QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the transition period from________ to________ . |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
☒ | Accelerated filer | ☐ | |||||||||
Non-accelerated filer | ☐ | Smaller reporting company | |||||||||
Emerging growth company |
Class | Shares Outstanding | Date | ||||||||||||
Common stock, $1.00 par value | March 31, 2022 |
Three Months Ended | |||||||||||
March 31, | |||||||||||
2022 | 2021 | ||||||||||
Net sales | $ | $ | |||||||||
Cost of sales | |||||||||||
Gross profit | |||||||||||
Selling, general and administrative expenses | |||||||||||
Other (income) expense, net | |||||||||||
Operating profit | |||||||||||
Non-service related postretirement costs | |||||||||||
Interest (income) expense, net | |||||||||||
Income before income taxes | |||||||||||
Provision for income taxes | |||||||||||
Net income including noncontrolling interests | |||||||||||
Less: Net income attributable to noncontrolling interests | |||||||||||
Net income attributable to Colgate-Palmolive Company | $ | $ | |||||||||
Earnings per common share, basic | $ | $ | |||||||||
Earnings per common share, diluted | $ | $ | |||||||||
Three Months Ended | |||||||||||
March 31, | |||||||||||
2022 | 2021 | ||||||||||
Net income including noncontrolling interests | $ | $ | |||||||||
Other comprehensive income (loss), net of tax: | |||||||||||
Cumulative translation adjustments | ( | ||||||||||
Retirement plans and other retiree benefit adjustments | |||||||||||
Gains (losses) on cash flow hedges | |||||||||||
Total Other comprehensive income (loss), net of tax | ( | ||||||||||
Total Comprehensive income including noncontrolling interests | |||||||||||
Less: Net income attributable to noncontrolling interests | |||||||||||
Less: Cumulative translation adjustments attributable to noncontrolling interests | ( | ( | |||||||||
Total Comprehensive income attributable to noncontrolling interests | |||||||||||
Total Comprehensive income attributable to Colgate-Palmolive Company | $ | $ |
March 31, 2022 | December 31, 2021 | ||||||||||
Assets | |||||||||||
Current Assets | |||||||||||
Cash and cash equivalents | $ | $ | |||||||||
Receivables (net of allowances of $ | |||||||||||
Inventories | |||||||||||
Other current assets | |||||||||||
Total current assets | |||||||||||
Property, plant and equipment: | |||||||||||
Cost | |||||||||||
Less: Accumulated depreciation | ( | ( | |||||||||
Goodwill | |||||||||||
Other intangible assets, net | |||||||||||
Deferred income taxes | |||||||||||
Other assets | |||||||||||
Total assets | $ | $ | |||||||||
Liabilities and Shareholders’ Equity | |||||||||||
Current Liabilities | |||||||||||
Notes and loans payable | $ | $ | |||||||||
Current portion of long-term debt | |||||||||||
Accounts payable | |||||||||||
Accrued income taxes | |||||||||||
Other accruals | |||||||||||
Total current liabilities | |||||||||||
Long-term debt | |||||||||||
Deferred income taxes | |||||||||||
Other liabilities | |||||||||||
Total liabilities | |||||||||||
Shareholders’ Equity | |||||||||||
Common stock, $ | |||||||||||
Additional paid-in capital | |||||||||||
Retained earnings | |||||||||||
Accumulated other comprehensive income (loss) | ( | ( | |||||||||
Unearned compensation | ( | ||||||||||
Treasury stock, at cost | ( | ( | |||||||||
Total Colgate-Palmolive Company shareholders’ equity | |||||||||||
Noncontrolling interests | |||||||||||
Total equity | |||||||||||
Total liabilities and equity | $ | $ |
Three Months Ended | |||||||||||
March 31, | |||||||||||
2022 | 2021 | ||||||||||
Operating Activities | |||||||||||
Net income including noncontrolling interests | $ | $ | |||||||||
Adjustments to reconcile net income including noncontrolling interests to net cash provided by operations: | |||||||||||
Depreciation and amortization | |||||||||||
Restructuring and termination benefits, net of cash | ( | ||||||||||
Stock-based compensation expense | |||||||||||
Deferred income taxes | ( | ||||||||||
Cash effects of changes in: | |||||||||||
Receivables | ( | ( | |||||||||
Inventories | ( | ( | |||||||||
Accounts payable and other accruals | ( | ( | |||||||||
Other non-current assets and liabilities | ( | ( | |||||||||
Net cash provided by (used in) operations | |||||||||||
Investing Activities | |||||||||||
Capital expenditures | ( | ( | |||||||||
Purchases of marketable securities and investments | ( | ( | |||||||||
Proceeds from sale of marketable securities and investments | |||||||||||
Other investing activities | ( | ||||||||||
Net cash provided by (used in) investing activities | ( | ( | |||||||||
Financing Activities | |||||||||||
Short-term borrowing (repayment) less than 90 days, net | |||||||||||
Proceeds from issuance of debt | |||||||||||
Dividends paid | ( | ( | |||||||||
Purchases of treasury shares | ( | ( | |||||||||
Proceeds from exercise of stock options | |||||||||||
Other financing activities | ( | ( | |||||||||
Net cash provided by (used in) financing activities | ( | ( | |||||||||
Effect of exchange rate changes on Cash and cash equivalents | ( | ||||||||||
Net increase (decrease) in Cash and cash equivalents | |||||||||||
Cash and cash equivalents at beginning of the period | |||||||||||
Cash and cash equivalents at end of the period | $ | $ | |||||||||
Supplemental Cash Flow Information | |||||||||||
Income taxes paid | $ | $ |
Three Months Ended March 31, 2022 | |||||||||||||||||||||||||||||||||||||||||
Colgate-Palmolive Company Shareholders’ Equity | |||||||||||||||||||||||||||||||||||||||||
Common Stock | Additional Paid-in Capital | Unearned Compensation | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Income (Loss)(1) | Noncontrolling Interests | |||||||||||||||||||||||||||||||||||
Balance, December 31, 2021 | $ | $ | $ | ( | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss), net of tax | — | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||
Dividends ($ | — | — | — | — | ( | — | — | ||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||
Shares issued for stock options | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Shares issued for restricted stock units | — | ( | — | — | — | — | |||||||||||||||||||||||||||||||||||
Treasury stock acquired | — | — | — | ( | — | — | — | ||||||||||||||||||||||||||||||||||
Other | — | ( | — | ||||||||||||||||||||||||||||||||||||||
Balance, March 31, 2022 | $ | $ | $ | $ | ( | $ | $ | ( | $ |
Three Months Ended March 31, 2021 | |||||||||||||||||||||||||||||||||||||||||
Colgate-Palmolive Company Shareholders’ Equity | |||||||||||||||||||||||||||||||||||||||||
Common Stock | Additional Paid-in Capital | Unearned Compensation | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Income (Loss)(1) | Noncontrolling Interests | |||||||||||||||||||||||||||||||||||
Balance December 31, 2020 | $ | $ | $ | ( | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss), net of tax | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
Dividends ($ | — | — | — | — | ( | — | |||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||
Shares issued for stock options | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Shares issued for restricted stock units | — | ( | — | — | — | — | |||||||||||||||||||||||||||||||||||
Treasury stock acquired | — | — | — | ( | — | — | — | ||||||||||||||||||||||||||||||||||
Other | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||
Balance, March 31, 2021 | $ | $ | $ | $ | ( | $ | $ | ( | $ |
Three Months ended March 31, | ||||||||
2022 | ||||||||
Other (income) expense, net | ||||||||
Non-service related postretirement costs | ||||||||
Total 2022 Global Productivity Initiative charges, pretax | $ | |||||||
Total 2022 Global Productivity Initiative charges, aftertax | $ |
Three Months ended March 31, | ||||||||
2022 | ||||||||
North America | % | |||||||
Latin America | % | |||||||
Europe | % | |||||||
Asia Pacific | % | |||||||
Africa/Eurasia | % | |||||||
Hill's Pet Nutrition | % | |||||||
Corporate | % | |||||||
Total | % |
Employee-Related Costs | Incremental Depreciation | Asset Impairments | Other | Total | ||||||||||||||||||||||||||||
Charges | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Cash Payments | ||||||||||||||||||||||||||||||||
Charges against assets | ( | ( | ||||||||||||||||||||||||||||||
Foreign exchange | ||||||||||||||||||||||||||||||||
Balance at March 31, 2022 | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
March 31, 2022 | December 31, 2021 | ||||||||||
Raw materials and supplies | $ | $ | |||||||||
Work-in-process | |||||||||||
