising investment, higher raw and packaging material costs, unfavourable mix and lower pricing. This decline was partially offset by cost savings from the group's 'funding-the-growth' initiatives.
In terms of full-year guidance for 2021, Colgate-Palmolive said that it expects net sales to be up between 4% and 7%, including a low single-digit benefit from foreign exchange.
“Our strong gross profit performance in the quarter funded a significant increase in advertising while still allowing us to deliver increases in operating profit, net income and earnings per share on a base business basis," commented Wallace. "The increased investment was widespread across categories and geographies in support of new product launches, expanded eCommerce activity and strengthened digital engagement.
“As we enter 2021, we expect high levels of uncertainty as we lap the benefits from pantry loading and other impacts of the COVID-19 pandemic. We also expect volatility in raw material and logistics costs and foreign exchange."
© 2021 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.
