AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-2: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 6/6 · 18/10/2026
Moat50
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
structural advantage · 3/4 · Reported global oral-care leadership, protected brands and extensive distribution, corroborated by Latin American price and volume growth, support a demonstrated brand advantage. Relative costs and portfolio-wide superiority are not established.
durability · 2/4 · Continuing trademark protection and established market access support persistence, but materially slower organic growth and realized retailer concessions make economic durability mixed. No long-term market-share series demonstrates exceptional resilience.
customer dependency · 1/4 · Brand preference supports demand, but lower-priced substitutes and stronger retailer bargaining positions indicate weak customer dependence. No contractual lock-in or material consumer switching friction is demonstrated.
erosion resilience · 2/4 · Latin American price and volume growth and broadly stable adjusted second-quarter operating margin counterbalance slower 2025 growth, retailer concessions and portfolio impairments. Digital entry is an erosion risk, rather than proof of realized share loss.
Pricing power50
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
realized pricing · 3/4 · Latin America achieved 2.8% net selling-price growth with 2.6% volume growth in second-quarter 2026; Hill’s achieved 3.0% pricing in 2025. These are demonstrated outcomes, although Hill’s volume declined and the evidence is not portfolio-wide.
retention · 2/4 · Indirect demand evidence is mixed: Latin American volume grew alongside pricing, while Hill’s total volume declined 0.6% despite a 1.1% acquisition contribution. Lower private-label sales explain part of Hill’s weakness, so this is not a measured branded-customer retention rate.
margin resilience · 2/4 · First-quarter 2026 pricing and productivity savings did not fully offset material-cost inflation. Second-quarter adjusted operating margin improved 10 basis points, while GAAP margin declined 210 basis points. Resilience reflects both pricing and cost actions, with restructuring costs material.
contractual freedom · 1/4 · Actual price increases demonstrate some practical discretion, but stronger retailers have demanded discounts, allowances and fees that reduced sales or profitability. This is adverse evidence of constrained commercial freedom; detailed pricing-contract rights remain unavailable.
Predictability100
Five consecutive annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 100.00
- Revenue growth volatility (pp)
- 2.57
- Positive FCF years (%)
- 100.00
- FCF margin volatility (pp)
- 2.71
Financial strength62
Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, or reported pretax profit plus reported interest expense when operating income is unavailable. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 82.89
- netDebtEbitGrade
- 59.48
- interestCoverageGrade
- 100.00
- currentRatioGrade
- 6.65
- Debt / FCF (x)
- 2.20
- Net debt / operating income (x)
- 2.03
- Interest coverage (x)
- 12.38
- Current ratio (x)
- 0.83
Capital allocation100
Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income or, if unavailable, EBIT calculated from reported pretax profit plus reported interest expense; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. Nonpositive invested capital has no defined return and remains unavailable. Does not establish acquisition quality or buyback timing.
- 3-year pre-tax operating return (%)
- 49.08
- 3-year average dilution (%)
- -1.12
- 3-year average SBC / revenue (%)
- 0.69
- cashConversionGrade
- 100.00
Management56
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Operating cash flow rose from $3.745 billion in 2023 to $4.198 billion in 2025, with controlled capital spending. First-half 2026 cash flow after capital expenditures approximately matched dividends and repurchases. However, $919 million of 2025 impairments and increased restructuring commitments temper the record; projected savings are not delivered returns.
incentive alignment · 3/4 · Existing variable-pay arrangements, clawbacks, hedging restrictions and adopted share-retention requirements support alignment. Annual incentive payments actually declined with weaker 2025 results. Actual executive ownership balances and complete payout calculations are absent, limiting confidence beyond this grade.
execution · 2/4 · Execution is assessed from operating evidence: multi-year cash generation, Latin American price and volume growth and stable adjusted second-quarter margin are positive. Slower organic growth, impairments and substantial restructuring charges make the overall outcome mixed.
governance · 2/4 · Independent committees, reported board attendance and adopted shareholder-rights enhancements provide concrete safeguards. The combined chairman and CEO position and adverse ERISA decisions culminating in a $332 million settlement temper the assessment. Proxy-date practices do not establish subsequent election outcomes or exceptional governance effectiveness.