Finished goods | |||||||||||
Total Inventories, net | $ | $ | |||||||||
Non-current inventory, net | $ | ( | $ | ( | |||||||
Current Inventories, net | $ | $ |
Three Months Ended | |||||||||||||||||||||||||||||||||||
March 31, 2022 | March 31, 2021 | ||||||||||||||||||||||||||||||||||
Net income attributable to Colgate-Palmolive Company | Shares (millions) | Per Share | Net income attributable to Colgate-Palmolive Company | Shares (millions) | Per Share | ||||||||||||||||||||||||||||||
Basic EPS | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
Stock options and restricted stock units | |||||||||||||||||||||||||||||||||||
Diluted EPS | $ | $ | $ | $ |
2022 | 2021 | |||||||||||||||||||||||||
Pretax | Net of Tax | Pretax | Net of Tax | |||||||||||||||||||||||
Cumulative translation adjustments | $ | $ | $ | ( | $ | ( | ||||||||||||||||||||
Retirement plans and other retiree benefits: | ||||||||||||||||||||||||||
Net actuarial gain (loss) and prior service costs arising during the period | ( | ( | ||||||||||||||||||||||||
Amortization of net actuarial loss, transition and prior service costs (1) | ||||||||||||||||||||||||||
Retirement plans and other retiree benefits adjustments | ||||||||||||||||||||||||||
Cash flow hedges: | ||||||||||||||||||||||||||
Unrealized gains (losses) on cash flow hedges | ||||||||||||||||||||||||||
Reclassification of (gains) losses into net earnings on cash flow hedges (2) | ( | ( | ||||||||||||||||||||||||
Gains (losses) on cash flow hedges | ||||||||||||||||||||||||||
Total Other comprehensive income (loss) | $ | $ | $ | ( | $ | ( |
Three Months Ended March 31, | |||||||||||||||||||||||||||||||||||
Pension Benefits | Other Retiree Benefits | ||||||||||||||||||||||||||||||||||
United States | International | ||||||||||||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||||||||||
Service cost | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Interest cost | |||||||||||||||||||||||||||||||||||
Expected return on plan assets | ( | ( | ( | ( | |||||||||||||||||||||||||||||||
Amortization of actuarial loss (gain) | |||||||||||||||||||||||||||||||||||
Net periodic benefit cost | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Other postretirement charges | |||||||||||||||||||||||||||||||||||
Total pension cost | $ | $ | $ | $ | $ | $ |
Three Months Ended | |||||||||||
March 31, | |||||||||||
2022 | 2021 | ||||||||||
Net sales | |||||||||||
Oral, Personal and Home Care | |||||||||||
North America | $ | $ | |||||||||
Latin America | |||||||||||
Europe | |||||||||||
Asia Pacific | |||||||||||
Africa/Eurasia | |||||||||||
Total Oral, Personal and Home Care | |||||||||||
Pet Nutrition | |||||||||||
Total Net sales | $ | $ |
Three Months Ended | |||||||||||
March 31, | |||||||||||
2022 | 2021 | ||||||||||
Net sales | |||||||||||
Oral Care | % | % | |||||||||
Personal Care | % | % | |||||||||
Home Care | % | % | |||||||||
Pet Nutrition | % | % | |||||||||
Total Net sales | % | % |
Three Months Ended | |||||||||||
March 31, | |||||||||||
2022 | 2021 | ||||||||||
Operating profit | |||||||||||
Oral, Personal and Home Care | |||||||||||
North America | $ | $ | |||||||||
Latin America | |||||||||||
Europe | |||||||||||
Asia Pacific | |||||||||||
Africa/Eurasia | |||||||||||
Total Oral, Personal and Home Care | |||||||||||
Pet Nutrition | |||||||||||
Corporate | ( | ( | |||||||||
Total Operating profit | $ | $ |
Assets | Liabilities | ||||||||||||||||||||||||||||||||||
Account | Fair Value | Account | Fair Value | ||||||||||||||||||||||||||||||||
Designated derivative instruments | March 31, 2022 | December 31, 2021 | March 31, 2022 | December 31, 2021 | |||||||||||||||||||||||||||||||
Interest rate swap contracts | Other current assets | $ | $ | Other accruals | $ | $ | |||||||||||||||||||||||||||||
Forward-starting interest rate swaps | Other current assets | Other accruals | |||||||||||||||||||||||||||||||||
Forward-starting interest rate swaps | Other assets | Other liabilities | |||||||||||||||||||||||||||||||||
Foreign currency contracts | Other current assets | Other accruals | |||||||||||||||||||||||||||||||||
Commodity contracts | Other current assets | Other accruals | |||||||||||||||||||||||||||||||||
Total designated | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
Other financial instruments | |||||||||||||||||||||||||||||||||||
Marketable securities | Other current assets | $ | $ | ||||||||||||||||||||||||||||||||
Total other financial instruments | $ | $ |
March 31, 2022 | December 31, 2021 | ||||||||||
Long-term debt: | |||||||||||
Carrying amount of hedged item | $ | $ | |||||||||
Cumulative hedging adjustment included in the carrying amount |
March 31, 2022 | |||||||||||||||||||||||||||||||||||
Foreign Currency Contracts | Foreign Currency Debt | Interest Rate Swaps | Forward-Starting Interest Rate Swaps | Commodity Contracts | Total | ||||||||||||||||||||||||||||||
Fair Value Hedges | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Cash Flow Hedges | |||||||||||||||||||||||||||||||||||
Net Investment Hedges |
December 31, 2021 | |||||||||||||||||||||||||||||||||||
Foreign Currency Contracts | Foreign Currency Debt | Interest Rate Swaps | Forward-Starting Interest Rate Swaps | Commodity Contracts | Total | ||||||||||||||||||||||||||||||
Fair Value Hedges | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Cash Flow Hedges | |||||||||||||||||||||||||||||||||||
Net Investment Hedges |
Three Months Ended March 31, | |||||||||||||||||||||||||||||||||||
2022 | 2021 | ||||||||||||||||||||||||||||||||||
Cost of sales | Selling, general and administrative expenses | Interest (income) expense, net | Cost of sales | Selling, general and administrative expenses | Interest (income) expense, net | ||||||||||||||||||||||||||||||
Interest rate swaps designated as fair value hedges: | |||||||||||||||||||||||||||||||||||
Derivative instrument | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Hedged items | ( | ( | |||||||||||||||||||||||||||||||||
Foreign currency contracts designated as fair value hedges: | |||||||||||||||||||||||||||||||||||
Derivative instrument | |||||||||||||||||||||||||||||||||||
Hedged items | ( | ||||||||||||||||||||||||||||||||||
Foreign currency contracts designated as cash flow hedges: | |||||||||||||||||||||||||||||||||||
Amount reclassified from OCI | ( | ||||||||||||||||||||||||||||||||||
Commodity contracts designated as cash flow hedges: | |||||||||||||||||||||||||||||||||||
Amount reclassified from OCI | |||||||||||||||||||||||||||||||||||
Total gain (loss) on hedges recognized in income | $ | $ | $ | $ | ( | $ | $ |
Three Months Ended | |||||||||||
March 31, | |||||||||||
2022 | 2021 | ||||||||||
Foreign currency contracts designated as cash flow hedges: | |||||||||||
Gain (loss) recognized in OCI | $ | ( | $ | ||||||||
Forward-starting interest rate swaps designated as cash flow hedges: | |||||||||||
Gain (loss) recognized in OCI | |||||||||||
Commodity contracts designated as cash flow hedges: | |||||||||||
Gain (loss) recognized in OCI | |||||||||||
Foreign currency contracts designated as net investment hedges: | |||||||||||
Gain (loss) on instruments | ( | ||||||||||
Gain (loss) on hedged items | ( | ||||||||||
Foreign currency debt designated as net investment hedges: | |||||||||||
Gain (loss) on instruments | |||||||||||
Gain (loss) on hedged items | ( | ( | |||||||||
Total unrealized gain (loss) on hedges recognized in OCI | $ | $ |
Three Months Ended March 31, | ||||||||||||||
2022 | 2021 | |||||||||||||
Gross profit | $ | 2,572 | $ | 2,637 |
Three Months Ended March 31, | ||||||||||||||||||||
2022 | 2021 | Basis Point Change | ||||||||||||||||||
Gross profit margin | 58.5 | % | 60.7 | % | (220) |
Three Months Ended March 31, | ||||||||||||||
2022 | 2021 | |||||||||||||
Selling, general and administrative expenses | $ | 1,641 | $ | 1,605 | ||||||||||
Three Months Ended March 31, | ||||||||||||||||||||
2022 | 2021 | Basis Point Change | ||||||||||||||||||
Selling, general and administrative expenses as a percentage of Net sales | 37.3 | % | 36.9 | % | 40 |
Three Months Ended March 31, | ||||||||||||||
2022 | 2021 | |||||||||||||
Other (income) expense, net, GAAP | $ | 71 | $ | 28 | ||||||||||
2022 Global Productivity Initiative | (63) | — | ||||||||||||
Other (income) expense, net, non-GAAP | $ | 8 | $ | 28 |
Three Months Ended March 31, | ||||||||||||||||||||
2022 | 2021 | % Change | ||||||||||||||||||
Operating profit, GAAP | $ | 860 | $ | 1,004 | (14) | % | ||||||||||||||
2022 Global Productivity Initiative | 63 | — | — | |||||||||||||||||
