Colgate-Palmolive Q2 ad spend up 23% to Rs 889 mn

MUMBAI: Colgate Palmolive, which had announced a six per cent workforce reduction globally, continues to increase its advertising expenditure in India amid intense competition in a slowdown year.

For the fiscal-second quarter, the oral care and healthcare company has increased its ad and promotional expenses by 23.02 per cent to Rs 889.2 million compared to Rs 722.8 million a year ago. The ad to revenue ratio has climbed to 11.49 per cent from 10.71 per cent in the earlier year.

The fiscal-second quarter is in line with the first three months ended June in which period Colgate-Palmolive had splurged an amount of Rs 837.2 mn, 32 per cent more than the earlier year.

Colgate-Palmolive‘s advertising and promotion spends for the half year ended 30 September grew 27.21 per cent to Rs 1.73 billion compared to Rs 1.36 billion year ago. The revenue to advertising ratio has increased from 10.45 per cent to 11.38 per cent during this period.

Revenue for the half year ended 30 September 30 was Rs 15.09 billion, a 19 per cent increase over the same period of the prior year (Rs 13.02 billion). Profit for the half year stood at Rs 2.62 billion which is 31 per cent more than the profit recorded for same period of the previous year (Rs two billion).

Colgate-Palmolive reported net sales of Rs 7.74 billion for the second quarter of the FY13 which is 18 per cent more over the same quarter of the previous year. Net profit for the quarter was Rs 1.45 billion, up 0.67 per cent from last year’s Rs 1.48 billion.

The company launched a new toothpaste variant – Colgate Total Advance Whitening and Colgate Max Fresh Ice toothpaste. These launches were coupled with the new launches in the toothbrush category in the first quarter of the year, namely Colgate 360 Battery Toothbrush. The company also launched Colgate Max Fresh toothbrush that has specially designed multi-height bristles that penetrate between teeth to clean away plaque and an advanced tongue freshener with 3 waves of multi-dimensional cleaning.

In an inflationary environment, the company’s continuing efforts and focussed programs to enhance efficiencies and reduce costs continue to yield strong, positive results helping to maintain margin and fund investments in building and strengthening brand equity and the business. Prudent price increases and cost management has enabled the company to maintain its Gross margin for the period despite significant inflationary pressure.

Colgate-Palmolive along with the Indian Dental Association (IDA) commenced its 9th edition of Oral Health Month which will be 2-month long intensive oral care awareness initiative that aims to improve the oral health condition and generate awareness about tooth cavities in the country. As part of this initiative, 13 mobile dental vans will travel across 39 cities to make basic oral care facilities accessible to the underprivileged, through the support of IDA dentists. This year through OHM, Colgate along with IDA plans to reach 3 million people over 1200 towns and cities.

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