Colgate Palmolive : Nine Months Ended September 30, 2020 and 2019

Table 9

Colgate-Palmolive Company

Non-GAAP Reconciliations

For the Nine Months Ended September 30, 2020 and 2019

(Dollars in Millions Except Per Share Amounts) (Unaudited)

Gross Profit Gross profit, GAAP Acquisition-related costs

Global Growth and Efficiency Program Gross profit, non-GAAP

Gross Profit Margin Gross profit margin, GAAP

Global Growth and Efficiency Program Gross profit margin, non-GAAP

2020

$

7,374 4 -

$

7,378

2020

60.7 % - % 60.7 %

2019

$ 6,911 - 9 $ 6,920

2019

59.2 % 0.1 %

59.3

%

Basis Point

Change

150

140

Selling, General and Administrative Expenses Selling, general and administrative expenses, GAAP Global Growth and Efficiency Program (1)

Selling, general and administrative expenses, non-GAAPSelling, General and Administrative Expenses as a Percentage of Net Sales Selling, general and administrative expenses as a percentage of Net sales, GAAP Global Growth and Efficiency Program

Selling, general and administrative expenses as a percentage of Net sales, non-GAAP

2020

$

4,386 3

$

4,389

2020

36.1 % - % 36.1 %

2019

$ 4,163

(42) $ 4,121

2019

35.6 % (0.3)% 35.3 %

Basis Point

Change

50

80

Other (Income) Expense, Net Other (income) expense, net, GAAP Global Growth and Efficiency Program (1) Acquisition-related costs

Other (income) expense, net, non-GAAP

2020

2019

$

72 $ 125

13 (43)

(2) (18)

$

83

$

64

Operating Profit Operating profit, GAAP

Global Growth and Efficiency Program (1) Acquisition-related costs

Operating profit, non-GAAP

Operating Profit Margin Operating profit margin, GAAP

Global Growth and Efficiency Program (1) Acquisition-related costs

Operating profit margin, non-GAAP

2020

2019

$

2,916

(16) 94 6 18

$

2,906

2020

24.0 % (0.1)% - % 23.9 %

$ 2,623

$ 2,735

2019

22.5 % 0.8 % 0.1 %

23.4

%

% Change

11 %

6 %

Basis Point

Change

150

50

Non-Service Related Postretirement Costs Non-service related postretirement costs, GAAP Global Growth and Efficiency Program

Non-service related postretirement costs, non-GAAP

2020

$

56 -

$

56

2019

$

79 (4)

$

75

Table 9 Continued

Colgate-Palmolive Company

Non-GAAP Reconciliations

For the Nine Months Ended September 30, 2020 and 2019

(Dollars in Millions Except Per Share Amounts) (Unaudited)

2020

Net IncomeIncome Before Income TaxesProvision For Income Taxes(2)

Including Noncontrolling

Net Income Attributable To Colgate-Palmolive

Effective

Interests

Company

Income Tax Rate(3)Diluted Earnings Per Share

As Reported GAAP

$

2,753

$

585

$

2,168

$

2,048

21.2 % $ 2.38

Global Growth and Efficiency Program (1)

(16)

(3)

(13)

(13)

- % (0.02)

Subsidiary and operating structure initiatives Acquisition-related costs Non-GAAP

$

- 6 2,743

$

71 2 655

(71)

(71)

2.7 % (0.08)

4

4

- % 0.01

$

2,088

$

1,968

23.9 %

$

2.29

2019

Net IncomeIncome Before Income TaxesProvision For Income Taxes(2)

Including Noncontrolling

Net Income Attributable To Colgate-Palmolive

Effective

Interests

Company

Income Tax Rate(3)Diluted Earnings Per Share

As Reported GAAP

$

2,431

$

Global Growth and Efficiency Program

U.S. tax reform Non-GAAP

$

98 18 2,547

$

586 23 4 613

$

1,845

$

1,724

24.1 % $ 2.00

$

75 14 1,934

75 - % 0.09

14 - % 0.01

$

1,813

24.1 %

$

2.10

The impact of non-GAAP adjustments may not necessarily equal the difference between "GAAP" and "non-GAAP" as a result of rounding.

Notes:

(1) During the nine months ended September 30, 2020, the Company adjusted the accrual balances related to certain projects approved prior to the conclusion of the Global Growth and Efficiency Program, which ended on December 31, 2019, resulting in a reduction of $16 ($13 aftertax). No new restructuring projects were approved for implementation during the nine months ended September 30, 2020.

(2) The income tax effect on non-GAAP items is calculated based upon the tax laws and statutory income tax rates applicable in the tax jurisdiction(s) of the underlying non-GAAP adjustment.

(3) The impact of non-GAAP items on the Company's effective tax rate represents the difference in the effective tax rate calculated with and without the non-GAAP adjustment on Income before income taxes and Provision for income taxes.