DALLAS, Oct. 22, 2020 /PRNewswire/ -- Kimberly-Clark
Corporation (NYSE: KMB) today reported third quarter 2020
results.
Executive Summary
- Third quarter 2020 net sales of $4.7
billion increased 1 percent compared to the year-ago period,
including organic sales growth of 3 percent.
- Diluted net income per share for the third quarter was
$1.38 in 2020 and $1.94 in 2019.
- Third quarter adjusted earnings per share were $1.72 in 2020 compared to $1.84 in 2019. Adjusted earnings per share
exclude certain items described later in this news release.
- Diluted net income per share for 2020 is expected to be
$6.41 to $6.72.
- The company is now targeting full-year 2020 organic net sales
growth of 5 percent and adjusted earnings per share of $7.50 to $7.65. The prior outlook was for organic
sales growth of 4 to 5 percent and adjusted earnings per share of
$7.40 to $7.60.
Chairman and Chief Executive Officer Mike Hsu said, "Kimberly-Clark teams around the
world are managing our near-term operating priorities extremely
well, with strong focus on employee health and safety and supply
chain excellence during this unprecedented time period. At
the same time, we are significantly increasing our growth
investments for future success, our market share positions are
healthy overall and we are on track to achieve excellent financial
results this year."
Hsu continued, "We delivered solid organic sales growth in the
third quarter, with good underlying performance and increased
demand because of COVID-19. We also achieved $140 million of cost savings and returned
approximately $560 million to
shareholders through dividends and share repurchases. While
earnings in the quarter were down as expected, we're raising our
full-year outlook and now expect adjusted earnings per share will
grow 9 to 11 percent this year. We continue to execute our
strategies well and remain very optimistic about our opportunities
to deliver balanced and sustainable growth and create long-term
shareholder value."
Third Quarter 2020 Operating Results
Sales of $4.7 billion in the third
quarter of 2020 increased 1 percent compared to the year-ago
period. Organic sales increased 3 percent, while changes in
foreign currency exchange rates reduced sales 2 percent.
Volumes rose 2 percent and the combined impact of changes in net
selling prices and product mix increased sales
1 percent. In North America, organic sales increased 8
percent in consumer products but fell 15 percent in K-C
Professional. Outside North America, organic sales rose 2
percent in developing and emerging markets and 3 percent in
developed markets.
Third quarter operating profit was $666
million in 2020 and $915
million in 2019. Results in both periods include
charges related to the 2018 Global Restructuring Program.
Results in 2019 also include a gain on the sale of a manufacturing
facility as part of the restructuring.
Third quarter adjusted operating profit was $806 million in 2020 and $859 million in 2019. Results benefited
from organic sales growth, $125
million of cost savings from the company's FORCE (Focused On
Reducing Costs Everywhere) program and $15
million of cost savings from the 2018 Global Restructuring
Program. Input costs decreased $25
million, driven by pulp and other raw materials. Other
manufacturing costs increased year-on-year, including costs related
to COVID-19. Advertising spending increased significantly and
general and administrative costs were also higher, including
capability-building investments and increased incentive
compensation expense. Foreign currency translation effects
reduced operating profit by $10
million and transaction effects also negatively impacted the
comparison.
The third quarter effective tax rate was 20.1 percent in 2020
and 22.8 percent in 2019. The third quarter adjusted
effective tax rate was 22.4 percent in 2020 and 21.5 percent in
2019. Kimberly-Clark's share of net income of equity
companies in the third quarter was $31
million in both 2020 and 2019.
Cash Flow and Balance Sheet
Cash provided by operations in the third quarter was
$559 million in 2020 and $886 million in 2019. The decrease was
driven by the timing of tax payments and higher working
capital. Capital spending for the third quarter was
$258 million in 2020 and $298 million in 2019. Proceeds from
dispositions of property in the third quarter of 2019 included
approximately $200 million from the
previously mentioned sale of a manufacturing facility as part of
the 2018 Global Restructuring Program. Third quarter 2020
share repurchases were 1.3 million shares at a cost of $194 million. The company expects full-year
repurchases will be $700
million. Total debt was $8.4
billion at September 30, 2020
and $7.7 billion at the end of
2019.
Third Quarter 2020 Business Segment Results
Personal Care Segment
Third quarter sales of $2.3
billion increased 1 percent. Volumes increased 4
percent and product mix improved 1 percent, while changes in
currency rates reduced sales by 4 percent. Third quarter
operating profit of $486 million
decreased 1 percent. Results were impacted by unfavorable
currency effects, higher advertising spending, other manufacturing
cost increases and higher general and administrative costs.
The comparison benefited from organic sales growth, cost savings
and lower input costs.
Sales in North America
increased 6 percent. Volumes increased 5 percent, driven by
baby and child care, and the combined impact of changes in net
selling prices and product mix improved sales 1 percent.