Operating profit, non-GAAP | $ | 923 | $ | 1,004 | (8) | % |
Three Months Ended March 31, | ||||||||||||||||||||
2022 | 2021 | Basis Point Change | ||||||||||||||||||
Operating profit margin, GAAP | 19.5 | % | 23.1 | % | (360) | |||||||||||||||
2022 Global Productivity Initiative | 1.5 | % | — | % | — | |||||||||||||||
Operating profit margin, non-GAAP | 21.0 | % | 23.1 | % | (210) |
Three Months Ended March 31, | ||||||||||||||
2022 | 2021 | |||||||||||||
Non-service related postretirement costs, GAAP | $ | 38 | $ | 18 | ||||||||||
2022 Global Productivity Initiative | (19) | — | ||||||||||||
Non-service related postretirement costs, non-GAAP | $ | 19 | $ | 18 |
Three Months ended March 31, | ||||||||||||||||||||||||||||||||||||||
2022 | 2021 | |||||||||||||||||||||||||||||||||||||
Income Before Income Taxes | Provision For Income Taxes(1) | Effective Income Tax Rate(2) | Income Before Income Taxes | Provision For Income Taxes(1) | Effective Income Tax Rate(2) | |||||||||||||||||||||||||||||||||
As Reported GAAP | $ | 795 | $ | 192 | 24.2 | % | $ | 957 | $ | 229 | 23.9 | % | ||||||||||||||||||||||||||
2022 Global Productivity Initiative | 82 | 17 | (0.4) | — | — | — | ||||||||||||||||||||||||||||||||
Non-GAAP | $ | 877 | $ | 209 | 23.8 | % | $ | 957 | $ | 229 | 23.9 | % |
Three Months Ended March 31, 2022 | |||||||||||||||||||||||||||||
Income Before Income Taxes | Provision For Income Taxes(1) | Net Income Including Noncontrolling Interests | Net Income Attributable To Colgate-Palmolive Company | Diluted Earnings Per Share(2) | |||||||||||||||||||||||||
As Reported GAAP | $ | 795 | $ | 192 | $ | 603 | $ | 559 | $ | 0.66 | |||||||||||||||||||
2022 Global Productivity Initiative | 82 | 17 | 65 | 65 | 0.08 | ||||||||||||||||||||||||
Non-GAAP | $ | 877 | $ | 209 | $ | 668 | $ | 624 | $ | 0.74 |
Three Months Ended March 31, 2021 | |||||||||||||||||||||||||||||
Income Before Income Taxes | Provision For Income Taxes(1) | Net Income Including Noncontrolling Interests | Net Income Attributable To Colgate-Palmolive Company | Diluted Earnings Per Share(2) | |||||||||||||||||||||||||
As Reported GAAP | $ | 957 | $ | 229 | $ | 728 | $ | 681 | $ | 0.80 | |||||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||||
2022 | 2021 | Change | ||||||||||||||||||
Net sales | $ | 926 | $ | 923 | 0.5 | % | ||||||||||||||
Operating profit | $ | 163 | $ | 202 | (19) | % | ||||||||||||||
% of Net sales | 17.6 | % | 21.9 | % | (430) | bps |
Three Months Ended March 31, | ||||||||||||||||||||
2022 | 2021 | Change | ||||||||||||||||||
Net sales | $ | 954 | $ | 907 | 5.5 | % | ||||||||||||||
Operating profit | $ | 265 | $ | 272 | (3) | % | ||||||||||||||
% of Net sales | 27.8 | % | 30.0 | % | (220) | bps |
Three Months Ended March 31, | ||||||||||||||||||||
2022 | 2021 | Change | ||||||||||||||||||
Net sales | $ | 654 | $ | 717 | (9.0) | % | ||||||||||||||
Operating profit | $ | 150 | $ | 180 | (17) | % | ||||||||||||||
% of Net sales | 22.9 | % | 25.1 | % | (220) | bps |
Three Months Ended March 31, | ||||||||||||||||||||
2022 | 2021 | Change | ||||||||||||||||||
Net sales | $ | 726 | $ | 739 | (1.5) | % | ||||||||||||||
Operating profit | $ | 206 | $ | 224 | (8) | % | ||||||||||||||
% of Net sales | 28.4 | % | 30.3 | % | (190) | bps |
Three Months Ended March 31, | ||||||||||||||||||||
2022 | 2021 | Change | ||||||||||||||||||
Net sales | $ | 267 | $ | 272 | (2.0) | % | ||||||||||||||
Operating profit | $ | 44 | $ | 54 | (19) | % | ||||||||||||||
% of Net sales | 16.5 | % | 19.9 | % | (340) | bps |
Three Months Ended March 31, | ||||||||||||||||||||
2022 | 2021 | Change | ||||||||||||||||||
Net sales | $ | 872 | $ | 786 | 11.0 | % | ||||||||||||||
Operating profit | $ | 204 | $ | 215 | (5) | % | ||||||||||||||
% of Net sales | 23.4 | % | 27.4 | % | (400) | bps |
Three Months Ended March 31, | ||||||||||||||||||||
2022 | 2021 | Change | ||||||||||||||||||
Operating profit (loss) | $ | (172) | $ | (143) | 20 | % |
Three Months ended March 31, | ||||||||
2022 | ||||||||
Other (income) expense, net | 63 | |||||||
Non-service related postretirement costs | 19 | |||||||
Total 2022 Global Productivity Initiative charges, pretax | $ | 82 | ||||||
Total 2022 Global Productivity Initiative charges, aftertax | $ | 65 |
Three Months ended March 31, | ||||||||
2022 | ||||||||
North America | 13 | % | ||||||
Latin America | 15 | % | ||||||
Europe | 18 | % | ||||||
Asia Pacific | 11 | % | ||||||
Africa/Eurasia | 4 | % | ||||||
Hill's Pet Nutrition | 9 | % | ||||||
Corporate | 30 | % | ||||||
Total | 100 | % |
Employee-Related Costs | Incremental Depreciation | Asset Impairments | Other | Total | ||||||||||||||||||||||||||||
Charges | $ | 82 | $ | — | $ | — | $ | — | $ | 82 | ||||||||||||||||||||||
Cash Payments | — | — | — | — | — | |||||||||||||||||||||||||||
Charges against assets | (19) | — | — | — | (19) | |||||||||||||||||||||||||||
Foreign exchange | — | — | — | — | — | |||||||||||||||||||||||||||
Balance at March 31, 2022 | $ | 63 | $ | — | $ | — | $ | — | $ | 63 | ||||||||||||||||||||||
Three Months Ended March 31, 2022 | Net Sales Growth (GAAP) | Foreign Exchange Impact | Acquisitions and Divestments Impact | Organic Sales Growth (Non-GAAP) | ||||||||||
Oral, Personal and Home Care | ||||||||||||||
North America | 0.5% | —% | —% | 0.5% | ||||||||||
Latin America | 5.5% | (1.0)% | —% | 6.5% | ||||||||||
Europe | (9.0)% | (6.0)% | —% | (3.0)% | ||||||||||
Asia Pacific | (1.5)% | (2.5)% | —% | 1.0% | ||||||||||
Africa/Eurasia | (2.0)% | (9.5)% | —% | 7.5% | ||||||||||
Total Oral, Personal and Home Care | (1.0)% | (3.0)% | —% | 2.0% | ||||||||||
Pet Nutrition | 11.0% | (2.0)% | —% | 13.0% | ||||||||||
Total Company | 1.5% | (2.5)% | —% | 4.0% |
Month | Total Number of Shares Purchased(1) | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(2) | Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs(3) (in millions) | ||||||||||||||||||||||
January 1 through 31, 2022 | 1,033,829 | $ | 83.26 | 1,013,846 | $ | — | ||||||||||||||||||||
February 1 through 28, 2022 | 1,589,485 | $ | 79.52 | 1,469,800 | $ | — | ||||||||||||||||||||
March 1 through 31, 2022 | 2,764,043 | $ | 75.27 | 2,763,038 | $ | 4,863 | ||||||||||||||||||||
Total | 5,387,357 | $ | 78.06 | 5,246,684 |
Exhibit No. | Description | |||||||
10-A | ||||||||
10-B | ||||||||
31-A | ||||||||
31-B | ||||||||
32 | ||||||||
101 | The following materials from Colgate-Palmolive Company’s Quarterly Report on Form 10-Q for the period ended March 31, 2022, formatted in Inline eXtensible Business Reporting Language (Inline XBRL): (i) the Condensed Consolidated Statements of Income; (ii) the Condensed Consolidated Statements of Comprehensive Income; (iii) the Condensed Consolidated Balance Sheets; (iv) the Condensed Consolidated Statements of Cash Flows; (v) Condensed Consolidated Statements of Changes in Shareholders’ Equity; and (vi) Notes to Condensed Consolidated Financial Statements. | |||||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
COLGATE-PALMOLIVE COMPANY | |||||
(Registrant) | |||||
Principal Executive Officer: | |||||
April 29, 2022 | /s/ Noel R. Wallace | ||||
Noel R. Wallace | |||||
Chairman of the Board, President and Chief Executive Officer | |||||
Principal Financial Officer: | |||||
April 29, 2022 | /s/ Stanley J. Sutula III | ||||
Stanley J. Sutula III | |||||
Chief Financial Officer | |||||
Principal Accounting Officer: | |||||
April 29, 2022 | /s/ Philip G. Shotts | ||||
Philip G. Shotts | |||||
Vice President and Controller |
Date of Grant: | /$GrantDate$/ | ||||
Target Number of PBRSUs: | /$AwardsGranted$/ | ||||
Fair Market Value of Common Stock on Grant Date: | $/$GrantCode6$/ | ||||
Performance Period: | January 1, 2021 through December 31, 2023 | ||||
Vesting Date: | The date the Committee certifies performance of the performance criteria set forth in Exhibit A to the Agreement (the “Certification Date”) | ||||
Settlement Date: | As soon as administratively practicable following the Certification Date, but no later than the earlier of (i) 60 days after the Certification Date and (ii) March 15, 2024. |
Company Relative Net Income Growth | Payout as a % of Target Award | ||||
High | 200% | ||||
75th percentile | 150% | ||||
50th percentile | 100% | ||||
25th percentile | 50% | ||||
Below 25th percentile | 0% |
Company Relative Organic Sales Growth | Payout as a % of Target Award | ||||
High | 200% | ||||
75th percentile | 150% | ||||
50th percentile | 100% | ||||
25th percentile | 50% | ||||
Below 25th percentile | 0% |