Evidence
We are a leader in Oral Care with global leadership in the toothpaste and manual toothbrush categories according to market share data.
Business: oral-care category leadership · Filed 23/02/2026
Our products are marketed in over 200 countries and territories throughout the world.
Business: geographic marketing footprint · Filed 23/02/2026
1 Distribution; Raw Materials; Competition; Trademarks and Patents Our Oral, Personal and Home Care products are sold to a variety of retailers, wholesalers and distributors worldwide.
Business: distribution channels · Filed 23/02/2026
Principal global and regional trademarks include Colgate, Palmolive, Darlie, elmex, hello, meridol, Sorriso, Tom’s of Maine, EltaMD, Filorga, Irish Spring, Lady Speed Stick, PCA SKIN, Protex, Sanex, Softsoap, Speed Stick, Ajax, Axion, Fabuloso, Murphy, Soupline and Suavitel, as well as Hill’s Science Diet and Hill’s Prescription Diet.
Business: principal global and regional trademarks · Filed 13/02/2025
Our rights in these trademarks endure for as long as they are used and/or registered.
Business: duration of trademark rights · Filed 13/02/2025
35 COLGATE-PALMOLIVE COMPANY Management’s Discussion and Analysis of Financial Condition and Results of Operations (Dollars in Millions Except Per Share Amounts) Latin America Three Months Ended June 30, 2026 2025 Change Net sales $ 1,372 $ 1,207 13.7 % Operating profit $ 418 $ 367 14 % % of Net sales 30.4 % 30.4 % — Net sales in Latin America increased 13.7% in the second quarter of 2026 to $1,372, driven by volume growth of 2.6%, net selling price increases of 2.8% and positive foreign exchange of 8.4%.
MD&A: second-quarter 2026 Latin America price and volume results · Filed 31/07/2026
We are also increasingly dependent on certain key retailers, some of which exercise greater bargaining strength than we do, including the exclusive access to valuable first-party consumer data and analytics.
Risk factors: retailer bargaining strength · Filed 23/02/2026
They have demanded and may continue to demand higher trade discounts, allowances, slotting fees, significant investment (including through display media, paid search and co-op programs) or changes to product assortments, which have led to and could continue to lead to reduced sales or profitability in certain markets.
Risk factors: realized retailer concessions and economic effects · Filed 23/02/2026
In addition, “private label” products sold by our retail customers, which are typically sold at lower prices than branded products, are a source of competition for certain of our products.
Risk factors: lower-priced private-label competition · Filed 23/02/2026
In addition, the substantial growth of eCommerce and the emergence and adoption of social commerce and AI have encouraged the entry of new competitors, some of which sell products direct-to-consumer.