Sales in developing and emerging markets decreased 4
percent. Changes in currency rates reduced sales
11 percent. Volumes rose 5 percent, including increases
in China, Eastern Europe, India and Latin
America, and product mix improved more than 1 percent.
Sales in developed markets outside North America (Australia, South
Korea and Western/Central
Europe) increased 1 percent. Changes in currency
rates increased sales 2 percent. Net selling prices fell 3
percent while product mix improved 2 percent.
Consumer Tissue Segment
Third quarter sales of $1.6
billion increased 9 percent. Volumes increased 10
percent and net selling prices rose slightly, while product mix was
unfavorable by 1 percent. Changes in currency rates reduced
sales slightly. The volume increase was driven by increased
shipments in North America and
developed markets to support higher consumer and customer demand
related to the global outbreak of COVID-19. Third quarter
operating profit of $318 million
increased 20 percent. Results benefited from organic sales
growth, cost savings and lower input costs. The comparison
was impacted by increased advertising spending, other manufacturing
cost increases, higher general and administrative costs and
unfavorable currency effects.
Sales in North America
increased 11 percent. Volumes rose 11 percent and net selling
prices improved 2 percent, while product mix was down 2
percent. Volumes increased high-single digits to low-double
digits in all major product categories.
Sales in developing and emerging markets decreased 4 percent
including a 7 point negative impact from changes in currency
rates. Volumes rose 3 percent and product mix improved 2
percent, while net selling prices fell 2 percent.
Sales in developed markets outside North America increased 17 percent.
Volumes rose 14 percent, driven by South
Korea and Western/Central
Europe, while net selling prices fell 1 percent.
Changes in currency rates increased sales 4 percent.
K-C Professional (KCP) Segment
Third quarter sales of $0.7
billion decreased 16 percent. Volumes declined 21
percent, reflecting challenging economic and business conditions
globally following the outbreak of COVID-19. Changes in
currency rates reduced sales slightly, while net selling prices and
product mix each improved 3 percent. Third quarter operating
profit of $87 million decreased 51
percent. The comparison was impacted by lower organic sales,
other manufacturing cost increases including inefficiencies from
lower production volumes and higher input costs. Results
benefited from cost savings.
Sales in North America
decreased 15 percent. Volumes were down 21 percent, while net
selling prices and product mix each improved 3 percent. Sales
were down significantly in washroom products but increased
double-digits in wipers, safety and other products.
Sales in developing and emerging markets decreased 28 percent
including a 5 point negative impact from changes in currency
rates. Volumes fell 24 percent, with significant declines in
all major geographies, and product mix was down 2 percent.
Net selling prices increased 3 percent.
Sales in developed markets outside North America were down 8 percent.
Volumes decreased 18 percent, while product mix improved 4 percent
and net selling prices increased 3 percent. The changes were
driven by Western/Central Europe. Currency rates were
favorable by 3 percent.
Year-To-Date Results
For the first nine months of 2020, sales of $14.3 billion increased 3 percent. Organic
sales increased 6 percent, as volumes rose 4 percent and net
selling prices and product mix each improved 1 percent.
Changes in foreign currency exchange rates reduced sales by 3
percent and business exits in conjunction with the 2018 Global
Restructuring Program reduced sales slightly.
Year-to-date operating profit was $2,495
million in 2020 and $2,240
million in 2019. Results in both periods include
charges related to the 2018 Global Restructuring Program.
Year-to-date adjusted operating profit was $2,815 million in 2020 and $2,455 million in 2019. Results benefited
from organic sales growth, $345
million of FORCE cost savings and $95
million of cost savings from the 2018 Global Restructuring
Program. Input costs decreased $215
million, driven by pulp. The comparison was impacted
by other manufacturing cost increases, unfavorable currency
effects, higher general and administrative costs and increased
advertising spending.
Through nine months, diluted net income per share was
$5.30 in 2020 and $4.65 in 2019. Year-to-date adjusted
earnings per share were $6.06 in 2020
and $5.18 in 2019.
2018 Global Restructuring Program
In January 2018, Kimberly-Clark
initiated the 2018 Global Restructuring Program in order to reduce
the company's structural cost base and enhance the company's
flexibility to invest in its brands, growth initiatives and
capabilities critical to delivering future growth. As part of
the program, Kimberly-Clark expects to exit or divest some
low-margin businesses that generate about 1 percent of company net
sales.
The restructuring is expected to be completed in 2021, with
total restructuring charges anticipated to be toward the high end
of the range of $1,700 to
$1,900 million pre-tax ($1,300 to $1,400
million after tax). The company expects the program
will generate annual pre-tax cost savings of $500 to $550
million. The company continues to target to achieve
those savings by the end of 2021, although it is possible the full
realization could occur in 2022 because of the uncertainties
related to COVID-19. Through the third quarter of
2020, the company has incurred cumulative restructuring charges of
$1,739 million pre-tax ($1,284 million after tax) and generated
cumulative savings of $395
million.