Company’s Free Cash Flow Productivity | Payout as a % of Target Award | ||||
110% or above | 200% | ||||
102.5% | 150% | ||||
95% | 100% | ||||
75% | 50% | ||||
Below 75% | 0% |
Company’s TSR Relative to Compensation Peer Group | Award Modifier | ||||
≥75th percentile | +25% | ||||
60th percentile | +15% | ||||
50th percentile | 0 | ||||
40th percentile | -15% | ||||
≤25th percentile | -25% |
Performance Achieved | Award Payout | Weight | % of Target Award Earned | Pre-TSR Modifier Payout | Total Payout (with TSR Modifier) | |||||||||||||||
Relative Net Income Growth | 50th Percentile | 100% of Target Award | 30% | 100% * 30% = 30% | (30% + 75% +10%) 115% of Target Award | 115%*115%= 132.25% of Target Award | ||||||||||||||
Relative Organic Sales Growth | 75th Percentile | 150% of Target Award | 50% | 150% * 50% = 75% | ||||||||||||||||
Free Cash Flow Productivity | 75% | 50% of Target Award | 20% | 50% * 20% = 10% |
Date of Grant: | March 10, 2022 | ||||
Target Number of PBRSUs: | /$AwardsGranted$/ | ||||
Fair Market Value of Common Stock on Grant Date: | $73.84 | ||||
Performance Period: | January 1, 2022 through December 31, 2024 | ||||
Vesting Date: | The date the Committee certifies performance of the performance criteria set forth in Exhibit A to the Agreement (the “Certification Date”) | ||||
Settlement Date: | As soon as administratively practicable following the Certification Date, but no later than the earlier of (i) 60 days after the Certification Date and (ii) March 15, 2025. |
Company Relative Net Income Growth | Payout as a % of Target Award | ||||
High | 200% | ||||
75th percentile | 150% | ||||
50th percentile | 100% | ||||
25th percentile | 50% | ||||
Below 25th percentile | 0% |
Company Relative Organic Sales Growth | Payout as a % of Target Award | ||||
High | 200% | ||||
75th percentile | 150% | ||||
50th percentile | 100% | ||||
25th percentile | 50% | ||||
Below 25th percentile | 0% |
Company’s Free Cash Flow Productivity | Payout as a % of Target Award | ||||
110% or above | 200% | ||||
102.5% | 150% | ||||
95% | 100% | ||||
75% | 50% | ||||
Below 75% | 0% |
Company’s TSR Relative to Compensation Peer Group | Award Modifier | ||||
≥75th percentile | +25% | ||||
60th percentile | +15% | ||||
50th percentile | 0 | ||||
40th percentile | -15% | ||||
≤25th percentile | -25% |
Performance Achieved | Award Payout | Weight | % of Target Award Earned | Pre-TSR Modifier Payout | Total Payout (with TSR Modifier) | |||||||||||||||
Relative Net Income Growth | 50th Percentile | 100% of Target Award | 30% | 100% * 30% = 30% | (30% + 75% +10%) 115% of Target Award | 115%*115%= 132.25% of Target Award | ||||||||||||||
Relative Organic Sales Growth | 75th Percentile | 150% of Target Award | 50% | 150% * 50% = 75% | ||||||||||||||||
Free Cash Flow Productivity | 75% | 50% of Target Award | 20% | 50% * 20% = 10% |
/s/ Noel R. Wallace | ||
Noel R. Wallace | ||
Chairman of the Board, President and Chief Executive Officer |
/s/ Stanley J. Sutula III | ||
Stanley J. Sutula III | ||
Chief Financial Officer |
/s/ Noel R. Wallace | ||
Noel R. Wallace | ||
Chairman of the Board, President and | ||
Chief Executive Officer | ||
/s/ Stanley J. Sutula III | ||
Stanley J. Sutula III | ||
Chief Financial Officer |
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Income Statement [Abstract] | ||
Net sales | $ 4,399 | $ 4,344 |
Cost of sales | 1,827 | 1,707 |
Gross profit | 2,572 | 2,637 |
Selling, general and administrative expenses | 1,641 | 1,605 |
Other (income) expense, net | 71 | 28 |
Operating profit | 860 | 1,004 |
Non-service related postretirement costs | 38 | 18 |
Interest (income) expense, net | 27 | 29 |
Income before income taxes | 795 | 957 |
Provision for income taxes | 192 | 229 |
Net income including noncontrolling interests | 603 | 728 |
Less: Net income attributable to noncontrolling interests | 44 | 47 |
Net income attributable to Colgate-Palmolive Company | $ 559 | $ 681 |
Earnings per common share, basic (in dollars per share) | $ 0.67 | $ 0.80 |
Earnings per common share, diluted (in dollars per share) | $ 0.66 | $ 0.80 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Statement of Comprehensive Income [Abstract] | ||
Net income including noncontrolling interests | $ 603 | $ 728 |
Other comprehensive income (loss), net of tax: | ||
Cumulative translation adjustments | 80 | (158) |
Retirement plans and other retiree benefit adjustments | 14 | 2 |
Gains (losses) on cash flow hedges | 41 | 43 |
Total Other comprehensive income (loss), net of tax | 135 | (113) |
Total Comprehensive income including noncontrolling interests | 738 | 615 |
Less: Net income attributable to noncontrolling interests | 44 | 47 |
Less: Cumulative translation adjustments attributable to noncontrolling interests | (2) | (3) |
Total Comprehensive income attributable to noncontrolling interests | 42 | 44 |
Total Comprehensive income attributable to Colgate-Palmolive Company | $ 696 | $ 571 |
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Current Assets | ||
Allowance for doubtful accounts | $ 80 | $ 78 |
Shareholders’ Equity | ||
Common stock par value (in USD per share) | $ 1 | $ 1 |
Common stock authorized (in shares) | 2,000,000,000 | 2,000,000,000 |
Common stock issued (in shares) | 1,465,706,360 | 1,465,706,360 |
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Millions |
Total |
Common Stock |
Additional Paid-in Capital |
Unearned Compensation |
Treasury Stock |
Retained Earnings |
Accumulated Other Comprehensive Income (Loss) |
[1] | Noncontrolling Interests |
||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Beginning balance at Dec. 31, 2020 | $ 1,466 | $ 2,969 | $ (1) | $ (23,045) | $ 23,699 | $ (4,345) | $ 358 | ||||||
Changes in Shareholders' Equity [Roll Forward] | |||||||||||||
Net income | $ 728 | 681 | 47 | ||||||||||
Other comprehensive income (loss), net of tax | (113) | (110) | (3) | ||||||||||
Dividends | [2] | (756) | 0 | ||||||||||
Stock-based compensation expense | 38 | ||||||||||||
Shares issued for stock options | 13 | 22 | |||||||||||
Shares issued for restricted stock units | (11) | 11 | |||||||||||
Treasury stock acquired | (372) | ||||||||||||
Other | 2 | 1 | (1) | ||||||||||
Ending balance at Mar. 31, 2021 | 1,466 | 3,011 | 0 | (23,384) | 23,624 | (4,455) | 401 | ||||||
Beginning balance at Dec. 31, 2021 | 971 | 1,466 | 3,269 | (1) | (24,089) | 24,350 | (4,386) | 362 | |||||
Changes in Shareholders' Equity [Roll Forward] | |||||||||||||
Net income | 603 | 559 | 44 | ||||||||||
Other comprehensive income (loss), net of tax | 135 | 137 | (2) | ||||||||||
Dividends | [2] | (760) | |||||||||||
Stock-based compensation expense | 29 | ||||||||||||
Shares issued for stock options | 77 | 77 | |||||||||||
Shares issued for restricted stock units | (22) | 22 | |||||||||||
Treasury stock acquired | (410) | ||||||||||||
Other | 2 | 1 | (1) | 1 | 3 | ||||||||
Ending balance at Mar. 31, 2022 | $ 728 | $ 1,466 | $ 3,355 | $ 0 | $ (24,401) | $ 24,149 | $ (4,248) | $ 407 | |||||
|
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) $ in Millions |
3 Months Ended | |||||
---|---|---|---|---|---|---|
Mar. 31, 2022
USD ($)
Dividend
$ / shares
|
Mar. 31, 2021
USD ($)
Dividend
$ / shares
|
Dec. 31, 2021
USD ($)
|
Dec. 31, 2020
USD ($)
|
|||
Statement of Stockholders' Equity [Abstract] | ||||||
Dividends declared per common share (in dollars per share) | $ / shares | [1] | $ 0.92 | $ 0.89 | |||
Accumulated other comprehensive loss, cumulative translation losses | $ 3,269 | $ 3,313 | $ 3,349 | $ 3,158 | ||
Accumulated other comprehensive income (loss), unrecognized retirement plan and other retiree benefit costs | $ 1,030 | $ 1,176 | $ 1,044 | $ 1,178 | ||
Number of dividends declared per quarter | Dividend | 2 | 2 | ||||
|
Basis of Presentation |
3 Months Ended |
---|---|
Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The Condensed Consolidated Financial Statements reflect all normal recurring adjustments which, in management’s opinion, are necessary for a fair statement of the results for interim periods. Results of operations for interim periods may not be representative of results to be expected for a full year. Colgate-Palmolive Company (together with its subsidiaries, the “Company” or “Colgate”) reclassifies certain prior year amounts, as applicable, to conform to the current year presentation. For a complete set of financial statement notes, including the Company’s significant accounting policies, refer to the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, filed with the Securities and Exchange Commission (the “SEC”).