MD&A: digital channels encouraging competitor entry · Filed 31/07/2026
76 Table of Contents Annex A Reconciliation of Non-GAAP Financial Measures 2023 2024 2025 Net Sales Growth—GAAP 8.3 % 3.3 % 1.4 % Acquisitions and Divestments Impact (1.1 ) — (0.3 ) Foreign Exchange Impact 1.2 4.1 0.3 Organic Sales Growth—Non-GAAP 8.4 % 7.4 % 1.4 % 2022 2023 2024 2025 Diluted Earnings Per Share as Reported—GAAP $ 2.13 $ 2.77 $ 3.51 $ 2.63 Acquisition-Related Costs 0.02 — — 0.01 Goodwill and Intangible Assets Impairment Charges 0.74 — — 0.98 Restructuring Programs(1) 0.10 0.03 0.09 0.01 Gain on the Sale of Land in Asia Pacific (0.02 ) — — — ERISA Litigation Matter — 0.26 — 0.06 Foreign Tax Matter — 0.15 — — Product Recall Costs — 0.02 — — Base Business Earnings Per Share—Non-GAAP $ 2.97 $ 3.23 $ 3.60 $ 3.69 (Dollars in millions) 2022 2023 2024 2025 Net Income Attributable to Colgate-Palmolive Company—GAAP $ 1,785 $ 2,300 $ 2,889 $ 2,132 Acquisition-Related Costs 16 — — 7 Goodwill and Intangible Assets Impairment Charges 620 — — 794 Restructuring Programs(1) 87 25 73 11 Gain on the Sale of Land in Asia Pacific (15 ) — — — ERISA Litigation Matter — 212 — 53 Foreign Tax Matter — 126 — — Product Recall Costs — 19 — — Base Business Net Income—Non-GAAP $ 2,493 $ 2,682 $ 2,962 $ 2,996 (Dollars in millions) 2023 2024 2025 Net Cash Provided by Operations—GAAP $ 3,745 $ 4,107 $ 4,198 Less: Capital Expenditures (705 ) (561 ) (564 ) Free Cash Flow Before Dividends—Non-GAAP $ 3,040 $ 3,546 $ 3,634 The impact of non-GAAP adjustments may not necessarily equal the difference between “GAAP” and "non-GAAP" as a result of rounding.
Annex A: 2023–2025 growth, earnings and cash-flow reconciliations · Filed 25/03/2026
69 COLGATE-PALMOLIVE COMPANY Consolidated Statements of Income For the years ended December 31, (Dollars in Millions Except Per Share Amounts) 2025 2024 2023 Net sales $ 20,382 $ 20,101 $ 19,457 Cost of sales 8,131 7,940 8,131 Gross profit 12,251 12,161 11,326 Selling, general and administrative expenses 7,903 7,729 7,151 Other (income) expense, net 123 164 191 Goodwill and intangible assets impairment charges 919 — — Operating profit 3,306 4,268 3,984 Non-service related postretirement costs 55 87 360 Interest expense 267 292 287 Interest income 75 67 55 Income before income taxes 3,059 3,956 3,392 Provision for income taxes 798 907 937 Net income including noncontrolling interests 2,261 3,049 2,455 Less: Net income attributable to noncontrolling interests 129 160 155 Net income attributable to Colgate-Palmolive Company $ 2,132 $ 2,889 $ 2,300 Earnings per common share, basic $ 2.64 $ 3.53 $ 2.78 Earnings per common share, diluted $ 2.63 $ 3.51 $ 2.77 See Notes to Consolidated Financial Statements.
Consolidated statements of income: 2023–2025 results and impairment charges · Filed 23/02/2026
Net sales for Hill’s Pet Nutrition increased 2.9% in 2025 to $4,613, driven by net selling price increases of 3.0% and positive foreign exchange of 0.5%, partially offset by volume declines of 0.6%.
MD&A: Hill’s 2025 pricing and volume results · Filed 23/02/2026
The Prime100 acquisition contributed 1.1% to volume.
MD&A: acquisition contribution to Hill’s volume · Filed 23/02/2026
Organic sales in Hill’s Pet Nutrition increased 1.2% in 2025 despite a negative impact from lower private label sales (320 bps).
MD&A: Hill’s organic growth and lower private-label sales · Filed 23/02/2026
This decrease in Gross profit margin was due to significantly higher raw and packaging material costs (350 bps), which included the impact of tariffs, partially offset by cost savings from the Company’s funding-the-growth initiatives (230 bps), higher pricing (80 bps) and favorable mix (20 bps).
MD&A: first-quarter 2026 gross-margin cost, pricing and productivity bridge · Filed 01/05/2026
Operating profit margin was 19.0% in the second quarter of 2026, a decrease of 210 bps compared to 21.1% in the second quarter of 2025.