2020 Outlook and Key Planning Assumptions
The company's outlook continues to assume no significant impact
from potential supply chain disruptions as a result of
COVID-19. In addition, the company updated the following key
planning and guidance assumptions for full-year 2020:
- Net sales increase of 2 to 3 percent (prior assumption 1 to 2
percent).
-
- Organic sales increase of 5 percent compared to the previous
target of 4 to 5 percent.
- Foreign currency exchange rates unfavorable between 2 and 3
percent (prior estimate 3 percent).
- The net impact of the acquisition of Softex Indonesia and
exited businesses in conjunction with the 2018 Global Restructuring
Program expected to increase sales slightly.
- Adjusted operating profit growth of 8 to 10 percent (prior
estimate 6 to 9 percent).
- Adjusted earnings per share of $7.50 to $7.65
compared to the prior outlook of $7.40 to $7.60 and
$6.89 in 2019.
Non-GAAP Financial Measures
This news release and the accompanying tables include the
following financial measures that have not been calculated in
accordance with accounting principles generally accepted in the
U.S., or GAAP, and are therefore referred to as non-GAAP financial
measures:
- Adjusted earnings and earnings per share
- Adjusted gross and operating profit
- Adjusted effective tax rate
These non-GAAP financial measures exclude the following items
for the relevant time periods as indicated in the accompanying
non-GAAP reconciliations to the comparable GAAP financial
measures:
- 2018 Global Restructuring Program. Mentioned elsewhere in
this release.
- Softex Indonesia acquisition-related costs. The company
incurred costs to evaluate and execute the acquisition of Softex
Indonesia.
The company provides these non-GAAP financial measures as
supplemental information to our GAAP financial measures.
Management and the company's Board of Directors use adjusted
earnings, adjusted earnings per share and adjusted gross and
operating profit to (a) evaluate the company's historical and
prospective financial performance and its performance relative to
its competitors, (b) allocate resources and (c) measure the
operational performance of the company's business units and their
managers. Management also believes that the use of an
adjusted effective tax rate provides improved insight into the tax
effects of our ongoing business operations.
Additionally, the Management Development and Compensation
Committee of the company's Board of Directors has used certain of
the non-GAAP financial measures when setting and assessing
achievement of incentive compensation goals. These goals are
based, in part, on the company's adjusted earnings per share and
improvement in the company's adjusted return on invested capital
determined by excluding certain of the adjustments that are used in
calculating these non-GAAP financial measures.
This news release includes information regarding organic sales
growth, which describes the impact of changes in volume, net
selling prices and product mix on net sales. Changes in
foreign currency exchange rates, exited businesses and acquisitions
also impact the year-over-year change in net sales.
Conference Call
A conference call to discuss this news release and other matters
of interest to investors and analysts will be held at 9 a.m. (CDT) today. The conference call
will be simultaneously broadcast over the World Wide Web.
Stockholders and others are invited to listen to the live broadcast
or a playback, which can be accessed by following the instructions
set out in the Investors section of the company's Web site
(www.kimberly-clark.com).
About Kimberly-Clark
Kimberly-Clark (NYSE: KMB) and its trusted brands are an
indispensable part of life for people in more than 175
countries. Fueled by ingenuity, creativity, and an
understanding of people's most essential needs, we create products
that help individuals experience more of what's important to
them. Our portfolio of brands, including Huggies, Kleenex,
Scott, Kotex, Cottonelle, Poise, Depend, Andrex, Pull-Ups,
GoodNites, Intimus, Neve, Plenitud, Viva and WypAll, hold No. 1 or
No. 2 share positions in 80 countries. We use sustainable
practices that support a healthy planet, build strong communities,
and ensure our business thrives for decades to come. To keep
up with the latest news and to learn more about the company's
148-year history of innovation, visit kimberly-clark.com.
Copies of Kimberly-Clark's Annual Report to Stockholders and its
proxy statements and other SEC filings, including Annual Reports on
Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on
Form 8-K, are made available free of charge on the company's Web
site on the same day they are filed with the SEC. To view
these filings, visit the Investors section of the company's Web
site.
As more fully described in Kimberly-Clark's Quarterly Report
on Form 10-Q for the quarter ended September
30, 2020, the company has been actively monitoring the
COVID-19 situation and its impact globally. The impact of
COVID-19 and measures to prevent its spread are affecting our
business in a number of ways. We have experienced increased
volatility in demand for some of our products as consumers adapt to
the evolving environment. We have also experienced incidents
of supply chain disruption and increased currency and commodity
volatility. We expect the ultimate significance of the impact
on our financial and operational results will be dictated by the
length of time that such circumstances continue, which will depend
on the currently unknowable extent and duration of the COVID-19
pandemic and any governmental and public actions taken in
response. COVID-19 also makes it more challenging for
management to estimate future business performance, particularly
over the near term.