|
Use of Estimates |
3 Months Ended |
---|---|
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates Provisions for certain expenses, including income taxes, advertising and consumer promotion, are based on full year assumptions and are included in the accompanying Condensed Consolidated Financial Statements in proportion with estimated annual tax rates, the passage of time or estimated annual sales, as applicable. |
Recent Accounting Pronouncements |
3 Months Ended |
---|---|
Mar. 31, 2022 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In March 2022, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2022-02, “Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures.” This ASU eliminates the accounting guidance for troubled debt restructurings by creditors while enhancing disclosure requirements for certain loan refinancing and restructurings by creditors made to borrowers experiencing financial difficulty. The amendments also require disclosure of current-period gross write-offs by year of origination for financing receivables. This guidance is effective for the Company beginning on January 1, 2023 and is not expected to have a material impact on the Company’s Consolidated Financial Statements. In March 2022, the FASB issued ASU No. 2022-01, “Derivatives and Hedging (Topic 815): Fair Value Hedging-Portfolio Layer Method.” This ASU clarifies the accounting and promotes consistency in reporting for hedges where the portfolio layer method is applied. This guidance is effective for the Company beginning on January 1, 2023 and is not expected to have an impact on the Company’s Consolidated Financial Statements. In November 2021, the FASB issued ASU No. 2021-10, “Government Assistance (Topic 832).” This ASU requires increased disclosure on an annual basis about transactions with domestic, foreign, local, regional and national governments, including entities related to those governments and intergovernmental organizations, that are accounted for by applying a grant or contribution accounting model by analogy to other accounting guidance. This guidance was effective for the Company beginning on January 1, 2022 and did not have a material impact on the Company’s Consolidated Financial Statements. In October 2021, the FASB issued ASU No. 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers.” This ASU requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASU No. 2016-10, “Revenue from Contracts with Customers (Topic 606).” This guidance is effective for the Company beginning on January 1, 2023 and is not expected to have a material impact on the Company’s Consolidated Financial Statements. In March 2020, the FASB issued ASU No. 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting,” which provides optional expedients and exceptions for applying generally accepted accounting principles (“GAAP”) to contracts, hedging relationships and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. In January 2021, the FASB issued ASU No. 2021-01, “Reference Rate Reform (Topic 848): Scope,” which clarified that certain optional expedients and exceptions in Topic 848 apply to derivatives that are affected by the discounting transition due to reference rate reform. These ASUs were effective upon issuance and can be applied prospectively for contract modifications and hedging relationships through December 31, 2022. The guidance has not had and is not expected to have a material impact on the Company’s Consolidated Financial Statements.
|
Restructuring and Related Implementation Charges |
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Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Implementation Charges | Restructuring and Related Implementation Charges On January 27, 2022, the Company’s Board of Directors (the “Board”) approved a targeted productivity program (the “2022 Global Productivity Initiative”). The program is intended to reallocate resources towards the Company’s strategic priorities and faster growth businesses, drive efficiencies in the Company’s operations and streamline the Company’s supply chain to reduce structural costs. Implementation of the 2022 Global Productivity Initiative, which is expected to be substantially completed by mid-year 2023, is estimated to result in cumulative pretax charges, once all phases are approved and implemented, in the range of $200 to $240 ($170 to $200 aftertax), which is currently estimated to be comprised of the following: employee-related costs, including severance, pension and other termination benefits (75%); asset-related costs, primarily accelerated depreciation and asset write-downs (15%); and other charges (10%), which include contract termination costs, consisting primarily of implementation-related charges resulting directly from exit activities and the implementation of new strategies. It is estimated that approximately 80% to 90% of the charges will result in cash expenditures. It is expected that the cumulative pretax charges, once all projects are approved and implemented, will relate to initiatives undertaken in North America (5%), Latin America (10%), Europe (45%), Asia Pacific (5%), Africa/Eurasia (15%), Hill’s Pet Nutrition (5%) and Corporate (15%). For the three months ended March 31, 2022, charges resulting from the 2022 Global Productivity Initiative are reflected in the income statement as follows:
Restructuring and related implementation charges in the preceding table are recorded in the Corporate segment as these initiatives are predominantly centrally directed and controlled and are not included in internal measures of segment operating performance. Total charges incurred for the 2022 Global Productivity Initiative relate to initiatives undertaken by the following reportable operating segments:
The following table summarizes the activity for the restructuring and related implementation charges discussed above and the related accruals:
|
Inventories |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory, Net, Items Net of Reserve Alternative [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventories | Inventories Inventories by major class were as follows:
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Earnings Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share | Earnings Per Share For the three months ended March 31, 2022 and 2021, earnings per share were as follows:
For the three months ended March 31, 2022 and 2021, the average number of stock options and restricted stock units that were anti-dilutive and not included in diluted earnings per share calculations were 4,107,848 and 2,721,084, respectively.
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Other Comprehensive Income (Loss) |
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Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Comprehensive Income (Loss) | Other Comprehensive Income (Loss) Additions to and reclassifications out of Accumulated other comprehensive income (loss) attributable to the Company for the three months ended March 31, 2022 and 2021 were as follows:
(1) These components of Other comprehensive income (loss) are included in the computation of total pension cost. See Note 8, Retirement Plans and Other Retiree Benefits for additional details. (2) These (gains) losses are reclassified into Cost of sales. See Note 11, Fair Value Measurements and Financial Instruments for additional details. There were no tax impacts on Other comprehensive income (loss) (“OCI”) attributable to Noncontrolling interests.
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Retirement Plans and Other Retiree Benefits |
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement Plans and Other Retiree Benefits | Retirement Plans and Other Retiree Benefits Components of Net periodic benefit cost for the three months ended March 31, 2022 and 2021 were as follows:
Other postretirement charges for the three months ended March 31, 2022 included pension and other charges amounting to $19 incurred pursuant to the 2022 Global Productivity Initiative. For the three months ended March 31, 2022 and 2021, the Company made no voluntary contributions to its U.S. postretirement plans.
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Contingencies |
3 Months Ended |
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Mar. 31, 2022 | |
Loss Contingency [Abstract] | |
Contingencies | Contingencies As a global company serving consumers in more than 200 countries and territories, the Company is routinely subject to a wide variety of legal proceedings. These include disputes relating to intellectual property, contracts, product liability, marketing, advertising, foreign exchange controls, antitrust and trade regulation, as well as labor and employment, pension, data privacy and security, environmental and tax matters and consumer class actions. Management proactively reviews and monitors the Company’s exposure to, and the impact of, environmental matters. The Company is party to various environmental matters and, as such, may be responsible for all or a portion of the cleanup, restoration and post-closure monitoring of several sites. The Company establishes accruals for loss contingencies when it has determined that a loss is probable and that the amount of loss, or range of loss, can be reasonably estimated. Any such accruals are adjusted thereafter as appropriate to reflect changes in circumstances. The Company also determines estimates of reasonably possible losses or ranges of reasonably possible losses in excess of related accrued liabilities, if any, when it has determined that a loss is reasonably possible and it is able to determine such estimates. For those matters disclosed below for which the amount of any potential losses can be reasonably estimated, the Company currently estimates that the aggregate range of reasonably possible losses in excess of any accrued liabilities is $0 to approximately $475 (based on current exchange rates). The estimates included in this amount are based on the Company’s analysis of currently available information and, as new information is obtained, these estimates may change. Due to the inherent subjectivity of the assessments and the unpredictability of outcomes of legal proceedings, any amounts accrued or included in this aggregate range may not represent the ultimate loss to the Company. Thus, the Company’s exposure and ultimate losses may be higher or lower, and possibly significantly so, than the amounts accrued or the range disclosed above. Based on current knowledge, management does not believe that the ultimate resolution of loss contingencies arising from the matters discussed herein will have a material effect on the Company’s consolidated financial position or its ongoing results of operations or cash flows. However, in light of the inherent uncertainties noted above, an adverse outcome in one or more matters could be material to the Company’s results of operations or cash flows for any particular quarter or year. Brazilian Matters There are certain tax and civil proceedings outstanding, as described below, related to the Company’s 1995 acquisition of the Kolynos oral care business from Wyeth (the “Seller”). The Brazilian internal revenue authority has disallowed interest deductions and foreign exchange losses taken by the Company’s Brazilian subsidiary for certain years in connection with the financing of the Kolynos acquisition. The tax assessments with interest, penalties and any court-mandated fees, at the current exchange rate, are approximately $127. This amount includes additional assessments received from the Brazilian internal revenue authority in April 2016 relating to net operating loss carryforwards used by the Company’s Brazilian subsidiary to offset taxable income that had also been deducted from the authority’s original assessments. The Company has been disputing the disallowances by appealing the assessments since October 2001. In each of September 2015, February 2017, June 2018, April 2019 and September 2020, the Company lost an administrative appeal and subsequently filed an appeal in Brazilian federal court. Currently, there are five appeals pending in the Brazilian federal court. Although there can be no assurances, management believes, based on the opinion of its Brazilian legal counsel, that the disallowances are without merit and that the Company should ultimately prevail. The Company is challenging these disallowances vigorously. In July 2002, the Brazilian Federal Public Attorney filed a civil action against the federal government of Brazil, Laboratorios Wyeth-Whitehall Ltda. (the Brazilian subsidiary of the Seller) and the Company, as represented by its Brazilian subsidiary, in the 6th. Lower Federal Court in the City of São Paulo, seeking to annul an April 2000 decision by the Brazilian Board of Tax Appeals that found in favor of the Seller’s Brazilian subsidiary on the issue of whether it had incurred taxable capital gains as a result of the divestiture of Kolynos. The action seeks to make the Company’s Brazilian subsidiary jointly and severally liable for any tax due from the Seller’s Brazilian subsidiary. The case has been pending since 2002, and the Lower Federal Court has not issued a decision. Although there can be no assurances, management believes, based on the opinion of its Brazilian legal counsel, that the Company should ultimately prevail in this action. The Company is challenging this action vigorously. In December 2005, the Brazilian internal revenue authority issued to the Company’s Brazilian subsidiary a tax assessment with interest, penalties and any court-mandated fees of approximately $56, at the current exchange rate, based on a claim that certain purchases of U.S. Treasury bills by the subsidiary and their subsequent disposition during the period 2000 to 2001 were subject to a tax on foreign exchange transactions. The Company had been disputing the assessment within the internal revenue authority’s administrative appeals process. However, in November 2015, the Superior Chamber of Administrative Tax Appeals denied the Company’s final administrative appeal, and the Company has filed a lawsuit in the Brazilian federal court. In the event