MD&A: second-quarter 2026 GAAP operating margin · Filed 31/07/2026
Excluding the items described above in both periods, as applicable, Operating profit margin was 21.4% in the second quarter of 2026, an increase of 10 bps compared to 21.3% in the second quarter of 2025.
MD&A: second-quarter 2026 adjusted operating margin · Filed 31/07/2026
4 COLGATE-PALMOLIVE COMPANY Condensed Consolidated Statements of Cash Flows (Dollars in Millions) (Unaudited) Six Months Ended June 30, 2026 2025 Operating Activities Net income including noncontrolling interests $ 1,401 $ 1,499 Adjustments to reconcile net income including noncontrolling interests to net cash provided by operations: Depreciation and amortization 311 299 ERISA litigation matter — 65 Restructuring and termination benefits, net of cash 232 (13) Stock-based compensation expense 78 55 Deferred income taxes (15) (17) Cash effects of changes in: Receivables (274) (152) Inventories (110) 3 Accounts payable and other working capital 124 (248) Other non-current assets 47 31 Other non-current liabilities (52) (38) Net cash provided by (used in) operations 1,742 1,484 Investing Activities Capital expenditures (266) (232) Purchases of marketable securities and investments (124) (384) Proceeds from sale of marketable securities and investments 150 350 Payment for acquisition, net of cash acquired — (293) Other investing activities (4) (1) Net cash provided by (used in) investing activities (244) (560) Financing Activities Short-term borrowing (repayment) less than 90 days, net 1,053 (30) Principal payments of debt (1,086) (139) Proceeds from issuance of debt — 497 Dividends paid (879) (880) Purchases of treasury shares (597) (516) Proceeds from exercise of stock options 138 65 Other financing activities (43) 136 Net cash provided by (used in) financing activities (1,414) (867) Effect of exchange rate changes on Cash and cash equivalents (2) 62 Net increase (decrease) in Cash and cash equivalents 82 119 Cash and cash equivalents at beginning of the period 1,288 1,096 Cash and cash equivalents at end of the period $ 1,370 $ 1,215 Supplemental Cash Flow Information Income taxes paid $ 459 $ 530 Interest paid $ 127 $ 137 See Notes to Condensed Consolidated Financial Statements.
Condensed cash-flow statements: first-half 2026 spending, financing and distributions · Filed 31/07/2026
The Strategic Growth and Productivity Program is now estimated to result in cumulative pre-tax charges, once all initiatives are approved and implemented, totaling between $350 and $550, increased from $200 to $300.
Restructuring note: expanded estimated program charges · Filed 01/05/2026
Annualized pre-tax savings are projected to be in the range of $200 to $300, once all projects are approved and implemented.
MD&A: projected annualized productivity savings · Filed 31/07/2026
Compensation Governance Our key executive compensation practices include the following: High percentage of compensation is variable and is tied to annual and long-term performance Double-trigger vesting of severance payments upon change in control Multiple performance measures used No executive officer employment agreements Robust stock ownership guidelines No hedging or pledging of Company stock is permitted Clawback policies tied to financial restatements or code of conduct violations No backdating, springloading or repricing of stock options Only ongoing perquisites relate to CEO security No tax gross-ups on perquisites or severance Please see the CD&A beginning on page 28 for a detailed description of our executive compensation programs.
Executive compensation: existing compensation governance practices · Filed 25/03/2026
For example, following dialogue and collaboration with our stockholders and other stakeholders, we have adopted the following corporate and compensation governance enhancements in recent years: ● Reducing the threshold for stockholders to call special meetings from 25% to 15% ● Enhancing the duties of our Lead Director ● Adopting a policy that we will not execute any new severance agreement with an executive officer that provides for cash severance benefits exceeding 2.99 times the sum of the executive officer’s base salary plus target bonus opportunity without seeking stockholder ratification of the agreement ● Adopting a requirement prohibiting our officers from selling net after-tax shares of Common Stock received upon the vesting of any restricted stock unit award until they have achieved their required ownership level ● Enhancing our political contributions policy ● Enhancing our director time commitment policy Communications to the Board of Directors Stockholders and other interested parties are encouraged to communicate directly with our independent directors by sending an email to [email protected] or by writing to Directors, c/o Office of the Chief Legal Officer, Colgate-Palmolive Company, 300 Park Avenue, 11th Floor, New York, New York 10022.