Certain matters contained in this news release concerning the
outlook, anticipated financial and operating results, raw material,
energy and other input costs, anticipated currency rates and
exchange risks, including in Argentina, net income from equity companies,
sources and uses of cash, the effective tax rate, the anticipated
cost savings from the company's FORCE program, charges and savings
from the 2018 Global Restructuring Program, growth initiatives,
product innovations, contingencies and anticipated transactions of
the company constitute forward-looking statements and are based
upon management's expectations and beliefs concerning future events
impacting the company. In addition, many factors outside our
control, including pandemics (including the ongoing COVID-19
outbreak), epidemics, failure to realize the expected benefits or
synergies from the Softex Indonesia acquisition, fluctuations in
foreign currency exchange rates, the prices and availability of our
raw materials, potential competitive pressures on selling prices
for our products, energy costs, our ability to maintain key
customer relationships, as well as general economic and political
conditions globally and in the markets in which we do business,
could affect the realization of these estimates.
There can be no assurance that these future events will occur
as anticipated or that the company's results will be as
estimated. Forward-looking statements speak only as of the
date they were made, and we undertake no obligation to publicly
update them. For a description of certain factors that could
cause the company's future results to differ from those expressed
in any such forward-looking statements, see Item 1A entitled "Risk
Factors" in each of the company's Quarterly Report on Form 10-Q for
the quarter ended March 31, 2020 and
the company's Annual Report on Form 10-K for the year ended
December 31, 2019.
KIMBERLY-CLARK
CORPORATION
|
CONSOLIDATED INCOME
STATEMENTS
|
(Millions, except per
share amounts)
|
|
|
Three Months
Ended
September
30
|
|
|
|
2020
|
|
2019
|
|
Change
|
Net
Sales
|
$
|
4,683
|
|
$
|
4,640
|
|
+1 %
|
Cost of products
sold
|
3,093
|
|
3,085
|
|
—
|
Gross
Profit
|
1,590
|
|
1,555
|
|
+2 %
|
Marketing, research
and general expenses
|
919
|
|
815
|
|
+13 %
|
Other (income) and
expense, net
|
5
|
|
(175)
|
|
N.M.
|
Operating
Profit
|
666
|
|
915
|
|
-27 %
|
Nonoperating
expense
|
(40)
|
|
(11)
|
|
+264 %
|
Interest
income
|
2
|
|
3
|
|
-33 %
|
Interest
expense
|
(62)
|
|
(66)
|
|
-6 %
|
Income Before
Income Taxes and Equity Interests
|
566
|
|
841
|
|
-33 %
|
Provision for income
taxes
|
(114)
|
|
(192)
|
|
-41 %
|
Income Before
Equity Interests
|
452
|
|
649
|
|
-30 %
|
Share of net income of
equity companies
|
31
|
|
31
|
|
—
|
Net
Income
|
483
|
|
680
|
|
-29 %
|
Net income
attributable to noncontrolling interests
|
(11)
|
|
(9)
|
|
+22 %
|
Net Income
Attributable to Kimberly-Clark Corporation
|
$
|
472
|
|
$
|
671
|
|
-30 %
|
|
|
|
|
|
|
Per Share
Basis
|
|
|
|
|
|
Net Income
Attributable to Kimberly-Clark Corporation
|
|
|
|
|
|
Basic
|
$
|
1.38
|
|
$
|
1.95
|
|
-29 %
|
Diluted
|
$
|
1.38
|
|
$
|
1.94
|
|
-29 %
|
|
|
|
|
|
|
Cash Dividends
Declared
|
$
|
1.07
|
|
$
|
1.03
|
|
+4 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Shares
Outstanding
|
September
30
|
|
|
|
2020
|
|
2019
|
|
|
Outstanding shares as
of
|
340.4
|
|
343.1
|
|
|
Average diluted shares
for three months ended
|
342.3
|
|
345.9
|
|
|
KIMBERLY-CLARK
CORPORATION
|
CONSOLIDATED INCOME
STATEMENTS
|
(Millions, except per
share amounts)
|
|
|
Nine Months
Ended
September
30
|
|
|
|
2020
|
|
2019
|
|
Change
|
Net
Sales
|
$
|
14,304
|
|
$
|
13,867
|
|
+3 %
|
Cost of products
sold
|
9,146
|
|
9,398
|
|
-3 %
|
Gross
Profit
|
5,158
|
|
4,469
|
|
+15 %
|
Marketing, research
and general expenses
|
2,636
|
|
2,395
|
|
+10 %
|
Other (income) and
expense, net
|
27
|
|
(166)
|
|
N.M.
