Colgate-Palmolive reported that net sales fell 0.5% in the second quarter and forecast a low-single digit increase for 2017 amid “challenging” market conditions.
The consumer products giant said net sales dropped to $3.83 billion from $3.85 billion a year earlier, missing analysts’ estimates of $3.90 billion. Net income fell to $524 million, or 59 cents a share, from $600 million, or 67 cents a share, in the same period a year ago.
Excluding non-recurring items, earnings per share came to 72 cents, in line with the FactSet consensus of 72 cents.
Colgate still leads the global toothpaste market with a 43.6% share but oral, personal and home care revenue slipped to $3.25 billion from $3.27 billion. Pet nutrition revenue was flat at $572 million, missing expectations of $577 million.
“The second quarter was another challenging one,” CEO Ian Cook said in a news release, noting that organic sales “were even with the year ago quarter, below our expectations as a result of continued softness in North America and challenges in Asia Pacific.”
Organic sales declined 3.5% in North America, due in part to market share losses in the U.S. dish liquid business, and by the same amount in Asia Pacific.
Colgate said Asia Pacific sales had been affected by tax-related inventory reductions by wholesalers, increased competitive activity in Australia, and consumption declines in Thailand.
“Uncertainty in global markets and slowing category growth worldwide remain challenging,” Cook said. “Based on current spot rates, we continue to expect a low-single-digit net sales increase for 2017, and given our slower than expected first half, we are now planning for low-single-digit organic sales growth for 2017.”
Colgate shares tumbled 3.6% in pre-market trading Friday but rallied in the regular session, closing up 1.6% at $73.27. The stock is up about 12% year to date.