Total Debt (Carrying Amount)
Total Debt (Fair Value)
Weighted-average Interest Rate on Debt
Interest Costs Incurred
Adjusted Interest Coverage Ratio

Colgate-Palmolive Co., balance sheet: debt

US$ in millions

	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
Notes and loans payable	11)	39)	258)	260)	12)
Current portion of long-term debt	14)	12)	9)	254)	—)
Long-term debt, excluding current portion	8,741)	7,194)	7,334)	7,333)	6,354)
Total debt (carrying amount)	8,766)	7,245)	7,601)	7,847)	6,366)

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

Notes and loans payable: This category shows a significant decrease over the analyzed period. Starting at $12 million in 2018, the value peaks at $260 million in 2020, followed by a sharp decline to $39 million in 2021 and further down to $11 million in 2022. The data indicates a short-term liability trend that surged momentarily but was substantially reduced thereafter.
Current portion of long-term debt: The current portion of long-term debt was absent in 2018, appearing at $254 million in 2019, then dramatically dropping to $9 million in 2020. Subsequent years show a slight increase to $12 million in 2021 and $14 million in 2022. This pattern reflects an unusual peak in 2019 followed by stabilization at a relatively low level.
Long-term debt, excluding current portion: Long-term debt excluding the current portion demonstrates a consistent upward trend with minor fluctuations. It increased from $6,354 million in 2018 to $7,333 million in 2019, remaining almost flat at $7,334 million in 2020. There was a slight decrease to $7,194 million in 2021, followed by a notable rise to $8,741 million in 2022. This suggests a steady reliance on long-term financing with a considerable increase in the most recent year.
Total debt (carrying amount): Total debt mirrors the changes in its components, rising from $6,366 million in 2018 to a peak of $7,847 million in 2019. It then declines to $7,601 million in 2020 and further to $7,245 million in 2021. In 2022, total debt reaches its highest point at $8,766 million. This pattern signifies an overall growth in total debt load, driven primarily by the increase in long-term debt in the latest period.

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	Dec 31, 2022
Selected Financial Data (US$ in millions)
Notes and loans payable	11)
Long-term debt, including current portion	8,184)
Total debt (fair value)	8,195)
Financial Ratio
Debt, fair value to carrying amount ratio	0.93

Based on: 10-K (reporting date: 2022-12-31).

Weighted average interest rate on debt: 2.50%

Interest rate	Debt amount¹	Interest rate × Debt amount
2.60%	6,933)	180)
2.10%	1,778)	37)
Total	8,711)	218)
2.50%

Based on: 10-K (reporting date: 2022-12-31).

¹ US$ in millions

² Weighted-average interest rate = 100 × 218 ÷ 8,711 = 2.50%

Colgate-Palmolive Co., interest costs incurred

US$ in millions

12 months ended:	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
Interest expense	167)	117)	183)	192)	193)
Interest capitalized	5)	3)	1)	1)	2)
Interest incurred	172)	120)	184)	193)	195)

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

Interest Expense: The interest expense exhibited a slight decline from 193 million US dollars at the end of 2018 to 183 million in 2020. Thereafter, there was a more pronounced decrease to 117 million by the close of 2021. However, this trend reversed somewhat in 2022, with the interest expense increasing to 167 million.
Interest Capitalized: Interest capitalized remained relatively low and stable between 1 and 3 million US dollars from 2018 through 2021. In 2022, this figure increased more notably, reaching 5 million US dollars, indicating a rising proportion of interest costs being added to asset values rather than expensed immediately.
Interest Incurred: The total interest incurred closely followed the pattern of interest expense, starting at 195 million US dollars in 2018, slightly decreasing to 184 million by 2020, and then experiencing a sharp drop to 120 million in 2021. In 2022, interest incurred rose again to 172 million, partially reversing the prior year's decline.
Overall Trends and Insights: Over the five-year span, interest costs demonstrated a general downward trend until 2021, followed by a recovery in 2022. The notable reduction in 2021 suggests reduced borrowing costs or lower debt levels during that period. The increase in capitalized interest in 2022 may indicate higher investments in capital projects. The partial rebound in interest expense and incurred costs after 2021 points to either increased debt or higher interest rates affecting financing expenses during the most recent year.

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	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
Selected Financial Data (US$ in millions)
Net income attributable to Colgate-Palmolive Company	1,785)	2,166)	2,695)	2,367)	2,400)
Add: Net income attributable to noncontrolling interest	182)	172)	165)	160)	158)
Add: Income tax expense	693)	749)	787)	774)	906)
Add: Interest expense	167)	117)	183)	192)	193)
Earnings before interest and tax (EBIT)	2,827)	3,204)	3,830)	3,493)	3,657)

Interest incurred	172)	120)	184)	193)	195)
Financial Ratio With and Without Capitalized Interest
Interest coverage ratio (without capitalized interest)¹	16.93	27.38	20.93	18.19	18.95
Adjusted interest coverage ratio (with capitalized interest)²	16.44	26.70	20.82	18.10	18.75

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

2022 Calculations

¹ Interest coverage ratio (without capitalized interest) = EBIT ÷ Interest expense
= 2,827 ÷ 167 = 16.93

² Adjusted interest coverage ratio (with capitalized interest) = EBIT ÷ Interest incurred
= 2,827 ÷ 172 = 16.44

Interest Coverage Ratio (without capitalized interest): The interest coverage ratio exhibited some fluctuations over the five-year period. It started at a high level of 18.95 in 2018, slightly decreased to 18.19 in 2019, then increased significantly to 20.93 in 2020, reaching a peak of 27.38 in 2021. However, in 2022, the ratio declined sharply to 16.93. This pattern indicates an overall ability to cover interest expenses with earnings that improved up to 2021 but weakened notably in the most recent year.
Adjusted Interest Coverage Ratio (with capitalized interest): The adjusted interest coverage ratio follows a similar trend as the non-adjusted ratio. It began at 18.75 in 2018, decreased slightly to 18.10 in 2019, then rose to 20.82 in 2020 and peaked at 26.70 in 2021. In 2022, it also experienced a considerable drop to 16.44. This reflects a comparable pattern, with coverage strength peaking in 2021 before deteriorating in 2022.
Overall Insights: Both interest coverage ratios demonstrate a period of strengthening interest payment capacity from 2019 through 2021, likely linked to increased earnings or reduced interest expenses. The subsequent decline in 2022 suggests a reduction in earnings relative to interest obligations or increased interest expenses. The proximity of values between adjusted and non-adjusted ratios indicates that capitalized interest has a limited impact on the coverage ratio dynamics during these years.

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Colgate-Palmolive Co. (NYSE:CL)

Analysis of Debt

Total Debt (Carrying Amount)

Total Debt (Fair Value)

Weighted-average Interest Rate on Debt

Interest Costs Incurred

Adjusted Interest Coverage Ratio