|
Operating
Profit
|
2,495
|
|
2,240
|
|
+11 %
|
Nonoperating
expense
|
(57)
|
|
(33)
|
|
+73 %
|
Interest
income
|
6
|
|
8
|
|
-25 %
|
Interest
expense
|
(188)
|
|
(198)
|
|
-5 %
|
Income Before
Income Taxes and Equity Interests
|
2,256
|
|
2,017
|
|
+12 %
|
Provision for income
taxes
|
(510)
|
|
(467)
|
|
+9 %
|
Income Before
Equity Interests
|
1,746
|
|
1,550
|
|
+13 %
|
Share of net income of
equity companies
|
104
|
|
91
|
|
+14 %
|
Net
Income
|
1,850
|
|
1,641
|
|
+13 %
|
Net income
attributable to noncontrolling interests
|
(37)
|
|
(31)
|
|
+19 %
|
Net Income
Attributable to Kimberly-Clark Corporation
|
$
|
1,813
|
|
$
|
1,610
|
|
+13 %
|
|
|
|
|
|
|
Per Share
Basis
|
|
|
|
|
|
Net Income
Attributable to Kimberly-Clark Corporation
|
|
|
|
|
|
Basic
|
$
|
5.32
|
|
$
|
4.68
|
|
+14 %
|
Diluted
|
$
|
5.30
|
|
$
|
4.65
|
|
+14 %
|
|
|
|
|
|
|
Cash Dividends
Declared
|
$
|
3.21
|
|
$
|
3.09
|
|
+4 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Shares
Outstanding
|
September
30
|
|
|
|
2020
|
|
2019
|
|
|
Average diluted shares
for nine months ended
|
342.3
|
|
346.0
|
|
|
KIMBERLY-CLARK
CORPORATION
|
NON-GAAP
RECONCILIATIONS
|
(Millions, except per
share amounts)
|
|
|
Three Months Ended
September 30, 2020
|
|
As
Reported
|
|
2018
Global
Restructuring
Program
|
|
Softex
Indonesia
Acquisition-
Related
Costs
|
|
As
Adjusted
Non-GAAP
|
Cost of products
sold
|
$
|
3,093
|
|
$
|
107
|
|
$
|
—
|
|
$
|
2,986
|
Gross
Profit
|
1,590
|
|
(107)
|
|
—
|
|
1,697
|
Marketing, research
and general expenses
|
919
|
|
25
|
|
9
|
|
885
|
Other (income) and
expense, net
|
5
|
|
(1)
|
|
—
|
|
6
|
Operating
Profit
|
666
|
|
(131)
|
|
(9)
|
|
806
|
Nonoperating
expense
|
(40)
|
|
(26)
|
|
—
|
|
(14)
|
Provision for income
taxes
|
(114)
|
|
50
|
|
—
|
|
(164)
|
Effective tax
rate
|
20.1
%
|
|
—
|
|
—
|
|
22.4
%
|
Share of net income
of equity companies
|
31
|
|
—
|
|
—
|
|
31
|
Net income
attributable to noncontrolling interests
|
(11)
|
|
—
|
|
—
|
|
(11)
|
Net Income
Attributable to Kimberly-Clark Corporation
|
472
|
|
(107)
|
|
(9)
|
|
588
|
Diluted Earnings per
Share(a)
|
1.38
|
|
(0.31)
|
|
(0.03)
|
|
1.72
|
|
|
|
Three Months Ended
September 30, 2019
|
|
As
Reported
|
|
2018
Global
Restructuring
Program
|
|
As
Adjusted
Non-GAAP
|
Cost of products
sold
|
$
|
3,085
|
|
$
|
104
|
|
$
|
2,981
|
Gross
Profit
|
1,555
|
|
(104)
|
|
1,659
|
Marketing, research
and general expenses
|
815
|
|
21
|
|
794
|
Other (income) and
expense, net(b)
|
(175)
|
|
(181)
|
|
6
|
Operating
Profit
|
915
|
|
56
|
|
859
|
Provision for income
taxes
|
(192)
|
|
(23)
|
|
(169)
|
Effective tax
rate
|
22.8 %
|
|
—
|
|
21.5 %
|
Net Income
Attributable to Kimberly-Clark Corporation
|
671
|
|
33
|
|
638
|
Diluted Earnings per
Share(a)
|
1.94
|
|
0.10
|
|
1.84
|
|
|
(a)
|
"As Adjusted
Non-GAAP" may not equal "As Reported" plus "Adjustments" as a
result of rounding.
|
(b)
|
Other (income) and
expense, net includes a pre-tax gain of approximately $182 on the
sale of a manufacturing facility and associated real estate which
were disposed of as part of the 2018 Global Restructuring
Program.
