Colgate-Palmolive Company

Welcome to today's Colgate-Palmolive Third Quarter 2023 Earnings Conference Call. This call is being recorded and is being simulcast live at www.colgate-palmolive.com. Now, for opening remarks, I'd like to turn this call over to Chief Investor Relations Officer and Executive Vice President, M&A, John Fusche.

Thanks, Allison. Good morning and welcome to our third quarter 2023 earnings release conference call. This is John Fauché. Today's conference call will include forward-looking statements. Actual results could differ materially from these statements. Please refer to the Q3 2023 earnings press release and related prepared materials and our most recent filings with the SEC, including our 2022 annual report on Form 10-K and subsequent SEC filings, all available on Colgate's website for a discussion of the factors that could cause actual results to differ materially from these statements. This conference call will also include a discussion of non-GAAP financial measures, including those identified in Tables 4, 6, 7, 8, and 9 of the Earnings Press Release. A full reconciliation to the corresponding GAAP financial measures is included in the Q3 2023 Earnings Press Release and is available on Colgate's website. Joining me on the call this morning are Noel Wallace, Chairman, President, and Chief Executive Officer, and Stan Satula, Chief Financial Officer. Noel will provide you with some thoughts on our Q3 results and our 2023 outlook, and then we will open it up for Q&A. Noel?

Good morning, everyone. I want to give you my thoughts this morning on a very strong quarter of top and bottom line growth, along with our raised 2023 outlook. As you can see in the materials we published this morning, our strategy is working, and the continued execution of the strategy leaves us well positioned as we look out to the future. We believe this will enable us to deliver balanced organic sales growth going forward, growing in all six divisions, all four of our categories, and with both volume and pricing growth. Organic volume performance improved in the quarter, which we believe puts us on our way towards a return to volume growth. And with the leverage from this balanced growth, along with the global productivity initiative, focused cost containment, and our funding the growth initiatives, we now have multiple points of leverage in our P&L. This should enable us to deliver consistent operating profit and earnings growth going forward. You can see this in our Q3 results as our gross margin was up both sequentially and year-on-year driven by sales growth, and overheads were down driven by logistics. This leverage allowed us to deliver another quarter of double-digit operating profit growth, along with a 23% increase in advertising. Some of our markets remain choppy, and headwinds like foreign exchange and higher interest rates will continue to impact us. But we are leveraging the strength and the global reach of our brands while driving scale advantages through our science-based innovation, digital marketing, revenue growth management, and best-in-class on-the-ground execution. Our momentum leaves us very well positioned to deliver strong results with compounding top and bottom line growth as we look to generate consistent long-term creation, value creation for all of our stakeholders. And with that, I'll turn it over to questions.