Q3: Hill’s volume decline eased by Prime100 acquisition

Hill’s Pet Nutrition posted net sales of $1.14 billion (€1.06B) for the third quarter (Q3) 2025, reflecting a 1.4% year-over-year (YoY) increase. 

Despite the positive performance, the pet food division of American multinational Colgate-Palmolive registered declines in other key figures: -1.3% in organic sales, -4.2% in organic volume.

The operating profit stood up at $255 million (€220M) between July and September 2025, a 1% decline.

Private label and acquisition  

Most of these drops are attributed to the full exit of the private label business in the pet sector, which, according to the company, was completed during the quarter. For instance, part of the organic sales dip stems from the 3.7% decline in private-label sales. 

Another example is that the 4.2% drop in organic volume would be just 0.6% if the impact of the private-label exit were excluded.

The acquisition of Prime100 in Australia in February 2025 helped offset weaker results, contributing 1.6% to the segment’s reported volume growth in Q3 FY2025.

What else drove Hill’s performance

Volume was hit harder during the period. According to the company, part of this is due to “a modest further deceleration in category growth,” but also to “inventory reductions in e-commerce during the quarter.” However, the company does not disclose the Hill’s share of e-commerce sales.

Another losing subcategory during the quarter was dry pet food, which lagged “behind the overall category.” 

This led the company to expand wet food capacity, focusing on innovation and “mixed feeding opportunities to unlock market share growth,” and to invest in the therapeutic segment, with the launch of 21 new variants of Hill’s Prescription Diet mousses for cats in Europe.

When e-commerce sales slowed, the company invested in other retail formats. It reports having added 20,000 new points of distribution for wet cat food in the US. 

Penetration in America

Additionally, the company reports having grown its penetration in American retailers, mainly with Hill’s Science Diet in pet specialty stores, neighborhood pet shops and e-commerce.

While volume fell, pricing increased by 2.9%, above the company average (2.3%), highlighting the “strength of higher margin brands” like Hill’s Prescription Diet as favorable contributors to gross profit margin. 

From January to September, Hill’s reported net sales of $3.41 billion (€3.17B), up from $3.34 billion (€3.11B) last year.

Organic sales also grew 1.2%, while organic volume fell 1.8%. Pricing, however, increased by 3%.

Global performance

Colgate-Palmolive reported $5.1 billion (€4.74B) in net sales in Q3 2025, rising 2% YoY, mainly driven by the 1.2% benefit from foreign exchange.

Organic sales grew slightly by 0.4%, driven by the oral care and pet food businesses, offset by the -0.8% impact of the exit of the private label pet food business.

For the first 9 months of 2025, the multinational posted net sales of $15.1 billion (€14.09B), a marginal 0.02% decline from the previous year.

Organic sales grew 1.2%, but organic volume slipped 0.7%. Pricing was up 1.9% during the period.

Guidance

Colgate-Palmolive maintains its non-generally accepted accounting principles (non-GAAP) net sales growth forecast in the low single digits. 

“Over the course of the fourth quarter and into 2026, we are accelerating change at Colgate-Palmolive to boost category growth and drive market share gains as we aim to return to our historical growth rates,” the company says.

However, it now expects organic sales growth of 1% to 2%, down from the previous 2% to 4%, including an approximately 70-basis-point impact from its exit from private-label pet sales.

“Given the outlook for interest rates and lower debt levels, interest expense is now expected to decline in 2025, compared with the previous outlook of flat to slightly down.”