|
|
|
Unaudited
|
KIMBERLY-CLARK
CORPORATION
|
NON-GAAP
RECONCILIATIONS
|
(Millions, except per
share amounts)
|
|
|
Nine Months Ended
September 30, 2020
|
|
As
Reported
|
|
2018
Global
Restructuring
Program
|
|
Softex
Indonesia
Acquisition-
Related
Costs
|
|
As
Adjusted
Non-GAAP
|
Cost of products
sold
|
$
|
9,146
|
|
$
|
237
|
|
$
|
—
|
|
$
|
8,909
|
Gross
Profit
|
5,158
|
|
(237)
|
|
—
|
|
5,395
|
Marketing, research
and general expenses
|
2,636
|
|
75
|
|
9
|
|
2,552
|
Other (income) and
expense, net
|
27
|
|
(1)
|
|
—
|
|
28
|
Operating
Profit
|
2,495
|
|
(311)
|
|
(9)
|
|
2,815
|
Nonoperating
expense
|
(57)
|
|
(26)
|
|
—
|
|
(31)
|
Provision for income
taxes
|
(510)
|
|
83
|
|
—
|
|
(593)
|
Effective tax
rate
|
22.6
%
|
|
—
|
|
—
|
|
22.8
%
|
Share of net income
of equity companies
|
104
|
|
(1)
|
|
—
|
|
105
|
Net income
attributable to noncontrolling interests
|
(37)
|
|
2
|
|
—
|
|
(39)
|
Net Income
Attributable to Kimberly-Clark Corporation
|
1,813
|
|
(253)
|
|
(9)
|
|
2,075
|
Diluted Earnings per
Share(a)
|
5.30
|
|
(0.74)
|
|
(0.03)
|
|
6.06
|
|
|
|
Nine Months Ended
September 30, 2019
|
|
As
Reported
|
|
2018
Global
Restructuring
Program
|
|
As
Adjusted
Non-GAAP
|
Cost of products
sold
|
$
|
9,398
|
|
$
|
331
|
|
$
|
9,067
|
Gross
Profit
|
4,469
|
|
(331)
|
|
4,800
|
Marketing, research
and general expenses
|
2,395
|
|
66
|
|
2,329
|
Other (income) and
expense, net(b)
|
(166)
|
|
(182)
|
|
16
|
Operating
Profit
|
2,240
|
|
(215)
|
|
2,455
|
Provision for income
taxes
|
(467)
|
|
35
|
|
(502)
|
Effective tax
rate
|
23.2 %
|
|
—
|
|
22.5 %
|
Share of net income
of equity companies
|
91
|
|
(2)
|
|
93
|
Net income
attributable to noncontrolling interests
|
(31)
|
|
1
|
|
(32)
|
Net Income
Attributable to Kimberly-Clark Corporation
|
1,610
|
|
(181)
|
|
1,791
|
Diluted Earnings per
Share(a)
|
4.65
|
|
(0.52)
|
|
5.18
|
|
|
(a)
|
"As Adjusted
Non-GAAP" may not equal "As Reported" plus "Adjustments" as a
result of rounding.
|
(b)
|
Other (income) and
expense, net includes a pre-tax gain of approximately $182 on the
sale of a manufacturing facility and associated real estate which
were disposed of as part of the 2018 Global Restructuring
Program.
|
|
|
Non-GAAP financial
measures are not meant to be considered in isolation or as a
substitute for the comparable GAAP measures, and they should be
read only in conjunction with the company's consolidated financial
statements prepared in accordance with GAAP. There are
limitations to these non-GAAP financial measures because they are
not prepared in accordance with GAAP and may not be comparable to
similarly titled measures of other companies due to potential
differences in methods of calculation and items being
excluded. The company compensates for these limitations by
using these non-GAAP financial measures as a supplement to the GAAP
measures and by providing reconciliations of the non-GAAP and
comparable GAAP financial measures.