the Company is unsuccessful in this lawsuit, further appeals are available within the Brazilian federal courts. Although there can be no assurances, management believes, based on the opinion of its Brazilian legal counsel, that the tax assessment is without merit and that the Company should ultimately prevail. The Company is challenging this assessment vigorously. Competition Matter Certain of the Company’s subsidiaries were historically subject to actions and, in some cases, fines, by governmental authorities in a number of countries related to alleged competition law violations. Substantially all of these matters also involved other consumer goods companies and/or retail customers. The Company’s policy is to comply with antitrust and competition laws and, if a violation of any such laws is found, to take appropriate remedial action and to cooperate fully with any related governmental inquiry. The status as of March 31, 2022 of such competition law matters pending against the Company during the three months ended March 31, 2022 is set forth below. ▪In July 2014, the Greek competition law authority issued a statement of objections alleging a restriction of parallel imports into Greece. The Company responded to this statement of objections. In July 2017, the Company received the decision from the Greek competition law authority in which the Company was fined $11. The Company appealed the decision to the Greek courts. In April 2019, the Greek courts affirmed the judgment against the Company’s Greek subsidiary, but reduced the fine to $10.5 and dismissed the case against Colgate-Palmolive Company. The Company’s Greek subsidiary and the Greek competition authority have appealed the decision to the Greek Supreme Court. Talcum Powder Matters The Company has been named as a defendant in civil actions alleging that certain talcum powder products that were sold prior to 1996 were contaminated with asbestos and/or caused mesothelioma and other cancers. Many of these actions involve a number of co-defendants from a variety of different industries, including suppliers of asbestos and manufacturers of products that, unlike the Company’s products, were designed to contain asbestos. As of March 31, 2022, there were 186 individual cases pending against the Company in state and federal courts throughout the United States, as compared to 171 cases as of December 31, 2021. During the three months ended March 31, 2022, 17 new cases were filed and two cases were resolved by voluntary dismissal. There were no settlements of pending cases in the three months ended March 31, 2022. A significant portion of the Company’s costs incurred in defending and resolving these claims has been, and the Company believes that a portion of such costs will continue to be, covered by insurance policies issued by several primary, excess and umbrella insurance carriers, subject to deductibles, exclusions, retentions, policy limits and insurance carrier insolvencies. While the Company and its legal counsel believe that these cases are without merit and intend to challenge them vigorously, there can be no assurances regarding the ultimate resolution of these matters. ERISA Matter In June 2016, a putative class action claiming that residual annuity payments made to certain participants in the Colgate-Palmolive Company Employees’ Retirement Income Plan (the “Plan”) did not comply with the Employee Retirement Income Security Act was filed against the Plan, the Company and certain individuals (the “Company Defendants”) in the United States District Court for the Southern District of New York (the “Court”). The relief sought includes recalculation of benefits, pre- and post-judgment interest and attorneys’ fees. This action was certified as a class action in July 2017. In July 2020, the Court granted in part and denied in part the Company Defendants’ motion for summary judgment and dismissed certain claims on consent of the parties. In August 2020, the Court granted the plaintiffs’ motion for summary judgment on the remaining claims. The Company and the Plan are contesting this action vigorously and, in September 2020, appealed to the United States Court of Appeals for the Second Circuit. The appeal is currently pending.
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Segment Information |
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Segment Information | Segment Information The Company operates in two product segments: Oral, Personal and Home Care; and Pet Nutrition. The operations of the Oral, Personal and Home Care product segment are managed geographically in five reportable operating segments: North America, Latin America, Europe, Asia Pacific and Africa/Eurasia. The Company evaluates segment performance based on several factors, including Operating profit. The Company uses Operating profit as a measure of operating segment performance because it excludes the impact of Corporate-driven decisions related to interest expense and income taxes. The accounting policies of the operating segments are generally the same as those described in Note 2, Summary of Significant Accounting Policies to the Company’s Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. Intercompany sales have been eliminated. Corporate operations include costs related to stock options and restricted stock units, research and development costs, Corporate overhead costs, restructuring and related implementation charges and gains and losses on sales of non-core product lines and assets. The Company reports these items within Corporate operations as they relate to Corporate-based responsibilities and decisions and are not included in the internal measures of segment operating performance used by the Company to measure the underlying performance of the operating segments. Net sales by segment were as follows:
Approximately 70% of the Company’s Net sales are generated from markets outside the U.S., with approximately 45% of the Company’s Net sales coming from emerging markets (which consist of Latin America, Asia (excluding Japan), Africa/Eurasia and Central Europe). The Company’s Net sales of Oral, Personal and Home Care and Pet Nutrition products accounted for the following percentages of the Company’s Net sales:
Operating profit by segment was as follows:
Corporate Operating profit (loss) for the three months ended March 31, 2022 included charges resulting from the 2022 Global Productivity Initiative of $63.
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Fair Value Measurements and Financial Instruments |
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements and Financial Instruments | Fair Value Measurements and Financial Instruments The Company uses available market information and other valuation methodologies in assessing the fair value of financial instruments. Judgment is required in interpreting market data to develop the estimates of fair value and, accordingly, changes in assumptions or the estimation methodologies may affect the fair value estimates. The Company is exposed to the risk of credit loss in the event of nonperformance by counterparties to financial instrument contracts; however, nonperformance is considered unlikely and any nonperformance is unlikely to be material, as it is the Company’s policy to contract only with diverse, credit-worthy counterparties based upon both strong credit ratings and other credit considerations. The Company is exposed to market risk from foreign currency exchange rates, interest rates and commodity price fluctuations. Volatility relating to these exposures is managed on a global basis by utilizing a number of techniques, including working capital management, sourcing strategies, selling price increases, selective borrowings in local currencies and entering into selective derivative instrument transactions, issued with standard features, in accordance with the Company’s treasury and risk management policies, which prohibit the use of derivatives for speculative purposes and leveraged derivatives for any purpose. It is the Company’s policy to enter into derivative instrument contracts with terms that match the underlying exposure being hedged. The Company’s derivative instruments include interest rate swap contracts, forward-starting interest rate swaps, foreign currency contracts and commodity contracts. The Company utilizes interest rate swap contracts to manage its targeted mix of fixed and floating rate debt, and these swaps are valued using observable benchmark rates (Level 2 valuation). The Company utilizes forward-starting interest rate swaps to mitigate the risk of variability in interest rate for future debt issuances and these swaps are valued using observable benchmark rates (Level 2 valuation). The Company utilizes foreign currency contracts, including forward and swap contracts, option contracts, local currency deposits and local currency borrowings to hedge portions of its foreign currency purchases, assets and liabilities arising in the normal course of business and the net investment in certain foreign subsidiaries. These contracts are valued using observable market rates (Level 2 valuation). Commodity futures contracts are utilized to hedge the purchases of raw materials used in production. These contracts are measured using quoted commodity exchange prices (Level 1 valuation). The duration of foreign currency and commodity contracts generally does not exceed 12 months. The following table summarizes the fair value of the Company’s derivative instruments and other financial instruments which are carried at fair value in the Company’s Condensed Consolidated Balance Sheets at March 31, 2022 and December 31, 2021:
The carrying amount of cash, cash equivalents, marketable securities, accounts receivable and short-term debt approximated fair value as of March 31, 2022 and December 31, 2021. The estimated fair value of the Company’s long-term debt, including the current portion, as of March 31, 2022 and December 31, 2021, was $7,645 and $7,651, respectively, and the related carrying value was $7,600 and $7,206, respectively. The estimated fair value of long-term debt was derived principally from quoted prices on the Company’s outstanding fixed-term notes (Level 2 valuation). The following amounts were recorded on the Condensed Consolidated Balance Sheet related to the cumulative basis adjustment for fair value hedges as of:
The following tables present the notional values as of:
The following tables present the location and amount of gains (losses) recognized on the Company’s Condensed Consolidated Statements of Income:
The following table presents the location and amount of unrealized gains (losses) included in OCI:
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Use of Estimates (Policies) |
3 Months Ended |
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Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates Provisions for certain expenses, including income taxes, advertising and consumer promotion, are based on full year assumptions and are included in the accompanying Condensed Consolidated Financial Statements in proportion with estimated annual tax rates, the passage of time or estimated annual sales, as applicable. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In March 2022, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2022-02, “Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures.” This ASU eliminates the accounting guidance for troubled debt restructurings by creditors while enhancing disclosure requirements for certain loan refinancing and restructurings by creditors made to borrowers experiencing financial difficulty. The amendments also require disclosure of current-period gross write-offs by year of origination for financing receivables. This guidance is effective for the Company beginning on January 1, 2023 and is not expected to have a material impact on the Company’s Consolidated Financial Statements. In March 2022, the FASB issued ASU No. 2022-01, “Derivatives and Hedging (Topic 815): Fair Value Hedging-Portfolio Layer Method.” This ASU clarifies the accounting and promotes consistency in reporting for hedges where the portfolio layer method is applied. This guidance is effective for the Company beginning on January 1, 2023 and is not expected to have an impact on the Company’s Consolidated Financial Statements. In November 2021, the FASB issued ASU No. 2021-10, “Government Assistance (Topic 832).” This ASU requires increased disclosure on an annual basis about transactions with domestic, foreign, local, regional and national governments, including entities related to those governments and intergovernmental organizations, that are accounted for by applying a grant or contribution accounting model by analogy to other accounting guidance. This guidance was effective for the Company beginning on January 1, 2022 and did not have a material impact on the Company’s Consolidated Financial Statements. In October 2021, the FASB issued ASU No. 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers.” This ASU requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASU No. 2016-10, “Revenue from Contracts with Customers (Topic 606).” This guidance is effective for the Company beginning on January 1, 2023 and is not expected to have a material impact on the Company’s Consolidated Financial Statements. In March 2020, the FASB issued ASU No. 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting,” which provides optional expedients and exceptions for applying generally accepted accounting principles (“GAAP”) to contracts, hedging relationships and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. In January 2021, the FASB issued ASU No. 2021-01, “Reference Rate Reform (Topic 848): Scope,” which clarified that certain optional expedients and exceptions in Topic 848 apply to derivatives that are affected by the discounting transition due to reference rate reform. These ASUs were effective upon issuance and can be applied prospectively for contract modifications and hedging relationships through December 31, 2022. The guidance has not had and is not expected to have a material impact on the Company’s Consolidated Financial Statements.