Governance: adopted shareholder rights and share-retention requirements · Filed 25/03/2026
Consistent with these financial results and reflecting the impact of our pay-for-performance philosophy, our annual incentive payments also declined in 2025.
Executive compensation: realized decline in 2025 annual incentive payments · Filed 25/03/2026
The governance section beginning on page 6 describes our corporate governance framework and commitment, which include the following highlights: BOARD FOCUSED ON KEY STRATEGIC PRIORITIES Board plays major role in overseeing business strategy and performance, risk management, Company culture and succession planning Board and management focus on cybersecurity, AI, sustainability and human capital matters FOCUS ON BOARD PERFORMANCE Board composition defined by strong leadership and experience Strong record of Board refreshment and mix of tenure of directors Strong focus on having a range of backgrounds, perspectives, skills and experiences represented on the Board 96% average attendance of incumbent directors at Board and committee meetings in 2025 Mandatory retirement age of 72 provides a mechanism for regular Board refreshment Directorship limits and related policies prevent overboarding Annual Board and committee self-evaluations Regular independent director evaluations conducted by an external facilitator Regular review of committee charters, corporate governance guidelines, director qualifications and related policies ALIGNMENT WITH STOCKHOLDER INTERESTS Substantial majority of director compensation paid in Company equity Robust stock ownership requirements for directors and officers Prohibitions on insider trading and hedging or pledging Company stock Stringent clawback policies Pay-for-performance philosophy Robust annual stockholder engagement program BOARD INDEPENDENCE Strict director independence standards 9 out of 10 director nominees are independent (all except for the Chief Executive Officer) Board committees are 100% independent Robust independent Lead Director duties Executive sessions of independent directors are held at every regularly scheduled Board meeting STOCKHOLDER RIGHTS Annual election of all directors Majority voting and director resignation policy for directors in uncontested elections Annual “say on pay” advisory vote Stockholders have ability to call special meetings (15% threshold) and to act by written consent Stockholders have proxy access right 4 Table of Contents Proxy Statement Summary Executive Compensation Program Highlights The key principles underlying our compensation philosophy are aligning pay and performance, driving strong business results and our strategic plan, focusing on long-term shareholder return, motivating and retaining critical talent and reflecting external market and competitive practices.
Proxy summary: board practices, attendance and shareholder rights · Filed 25/03/2026
employee director, Noel Wallace, who is our President and CEO and Chairman of the Board.
Governance: combined chairman and CEO position at proxy date · Filed 25/03/2026
15 COLGATE-PALMOLIVE COMPANY Notes to Condensed Consolidated Financial Statements (Dollars in Millions Except Share and Per Share Amounts) (Unaudited) Following adverse decisions by the District Court and the United States Court of Appeals for the Second Circuit, the Company recorded charges to earnings of $267 in the quarter ended March 31, 2023 and $65 in the quarter ended March 31, 2025 to reflect the then current estimated increase in pension plan liability and other related costs.
Contingencies: adverse ERISA decisions and recorded charges · Filed 31/07/2026
In the quarter ended September 30, 2025, the parties entered into a settlement agreement to fully resolve the litigation for $332, inclusive of attorneys’ fees and costs.
Contingencies: ERISA settlement amount · Filed 31/07/2026
Corporate Operating profit (loss) for the six months ended June 30, 2026 included charges resulting from the Strategic Growth and Productivity Program of $300.
Segment note: first-half 2026 productivity-program charges · Filed 31/07/2026
