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About The Mennen Company

Colgate-Palmolive takes a bite out of grime. The company is a top global maker and marketer of toothpaste (it has more than 40% of the global market) and soap and cleaning products. Colgate-Palmolive also offers pet nutrition products through subsidiary Hill's Pet Nutrition, which makes Science Diet, Ideal Balance, and Prescription Diet pet foods. Many of its oral care products fall under the Colgate brand and include toothbrushes, mouthwash, and dental floss. Its Tom's of Maine unit covers the natural toothpaste niche. Personal and home care items include Ajax brand household cleaner, Palmolive dishwashing liquid, Softsoap shower gel, and Sanex and Speed Stick deodorants. The company has operations in 80-plus countries and sells its products in more than 200 countries.

Operations

Colgate-Palmolive operates through two product segments: Oral, Personal, and Home Care (85% of sales); and Pet Nutrition (15%). Within the larger segment, oral care products account for 50% of sales, while personal and home care each account for about 20%.

Colgate is a leader in the global oral care market with the leading toothpaste and manual toothbrush brands in many parts of the world. The oral care business also includes dental floss and pharmaceutical products for dentists and other oral health practitioners.

Through its Hill's Pet Nutrition segment, Colgate-Palmolive is a world leader in specialty pet nutrition products for dogs and cats with products marketed in more than 80 countries worldwide.

Geographic Reach

About 75% of Colgate-Palmolive's revenue is generated from markets outside the US, with more than 50% coming from emerging markets (Latin America, Asia -- excluding Japan, Africa/Eurasia, and Central Europe).

The primary research center for Oral, Personal and Home Care products is in Piscataway, New Jersey, while Topeka, Kanas is home to the Pet Nutrition products research center. The company’s global data center is in Piscataway.

Outside of the US, Colgate-Palmolive operates about 250 properties, of which 70 are company owned, in more than 80 countries. Major non-US facilities for the Oral, Personal, and Home Care segment are in Australia, Brazil, China, Colombia, France, Greece, Guatemala, India, Italy, Mexico, Poland, South Africa, Thailand, Turkey, Venezuela, and Vietnam. The Pet Nutrition business has major plants in the Czech Republic and the Netherlands. Such widespread international operations open Colgate-Palmolive to political, trade, and cultural volatility.

Colgate-Palmolive also has shared business service centers in Mexico, Poland, and India.

Sales and Marketing

Colgate-Palmolive markets its products through advertising, including TV and print, and other promotional activities. It has a direct sales force at individual operating subsidiaries and business units and also uses distributors or brokers. Already a big advertiser, Colgate-Palmolive has increased advertising spending to about $5.4 billion in traditional and digital media to drive sales higher.

Oral, Personal, and Home Care sales to Wal-Mart represent about 10% of the company's total annual sales.

Financial Performance

Colgate-Palmolive in 2017 arrested a three-year slide that cut revenue 14% after it posted sales of $17.4 billion (a company high) in 2013.

Sales inched 1.5% higher to $15.4 billion in 2017 from $15.2 billion in 2016 with organic sales up 1%for the year. The Oral, Personal and Home Care product segment's sales were up 2% in 2017 on higher toothpaste sales (Oral products) while Personal Care and Home Care sales were lower. Hill’s Pet Nutrition sales ticked up 1% in 2017 on strength in the Prescription Diet category. Latin America outpaced other geographic areas with 6.5% revenue growth in 2017 from 2016.

Net income fell to $2 billion in 2017 from $2.4 billion in 2016 due to after-tax charges associated with the company’s Global Growth and Efficiency Program, as well as a charge related to the US Tax Cuts and Jobs Act.

Colgate-Palmolive had $1.5 billion in cash and equivalents in 2017 compared to $1.3 billion in 2016. In 2017, cash provided by operations totaled $3 billion in 2017 while investing activities used $471 million and financing activities used $2.4 billion.

Strategy

Colgate-Palmolive's goal is to increase its market share in key product categories, and the company is organized to get there. Its management teams function along geographic lines and are accountable for each region's business and financial results. Colgate-Palmolive points to its geographic diversity as a way to reduce its risk in any one part of its business.

A major restructuring initiative, called the Global Growth and Efficiency Program, has helped tighten Colgate-Palmolive's global supply chain and realign its sales, marketing, and new product organizations to serve both mature and developing markets. This and other cost-saving initiatives have freed additional funds to invest in product research and support. (The company's growth is reliant on the success of its existing product line, as well as the successful development and launch of new products.)

To drive increased demand, Colgate-Palmolive increased advertising spending about 10% in 2017 from 2016. The company saw results with accelerated growth in the second half of 2017. It also has shifted more ad spending to digital media.

Colgate-Palmolive has begun to develop e-commerce as a source of revenue, investing in strategies to appear on the first page of pertinent search results and providing packaging designed for shipping products straight to consumers. The company claims to the market leader in toothpaste bought online in the US, the UK, and China.

 

Mergers and Acquisitions

In 2018 Colgate-Palmolive acquired PCA Skin and Elta MD, two fast-growing brands in skin care, for about $730 million. The acquisition enables Colgate to enter attractive professional skin care category. PCA Skin offers medical-grade in-office and take-home skin care products, while EltaMD is a physician-dispensed sun care brand.

Company Background

William Colgate founded The Colgate Company in Manhattan in 1806 to produce soap, candles, and starch. Colgate died in 1857, and the company was passed to his son Samuel, who renamed it Colgate and Company. In 1873 the company introduced toothpaste in jars, and in 1896 it began selling Colgate Dental Cream in tubes. By 1906 Colgate was making 160 kinds of soap, 625 perfumes, and 2,000 other products. The company went public in 1908.

In 1898 Milwaukee's B. J. Johnson Soap Company (founded 1864) introduced Palmolive, a soap made of palm and olive oils rather than smelly animal fats. It became so popular that the firm changed its name to The Palmolive Company in 1916. Ten years later Palmolive merged with Peet Brothers, a Kansas City-based soap maker founded in 1872. Palmolive-Peet merged with Colgate in 1928, forming Colgate-Palmolive-Peet (shortened to Colgate-Palmolive in 1953).

The Mennen Company

191 E HANOVER AVE
Morristown, NJ 07960-3100
Phone: 1 (973) 630-1500

Stats

Employer Type: Privately Owned
Vice President Treas: Brian J Heidtke
Vice President sec: Andrew Hendry
Employees (This Location): 403
Employees (All Locations): 420

Major Office Locations

Morristown, NJ