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Restructuring and Related Implementation Charges (Tables) |
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Restructuring and Related Activities [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restructuring and Related Costs | For the three months ended March 31, 2022, charges resulting from the 2022 Global Productivity Initiative are reflected in the income statement as follows:
The following table summarizes the activity for the restructuring and related implementation charges discussed above and the related accruals:
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Schedule of Percent of Total Restructuring Charges Related To Segment for the period | Total charges incurred for the 2022 Global Productivity Initiative relate to initiatives undertaken by the following reportable operating segments:
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Inventories (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Inventory, Net, Items Net of Reserve Alternative [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventories by Major Class | Inventories by major class were as follows:
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Earnings Per Share (Tables) |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | For the three months ended March 31, 2022 and 2021, earnings per share were as follows:
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Other Comprehensive Income (Loss) (Tables) |
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Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Comprehensive Income (Loss) | Additions to and reclassifications out of Accumulated other comprehensive income (loss) attributable to the Company for the three months ended March 31, 2022 and 2021 were as follows:
(1) These components of Other comprehensive income (loss) are included in the computation of total pension cost. See Note 8, Retirement Plans and Other Retiree Benefits for additional details. (2) These (gains) losses are reclassified into Cost of sales. See Note 11, Fair Value Measurements and Financial Instruments for additional details.
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Retirement Plans and Other Retiree Benefits (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components Of Net Periodic Benefit Cost | Components of Net periodic benefit cost for the three months ended March 31, 2022 and 2021 were as follows:
|
Segment Information (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Sales and Operating Profit by Segment | Net sales by segment were as follows:
The Company’s Net sales of Oral, Personal and Home Care and Pet Nutrition products accounted for the following percentages of the Company’s Net sales:
Operating profit by segment was as follows:
|
Fair Value Measurements and Financial Instruments (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of derivative instruments | The following table summarizes the fair value of the Company’s derivative instruments and other financial instruments which are carried at fair value in the Company’s Condensed Consolidated Balance Sheets at March 31, 2022 and December 31, 2021:
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Schedule of hedged item and cumulative adjustment to carrying amount | The following amounts were recorded on the Condensed Consolidated Balance Sheet related to the cumulative basis adjustment for fair value hedges as of:
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Schedule of notional values | The following tables present the notional values as of:
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Schedule of gains (losses) recognized in Statements of Income | The following tables present the location and amount of gains (losses) recognized on the Company’s Condensed Consolidated Statements of Income:
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Schedule of gains (losses) included in Other Comprehensive Income | The following table presents the location and amount of unrealized gains (losses) included in OCI:
|
Restructuring and Related Implementation Charges - Summary of Restructuring and Related Costs (Details) - Global Productivity Initiative $ in Millions |
3 Months Ended |
---|---|
Mar. 31, 2022
USD ($)
| |
Restructuring Cost and Reserve [Line Items] | |
Total 2022 Global Productivity Initiative charges, pretax | $ 82 |
Total 2022 Global Productivity Initiative charges, aftertax | 65 |
Other (income) expense, net | |
Restructuring Cost and Reserve [Line Items] | |
Total 2022 Global Productivity Initiative charges, pretax | 63 |
Non-service related postretirement costs | |
Restructuring Cost and Reserve [Line Items] | |
Total 2022 Global Productivity Initiative charges, pretax | $ 19 |
Restructuring and Related Implementation Charges - Restructuring Activity and Related Accruals (Details) - Global Productivity Initiative $ in Millions |
3 Months Ended |
---|---|
Mar. 31, 2022
USD ($)
| |
Restructuring Cost and Reserve [Line Items] | |
Charges | $ 82 |
Cash payments | 0 |
Charges against assets | 19 |
Foreign exchange | 0 |
Balance at March 31, 2022 | 63 |
Employee-Related Costs | |
Restructuring Cost and Reserve [Line Items] | |
Charges | 82 |
Cash payments | 0 |
Charges against assets | 19 |
Foreign exchange | 0 |
Balance at March 31, 2022 | 63 |
Incremental Depreciation | |
Restructuring Cost and Reserve [Line Items] | |
Charges | 0 |
Cash payments | 0 |
Charges against assets | 0 |
Foreign exchange | 0 |
Balance at March 31, 2022 | 0 |
Asset Impairments | |
Restructuring Cost and Reserve [Line Items] | |
Charges | 0 |
Cash payments | 0 |
Charges against assets | 0 |
Foreign exchange | 0 |
Balance at March 31, 2022 | 0 |
Other | |
Restructuring Cost and Reserve [Line Items] | |
Charges | 0 |
Cash payments | 0 |
Charges against assets | 0 |
Foreign exchange | 0 |
Balance at March 31, 2022 | $ 0 |
Inventories (Details) - USD ($) $ in Millions |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Inventory, Net, Items Net of Reserve Alternative [Abstract] | ||
Raw materials and supplies | $ 550 | $ 505 |
Work-in-process | 50 | 39 |
Finished goods | 1,451 | 1,248 |
Total Inventories, net | 2,051 | 1,792 |
Non-current inventory, net | (127) | (100) |
Current Inventories, net | $ 1,924 | $ 1,692 |
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Net income attributable to Colgate-Palmolive Company | ||
Basic EPS | $ 559 | $ 681 |
Diluted EPS | $ 559 | $ 681 |
Shares (millions) | ||
Basic EPS (in shares) | 840,600,000 | 848,600,000 |
Stock options and restricted stock units (in shares) | 3,100,000 | 2,800,000 |
Diluted EPS (in shares) | 843,700,000 | 851,400,000 |
Per Share | ||
Basic EPS (in dollars per share) | $ 0.67 | $ 0.80 |
Diluted EPS (in dollars per share) | $ 0.66 | $ 0.80 |
Antidilutive securities excluded from computation of earnings per share (in shares) | 4,107,848 | 2,721,084 |
Retirement Plans and Other Retiree Benefits (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Employee-Related Costs | Global Productivity Initiative | ||
Components of net periodic benefit cost | ||
Other postretirement charges | $ 19 | |
Other Retiree Benefits | ||
Components of net periodic benefit cost | ||
Service cost | 5 | $ 6 |
Interest cost | 10 | 9 |
Expected return on plan assets | 0 | 0 |
Amortization of actuarial loss (gain) | 5 | 6 |
Net periodic benefit cost | 20 | 21 |
Other postretirement charges | 8 | 0 |
Total pension cost | 28 | 21 |
United States | Pension Benefits | ||
Components of net periodic benefit cost | ||
Service cost | 0 | 0 |
Interest cost | 16 | 15 |
Expected return on plan assets | (25) | (27) |
Amortization of actuarial loss (gain) | 11 | 13 |
Net periodic benefit cost | 2 | 1 |
Other postretirement charges | 9 | 0 |
Total pension cost | 11 | 1 |
Voluntary benefit plan contribution | 0 | 0 |
International | Pension Benefits | ||
Components of net periodic benefit cost | ||
Service cost | 5 | 4 |
Interest cost | 6 | 5 |
Expected return on plan assets | (6) | (6) |
Amortization of actuarial loss (gain) | 2 | 3 |
Net periodic benefit cost | 7 | 6 |
Other postretirement charges | 2 | 0 |
Total pension cost | $ 9 | $ 6 |
Contingencies (Details) $ in Millions |
1 Months Ended | 3 Months Ended | |||
---|---|---|---|---|---|
Apr. 30, 2019
USD ($)
|
Mar. 31, 2022
USD ($)
case
country_and_territory
|
Dec. 31, 2021
case
|
Jul. 31, 2017
USD ($)
|
Dec. 31, 2005
USD ($)
|
|
Loss Contingencies [Line Items] | |||||
Number of countries in which entity operates (more than) | country_and_territory | 200 | ||||
Brazilian internal revenue authority, matter 1 | $ 127.0 | ||||
Loss contingency, number of cases on appeal | case | 5 | ||||
Brazilian internal revenue authority, matter 2 | $ 56.0 | ||||
Fine imposed by Greek competition authority | $ 11.0 | ||||
Increase (decrease) in fine imposed by Greek competition authority | $ 10.5 | ||||
Loss contingency, pending claims, number (in cases) | case | 186 | 171 | |||
Loss contingency, new claims filed, number (in cases) | case | 17 | ||||
Loss contingency, claims dismissed or settled, number (in cases) | case | 2 | ||||
Minimum | |||||
Loss Contingencies [Line Items] | |||||
Range of reasonably possible losses | $ 0.0 | ||||
Maximum | |||||
Loss Contingencies [Line Items] | |||||
Range of reasonably possible losses | $ 475.0 |
Segment Information - Narrative (Details) $ in Millions |
3 Months Ended |
---|---|
Mar. 31, 2022
USD ($)
segment
| |
Segment Reporting Information [Line Items] | |
Number of product segments (in segments) | 2 |
Number of reportable segments (in segments) | 5 |
Number of operating segments (in segments) | 5 |
Corporate | Included in Operating profit (loss) | Global Productivity Initiative | |
Segment Reporting Information [Line Items] | |
Acquisition related costs | $ | $ 63 |
Net Sales | |
Segment Reporting Information [Line Items] | |
Percentage of consolidated Net sales represented by sales outside US | 70.00% |
Percentage of consolidated Net sales coming from emerging markets | 45.00% |
Segment Information - Schedule of Segment Information (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Segment Reporting Information [Line Items] | ||
Total Net sales | $ 4,399 | $ 4,344 |
Operating profit (loss) | $ 860 | $ 1,004 |
Product Concentration Risk | Net Sales | ||
Segment Reporting Information [Line Items] | ||