|
|
|
Unaudited
|
KIMBERLY-CLARK
CORPORATION
|
CONSOLIDATED BALANCE
SHEETS
|
(Millions)
|
|
|
September 30,
2020
|
|
December 31,
2019
|
ASSETS
|
|
|
|
Current
Assets
|
|
|
|
Cash and cash
equivalents
|
$
|
1,518
|
|
$
|
442
|
Accounts receivable,
net
|
2,125
|
|
2,263
|
Inventories
|
1,787
|
|
1,790
|
Other current
assets
|
645
|
|
562
|
Total Current
Assets
|
6,075
|
|
5,057
|
Property, Plant
and Equipment, Net
|
7,497
|
|
7,450
|
Investments in
Equity Companies
|
333
|
|
268
|
Goodwill
|
1,418
|
|
1,467
|
Other
Assets
|
1,208
|
|
1,041
|
TOTAL
ASSETS
|
$
|
16,531
|
|
$
|
15,283
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
Liabilities
|
|
|
|
Debt payable within
one year
|
$
|
517
|
|
$
|
1,534
|
Trade accounts
payable
|
2,995
|
|
3,055
|
Accrued expenses and
other current liabilities
|
2,230
|
|
1,978
|
Dividends
payable
|
360
|
|
352
|
Total Current
Liabilities
|
6,102
|
|
6,919
|
Long-Term
Debt
|
7,851
|
|
6,213
|
Noncurrent
Employee Benefits
|
873
|
|
897
|
Deferred Income
Taxes
|
500
|
|
511
|
Other
Liabilities
|
599
|
|
520
|
Redeemable
Preferred Securities of Subsidiaries
|
29
|
|
29
|
Stockholders'
Equity
|
|
|
|
Kimberly-Clark
Corporation
|
335
|
|
(33)
|
Noncontrolling
Interests
|
242
|
|
227
|
Total Stockholders'
Equity
|
577
|
|
194
|
TOTAL LIABILITIES
AND STOCKHOLDERS' EQUITY
|
$
|
16,531
|
|
$
|
15,283
|
KIMBERLY-CLARK
CORPORATION
|
CONSOLIDATED CASH
FLOW STATEMENTS
|
(Millions)
|
|
|
Three Months
Ended
September
30
|
|
Nine Months
Ended
September
30
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Operating
Activities
|
|
|
|
|
|
|
|
Net income
|
$
|
483
|
|
$
|
680
|
|
$
|
1,850
|
|
$
|
1,641
|
Depreciation and
amortization
|
192
|
|
230
|
|
606
|
|
700
|
Stock-based
compensation
|
47
|
|
26
|
|
101
|
|
74
|
Deferred income
taxes
|
(42)
|
|
(18)
|
|
(30)
|
|
8
|
Net (gains) losses on
asset dispositions
|
54
|
|
(172)
|
|
67
|
|
(155)
|
Equity companies'
earnings (in excess of) less than dividends paid
|
(6)
|
|
(1)
|
|
(53)
|
|
(31)
|
Operating working
capital
|
(198)
|
|
126
|
|
292
|
|
(399)
|
Postretirement
benefits
|
22
|
|
5
|
|
7
|
|
(16)
|
Other
|
7
|
|
10
|
|
2
|
|
(10)
|
Cash Provided by
Operations
|
559
|
|
886
|
|
2,842
|
|
1,812
|
Investing
Activities
|
|
|
|
|
|
|
|
Capital
spending
|
(258)
|
|
(298)
|
|
(894)
|
|
(867)
|
Proceeds from
dispositions of property
|
—
|
|
205
|
|
5
|
|
206
|
Investments in time
deposits
|
(186)
|
|
(167)
|
|
(509)
|
|
(353)
|
Maturities of time
deposits
|
150
|
|
58
|
|
404
|
|
287
|
Other
|
7
|
|
(43)
|
|
17
|
|
(40)
|
Cash Used for
Investing
|
(287)
|
|
(245)
|
|
(977)
|
|
(767)
|
Financing
Activities
|
|
|
|
|
|
|
|
Cash dividends
paid
|
(365)
|
|
(354)
|
|
(1,087)
|
|
(1,054)
|
Change in short-term
debt
|
170
|
|
(219)
|
|
(497)
|
|
324
|
Debt
proceeds
|
601
|
|
4
|
|
1,842
|
|
700
|
Debt
repayments
|
(501)
|
|
(2)
|
|
(753)
|
|
(705)
|
Proceeds from exercise
of stock options
|
77
|
|
51
|
|
212
|
|
211
|
Acquisitions of common
stock for the treasury
|
(186)
|
|
(214)
|
|
(449)
|
|
(544)
|
Other
|
(1)
|
|
(13)
|
|
(40)
|
|
(92)
|
Cash Used for
Financing
|
(205)
|
|
|
(747)
|
|
(772)
|
|
(1,160)
|
Effect of Exchange
Rate Changes on Cash and Cash Equivalents
|
3
|
|
(12)
|
|
(17)
|
|
(8)
|
Change in Cash and
Cash Equivalents
|
70
|
|
(118)
|
|
1,076
|
|
(123)
|
Cash and Cash
Equivalents - Beginning of Period
|
1,448
|
|
534
|
|
442
|
|
539
|
Cash and Cash
Equivalents - End of Period
|
$
|
1,518
|
|
$
|
416
|
|
$
|
1,518
|
|
$
|
416
|
KIMBERLY-CLARK
CORPORATION
|
SELECTED BUSINESS
SEGMENT DATA
|
(Millions)
|
|
|
Three Months
Ended
September
30
|
|
|
|
Nine Months
Ended
September
30
|
|
|
|
2020
|
|
2019
|
|
Change
|
|
2020
|
|
2019
|
|
Change
|
NET
SALES
|
|
|
|
|
|
|
|
|
|
|
|
Personal
Care
|
$
|
2,339
|
|
$
|
2,305
|
|
+1 %
|
|
$
|
6,990
|
|
$
|
6,866
|
|
+2 %
|
Consumer
Tissue
|
1,623
|
|
1,484
|
|
+9 %
|
|
4,991
|
|
4,482
|
|
+11 %
|
K-C
Professional
|
705
|
|
839
|
|
-16 %
|
|
2,277
|
|
2,477
|
|
-8 %
|
Corporate &
Other
|
16
|
|
12
|
|
N.M.
