Name: Colgate-Palmolive Co. (NYSE:CL) | Income Statement
Creator: Stock Analysis on Net

Income Statement

The income statement presents information on the financial results of a company business activities over a period of time. The income statement communicates how much revenue the company generated during a period and what cost it incurred in connection with generating that revenue.

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Colgate-Palmolive Co., consolidated income statement

US$ in millions

12 months ended:	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
Net sales	17,967)	17,421)	16,471)	15,693)	15,544)
Cost of sales	(7,719)	(7,046)	(6,454)	(6,368)	(6,313)
Gross profit	10,248)	10,375)	10,017)	9,325)	9,231)
Selling, general and administrative expenses	(6,565)	(6,407)	(6,019)	(5,575)	(5,389)
Global Growth and Efficiency Program	—)	—)	13)	(57)	(88)
Amortization of intangible assets	(80)	(89)	(88)	(62)	(59)
Equity income	12)	12)	12)	9)	10)
Gains from marketable securities and other assets	22)	8)	2)	—)	—)
Indirect tax refunds	14)	5)	(3)	—)	—)
Value-added tax matter in Brazil	—)	26)	—)	30)	—)
Acquisition-related costs	(19)	—)	(2)	(21)	—)
2022 Global Productivity Initiative	(90)	—)	—)	—)	—)
Gain on the sale of land in Asia Pacific	47)	—)	—)	—)	—)
Charges for a change in go-to-market strategy in certain countries	—)	—)	—)	(15)	—)
Other, net	25)	(27)	(47)	(80)	(11)
Other income (expense), net	(69)	(65)	(113)	(196)	(148)
Goodwill and intangible assets impairment charges	(721)	(571)	—)	—)	—)
Operating profit	2,893)	3,332)	3,885)	3,554)	3,694)
Non-service related postretirement costs	(80)	(70)	(74)	(108)	(87)
Interest expense	(167)	(117)	(183)	(192)	(193)
Interest income	14)	17)	19)	47)	50)
Loss on early extinguishment of debt	—)	(75)	—)	—)	—)
Interest income (expense), net	(153)	(175)	(164)	(145)	(143)
Income before income taxes	2,660)	3,087)	3,647)	3,301)	3,464)
Provision for income taxes	(693)	(749)	(787)	(774)	(906)
Net income including noncontrolling interests	1,967)	2,338)	2,860)	2,527)	2,558)
Net income attributable to noncontrolling interests	(182)	(172)	(165)	(160)	(158)
Net income attributable to Colgate-Palmolive Company	1,785)	2,166)	2,695)	2,367)	2,400)

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).

A comprehensive analysis of the income statement from 2018 to 2022 reveals a divergence between top-line revenue growth and bottom-line profitability. While net sales demonstrated consistent year-over-year increases, operating and net income experienced a downward trend, particularly in the final two years of the period.

Revenue and Gross Profitability: Net sales grew steadily from 15,544 million US$ in 2018 to 17,967 million US$ in 2022. However, the cost of sales increased at a faster rate toward the end of the period, rising from 6,313 million US$ in 2018 to 7,719 million US$ in 2022. This resulted in gross profit peaking in 2021 at 10,375 million US$ before declining to 10,248 million US$ in 2022, indicating a compression of the gross margin in the most recent fiscal year.
Operating Expenses and Efficiency: Selling, general, and administrative expenses showed a continuous upward trajectory, increasing from 5,389 million US$ in 2018 to 6,565 million US$ in 2022. This steady rise in overhead, combined with the increasing cost of sales, exerted significant pressure on operating margins. Consequently, operating profit declined from a peak of 3,885 million US$ in 2020 to 2,893 million US$ in 2022.
Non-Recurring Charges and Impairments: The deterioration of operating profit was heavily influenced by substantial goodwill and intangible asset impairment charges in the latter part of the period, specifically 571 million US$ in 2021 and 721 million US$ in 2022. Other volatile items, such as the 2022 Global Productivity Initiative cost of 90 million US$ and various acquisition-related costs, further impacted the operational results, although these were partially offset by occasional gains, such as the 47 million US$ gain on the sale of land in Asia Pacific in 2022.
Net Income and Bottom-Line Performance: Net income attributable to the company peaked in 2020 at 2,695 million US$ but fell sharply to 1,785 million US$ by 2022. This decline represents a significant reduction in net profit margins despite the growth in total sales. Interest income (expense), net, remained relatively stable, fluctuating between 143 million US$ and 175 million US$, suggesting that the decline in net income was driven primarily by operating inefficiencies and non-cash impairment charges rather than financing costs.

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