Percent of net sales | 100.00% | 100.00% |
Product Concentration Risk | Net Sales | Oral Care | ||
Segment Reporting Information [Line Items] | ||
Percent of net sales | 45.00% | 45.00% |
Product Concentration Risk | Net Sales | Personal Care | ||
Segment Reporting Information [Line Items] | ||
Percent of net sales | 18.00% | 19.00% |
Product Concentration Risk | Net Sales | Home Care | ||
Segment Reporting Information [Line Items] | ||
Percent of net sales | 17.00% | 18.00% |
Product Concentration Risk | Net Sales | Pet Nutrition | ||
Segment Reporting Information [Line Items] | ||
Percent of net sales | 20.00% | 18.00% |
Operating Segments | Oral, Personal and Home Care | ||
Segment Reporting Information [Line Items] | ||
Total Net sales | $ 3,527 | $ 3,558 |
Operating profit (loss) | 828 | 932 |
Operating Segments | Pet Nutrition | ||
Segment Reporting Information [Line Items] | ||
Total Net sales | 872 | 786 |
Operating profit (loss) | 204 | 215 |
Operating Segments | North America | Oral, Personal and Home Care | ||
Segment Reporting Information [Line Items] | ||
Total Net sales | 926 | 923 |
Operating profit (loss) | 163 | 202 |
Operating Segments | Latin America | Oral, Personal and Home Care | ||
Segment Reporting Information [Line Items] | ||
Total Net sales | 954 | 907 |
Operating profit (loss) | 265 | 272 |
Operating Segments | Europe | Oral, Personal and Home Care | ||
Segment Reporting Information [Line Items] | ||
Total Net sales | 654 | 717 |
Operating profit (loss) | 150 | 180 |
Operating Segments | Asia Pacific | Oral, Personal and Home Care | ||
Segment Reporting Information [Line Items] | ||
Total Net sales | 726 | 739 |
Operating profit (loss) | 206 | 224 |
Operating Segments | Africa/Eurasia | Oral, Personal and Home Care | ||
Segment Reporting Information [Line Items] | ||
Total Net sales | 267 | 272 |
Operating profit (loss) | 44 | 54 |
Corporate | ||
Segment Reporting Information [Line Items] | ||
Operating profit (loss) | $ (172) | $ (143) |
Fair Value Measurements and Financial Instruments - Fair Value of Derivative Instruments and Other Financial Instruments (Details) - USD ($) $ in Millions |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Designated derivative instruments | ||
Derivative assets | $ 77 | $ 49 |
Derivative liabilities | 20 | 27 |
Other financial instruments | ||
Total other financial instruments | 58 | 34 |
Other current assets | ||
Other financial instruments | ||
Marketable securities | 58 | 34 |
Other current assets | Interest rate swap contracts | ||
Designated derivative instruments | ||
Derivative assets | 1 | 5 |
Other current assets | Forward-starting interest rate swaps | ||
Designated derivative instruments | ||
Derivative assets | 6 | 0 |
Other current assets | Foreign currency contracts | ||
Designated derivative instruments | ||
Derivative assets | 15 | 22 |
Other current assets | Commodity contracts | ||
Designated derivative instruments | ||
Derivative assets | 5 | 2 |
Other assets | Forward-starting interest rate swaps | ||
Designated derivative instruments | ||
Derivative assets | 50 | 20 |
Other accruals | Interest rate swap contracts | ||
Designated derivative instruments | ||
Derivative liabilities | 0 | 0 |
Other accruals | Forward-starting interest rate swaps | ||
Designated derivative instruments | ||
Derivative liabilities | 0 | 0 |
Other accruals | Foreign currency contracts | ||
Designated derivative instruments | ||
Derivative liabilities | 20 | 6 |
Other accruals | Commodity contracts | ||
Designated derivative instruments | ||
Derivative liabilities | 0 | 0 |
Other liabilities | Forward-starting interest rate swaps | ||
Designated derivative instruments | ||
Derivative liabilities | $ 0 | $ 21 |
Fair Value Measurements and Financial Instruments - Narrative (Details) - USD ($) $ in Millions |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Carrying Value | ||
Debt Instrument [Line Items] | ||
Carrying value of long-term debt | $ 7,600 | $ 7,206 |
Fair Value, Inputs, Level 2 | ||
Debt Instrument [Line Items] | ||
Estimated fair value of long-term debt | $ 7,645 | $ 7,651 |
Fair Value Measurements and Financial Instruments - Carrying Value and Estimated Fair Value of Long-term Debt (Details) - Long-term Debt - USD ($) $ in Millions |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Debt Instrument [Line Items] | ||
Carrying amount of hedged item | $ 401 | $ 405 |
Cumulative hedging adjustment included in the carrying amount | $ 1 | $ 5 |
Fair Value Measurements and Financial Instruments - Schedule of Notional Values (Details) - USD ($) $ in Millions |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Fair Value Hedges | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | $ 937 | $ 966 |
Fair Value Hedges | Foreign Currency Contracts | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | 537 | 566 |
Fair Value Hedges | Foreign Currency Debt | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | 0 | 0 |
Fair Value Hedges | Interest Rate Swaps | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | 400 | 400 |
Fair Value Hedges | Forward-starting interest rate swaps | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | 0 | 0 |
Fair Value Hedges | Commodity Contracts | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | 0 | 0 |
Cash Flow Hedges | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | 1,796 | 1,597 |
Cash Flow Hedges | Foreign Currency Contracts | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | 896 | 873 |
Cash Flow Hedges | Foreign Currency Debt | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | 0 | 0 |
Cash Flow Hedges | Interest Rate Swaps | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | 0 | 0 |
Cash Flow Hedges | Forward-starting interest rate swaps | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | 875 | 700 |
Cash Flow Hedges | Commodity Contracts | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | 25 | 24 |
Net Investment Hedges | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | 4,802 | 4,773 |
Net Investment Hedges | Foreign Currency Contracts | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | 267 | 173 |
Net Investment Hedges | Foreign Currency Debt | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | 4,535 | 4,600 |
Net Investment Hedges | Interest Rate Swaps | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | 0 | 0 |
Net Investment Hedges | Forward-starting interest rate swaps | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | 0 | 0 |
Net Investment Hedges | Commodity Contracts | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional values | $ 0 | $ 0 |
Fair Value Measurements and Financial Instruments - Schedule of Gain (Loss) on Hedges Recognized in Income (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Cost of sales | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Total gain (loss) on hedges recognized in income | $ 5 | $ (3) |
Cost of sales | Interest Rate Swaps | Fair Value Hedges | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) on derivative instrument | 0 | 0 |
Gain (loss) on hedged items | 0 | 0 |
Cost of sales | Foreign Currency Contracts | Fair Value Hedges | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) on derivative instrument | 0 | 0 |
Gain (loss) on hedged items | 0 | 0 |
Cost of sales | Foreign Currency Contracts | Cash Flow Hedges | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount reclassified from OCI | 2 | (6) |
Cost of sales | Commodity contracts | Cash Flow Hedges | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount reclassified from OCI | 3 | 3 |
Selling, general and administrative expenses | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Total gain (loss) on hedges recognized in income | 0 | 0 |
Selling, general and administrative expenses | Interest Rate Swaps | Fair Value Hedges | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) on derivative instrument | 0 | 0 |
Gain (loss) on hedged items | 0 | 0 |
Selling, general and administrative expenses | Foreign Currency Contracts | Fair Value Hedges | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) on derivative instrument | 2 | 0 |
Gain (loss) on hedged items | (2) | 0 |
Selling, general and administrative expenses | Foreign Currency Contracts | Cash Flow Hedges | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount reclassified from OCI | 0 | 0 |
Selling, general and administrative expenses | Commodity contracts | Cash Flow Hedges | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount reclassified from OCI | 0 | 0 |
Interest (income) expense, net | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Total gain (loss) on hedges recognized in income | 0 | 0 |
Interest (income) expense, net | Interest Rate Swaps | Fair Value Hedges | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) on derivative instrument | 4 | 2 |
Gain (loss) on hedged items | (4) | (2) |
Interest (income) expense, net | Foreign Currency Contracts | Fair Value Hedges | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) on derivative instrument | 0 | 0 |
Gain (loss) on hedged items | 0 | 0 |
Interest (income) expense, net | Foreign Currency Contracts | Cash Flow Hedges | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount reclassified from OCI | 0 | 0 |
Interest (income) expense, net | Commodity contracts | Cash Flow Hedges | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount reclassified from OCI | $ 0 | $ 0 |
Fair Value Measurements and Financial Instruments - Schedule of Gain (Loss) Included in OCI (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Cash flow hedges [Abstract] | ||
Gain (loss) recognized in OCI | $ 58 | $ 53 |
Foreign Currency Contracts | ||
Cash flow hedges [Abstract] | ||
Gain (loss) recognized in OCI | (6) | 6 |
Net investment hedges [Abstract] | ||
Gain (loss) on instruments | (6) | 23 |
Gain (loss) on hedged items | 6 | (23) |
Forward-starting interest rate swaps | ||
Cash flow hedges [Abstract] | ||
Gain (loss) recognized in OCI | 57 | 46 |
Commodity Contracts | ||
Cash flow hedges [Abstract] | ||
Gain (loss) recognized in OCI | 7 | 1 |
Foreign Currency Debt | ||
Net investment hedges [Abstract] | ||
Gain (loss) on instruments | 64 | 211 |
Gain (loss) on hedged items | $ (64) | $ (211) |
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