|
|
46
|
|
42
|
|
N.M.
|
TOTAL NET
SALES
|
$
|
4,683
|
|
$
|
4,640
|
|
+1 %
|
|
$
|
14,304
|
|
$
|
13,867
|
|
+3 %
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING
PROFIT
|
|
|
|
|
|
|
|
|
|
|
|
Personal
Care
|
$
|
486
|
|
$
|
490
|
|
-1 %
|
|
$
|
1,532
|
|
$
|
1,459
|
|
+5 %
|
Consumer
Tissue
|
318
|
|
264
|
|
+20 %
|
|
1,111
|
|
726
|
|
+53 %
|
K-C
Professional
|
87
|
|
176
|
|
-51 %
|
|
423
|
|
488
|
|
-13 %
|
Corporate &
Other(a)
|
(220)
|
|
(190)
|
|
N.M.
|
|
(544)
|
|
(599)
|
|
N.M.
|
Other (income) and
expense, net(a)
|
5
|
|
(175)
|
|
N.M.
|
|
27
|
|
(166)
|
|
N.M.
|
TOTAL OPERATING
PROFIT
|
$
|
666
|
|
$
|
915
|
|
-27 %
|
|
$
|
2,495
|
|
$
|
2,240
|
|
+11 %
|
|
|
(a)
|
Corporate & Other
and Other (income) and expense, net include income and expense not
associated with the business segments, including adjustments as
indicated in the Non-GAAP Reconciliations.
|
PERCENTAGE CHANGE
IN NET SALES VERSUS PRIOR YEAR
|
|
|
Three Months Ended
September 30, 2020
|
|
Total(a)
|
|
Volume
|
|
Net
Price
|
|
Mix/
Other
|
|
Currency
|
|
|
Organic(b)
|
Personal
Care
|
1
|
|
4
|
|
—
|
|
1
|
|
(4)
|
|
|
5
|
Consumer
Tissue
|
9
|
|
10
|
|
—
|
|
(1)
|
|
—
|
|
|
10
|
K-C
Professional
|
(16)
|
|
(21)
|
|
3
|
|
3
|
|
—
|
|
|
(15)
|
TOTAL
CONSOLIDATED
|
1
|
|
2
|
|
1
|
|
1
|
|
(2)
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended
September 30, 2020
|
|
Total(a)
|
|
Volume
|
|
Net
Price
|
|
Mix/
Other
|
|
Currency
|
|
|
Organic(b)
|
Personal
Care
|
2
|
|
4
|
|
—
|
|
2
|
|
(4)
|
|
|
6
|
Consumer
Tissue
|
11
|
|
13
|
|
1
|
|
(1)
|
|
(2)
|
|
|
13
|
K-C
Professional
|
(8)
|
|
(11)
|
|
3
|
|
2
|
|
(1)
|
|
|
(6)
|
TOTAL
CONSOLIDATED
|
3
|
|
4
|
|
1
|
|
1
|
|
(3)
|
|
|
6
|
|
|
(a)
|
Total may not equal
the sum of volume, net price, mix/other, exited businesses and
currency due to rounding.
|
(b)
|
Combined impact of
changes in volume, net price and mix/other.
|
|
|
N.M. - Not
Meaningful
|
Unaudited
|
KIMBERLY-CLARK
CORPORATION
|
NON-GAAP
RECONCILIATIONS
|
OUTLOOK FOR 2020 AND
2019 RESULTS
|
|
|
Estimated
Range
|
ESTIMATED FULL
YEAR 2020 DILUTED EARNINGS PER SHARE
|
|
|
|
|
|
Adjusted earnings per
share
|
$
|
7.50
|
|
—
|
|
$
|
7.65
|
Adjustment for
charges related to the 2018 Global Restructuring Program
|
(1.00)
|
|
—
|
|
(0.85)
|
Softex Indonesia
acquisition-related costs
|
(0.09)
|
|
—
|
|
(0.08)
|
Per share basis –
diluted net income attributable to Kimberly-Clark
Corporation
|
$
|
6.41
|
|
—
|
|
$
|
6.72
|
|
Twelve Months
Ended
December 31,
2019
|
|
FULL YEAR 2019
DILUTED EARNINGS PER SHARE
|
|
|
Adjusted earnings per
share
|
$
|
6.89
|
|
Adjustment for
charges related to the 2018 Global Restructuring Program
|
(0.72)
|
|
Adjustment related to
property sale gain
|
0.07
|
|
Per share basis –
diluted net income attributable to Kimberly-Clark
Corporation
|
$
|
6.24
|
|
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