Colgate-Palmolive has raised its full-year guidance after committing to pass on higher raw material and logistics costs through further price increases for its products.
The consumer goods group, whose brands include Speed Stick deodorant and soft soap, raised its full-year guidance for organic sales growth by 1 percentage point to 5% to 7%, but kept its guidance for net sales growth in the range of 1% to 4%.
The toothpaste maker reported a 5.5 percent increase in net sales to $4.48 billion for the second quarter, which beat analysts’ estimates of $4.35 billion and a 5.5 percent increase, according to a Refinitiv poll compared to the previous year. Organic sales increased 9 percent, with gains across all divisions.
Colgate reported an increase in raw material, packaging and logistics costs for the quarter and a 3.5 percent negative impact on net sales from volatile currencies.
“We have acted boldly on pricing and are accelerating our management plans for revenue growth, including additional pricing, throughout the year,” Chief Executive Officer Noel Wallace said in a statement.
Speaking to analysts, he said price increases would be “broad-based globally” in the second half of the year.
“It’s an unpredictable environment in terms of consumer trajectory and inflation trajectory,” he said. “But the good news is that we’ve taken over pricing and we have more pricing planned around the world moving into the back half.”
The New York-based company reported diluted earnings of 72 cents per share, ahead of guidance of 71 cents.
Colgate has become the latest consumer goods company to pass higher inflation costs on to its customers after moves have been made by Nestlé, Kraft Heinz, Danone and Unilever.