Hill's Pet Nutrition, a division of Colgate-Palmolive, recently released its financial results for the fourth quarter (Q4) ended December 31.
Net sales for Hill’s Pet Nutrition totaled $1.11 billion, up 5% from $1.06 billion in the fourth quarter of fiscal 2022, the company reported. Operating profit was $231 million for the segment, down slightly from $233 million in fiscal 2022 in Q4.
Organic sales for the fiscal year demonstrated a robust growth of 10.5%, with pricing rising by 11%.
Reported volume was down 4% reflecting the impact of lower private label volume, said the company. Organic sales exhibited a growth of 4.5%, with pricing rising by 8.5%. Organic volume, however, experienced a 4% decline during the quarter. The decrease in volume was attributed to lower private-label pet food volumes.
Hill’s Pet Nutrition’s operating profit represented 20.7% of net sales in the fourth quarter, down 130 basis points year-over-year.
The company noted the decrease in operating profit as a percentage of net sales was primarily due to significantly higher raw and packaging material costs, increased advertising investment and startup costs associated with a new manufacturing plant, partially offset by higher pricing and cost savings from the company’s funding-the-growth initiatives, noted the company.
"While the pet food category has slowed, we are still gaining share in the pet specialty channel behind the strength of our science-driven portfolio and our investment behind brand building, with advertising spending at Hill’s up more than 100 bps on a percent to sales basis for both the fourth quarter and the year," the company reported.
Hill’s Pet Nutrition represented 23% of Colgate-Palmolive Company’s total sales in Q4 2023. The company’s U.S. and Europe divisions led organic sales growth in Q4.
The company noted its continued investments in the capabilities required to deliver robust growth going forward, building strength in areas like innovation, digital, data and analytics, revenue growth management and advertising. Hill’s Pet Nutrition opened its newest manufacturing plant in Tonganoxie, Kansas, in October. The 365,000 square foot, fully-designed smart facility will increase the company's production capacity for canned pet food and provide a runway for continued expansion of Hill's Science Diet and Prescription Diet brands.
"With the opening of our Tonganoxie plant last year, we have significant innovation planned for both our Science Diet and Prescription Diet wet food portfolios," said the company. "Our enhanced science-based offerings include alternate forms and packages like stews, mousses, pouches and multi-packs that have secured additional shelf space in the pet specialty channel."
According to Petfood Industry's Top Pet Food Companies, Hill's Pet Nutrition sells more than 300 products, principally through authorized pet supply retailers and veterinarians in more than 80 countries worldwide.
