Investing.com - Colgate-Palmolive (NYSE:CL) has slashed its full-year guidance for organic sales, becoming the latest company to cite possible headwinds from aggressive U.S. tariffs, although the consumer goods group still delivered better-than-anticipated first-quarter earnings.
Several companies including Procter & Gamble (NYSE:PG), PepsiCo (NASDAQ:PEP), American Airlines (NASDAQ:AAL), and Chipotle Mexican Grill (NYSE:CMG), either scrapped or cut their financial forecasts due to uncertainties around the impact of the levies.
Economists have flagged that President Donald Trump’s tariffs stand to push up inflation and weigh on growth in the U.S., and potentially spread to other parts of the global economy. Businesses, meanwhile, have warned that uncertainty around the on-and-off levies has made it difficult to plan out future investment decisions.
Data has also shown that consumer sentiment has deteriorated and inflation expectations have risen, possibly leading to more shoppers choosing to rein in spending to protect their pocket books.
Against this backdrop, Colgate-Palmolive (NYSE:CL), whose brands include Colgate toothpaste and Sanex shower gel, said it now expects organic sales growth will be between 2% to 4% this year. It previously guided for expansion of 3% to 5%.
Annual gross profit margin is tipped to be "roughly flat as a percentage of net sales," compared to a prior outlook of "flat to up." Earnings per share is seen increasing in the low-single digits, versus its January forecast for growth in the low to mid-single digits.
"As we look ahead, uncertainty and volatility in global markets, including the impact of tariffs, remain challenging. We are confident in our strategy and will continue to execute with focus and agility to mitigate these factors and achieve our revised 2025 financial targets," said CEO Noel Wallace in a statement on Friday.
In the first quarter, adjusted earnings per share came in at $0.91. Bloomberg consensus estimates had called for $0.86.
Net sales fell by 3% against a year ago to $4.91 billion. Organic sales grew by 1.4%.
Shares in Colgate-Palmolive were muted in premarket U.S. trading.