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Kimberly-Clark releases 2023 results; shares outlook for 2024

January 24, 2024  By P&PC Staff/Kimberly-Clark

Kimberly-Clark reported fourth-quarter and full-year 2023 results and provided its 2024 outlook.

“We had a solid finish to 2023, delivering strong organic growth as well as cost and earnings recovery above our initial expectations,” said Kimberly-Clark chairman and CEO Mike Hsu. “Our fourth quarter results demonstrate topline momentum with more balanced growth across volume, mix and price led by strong Personal Care results. I’m proud of our team’s outstanding execution, including enhancing the value proposition of our global brands through consumer-centric innovation and stronger, more integrated commercial capabilities.”

Hsu continued, “We enter 2024 having advanced the company’s strategic foundation and financial position, and with confidence, this phase of cost recovery and supply chain stabilization is largely behind us. Moving forward, we will continue to invest in differentiating our brands and enhancing our capabilities while we maintain a disciplined cost structure in our next phase of growth. I’m confident we are positioned to accelerate and enhance the performance of our business and create meaningful shareholder value as we deliver our purpose of better care for a better world.”


Quarter highlights

  • Delivered net sales of $5 billion, in line with the prior year, with organic sales growth of three percent.
  • Gross margin was 34.9 percent, up 210 basis points versus the prior year, driven by favourable net revenue realization and productivity.
  • Diluted earnings per share were $1.50; adjusted earnings per share were $1.51, down 2 percent versus the prior year.

Full-year 2023 results

In 2023, sales of $20.4 billion increased by one percent, with organic sales up five percent, driven by an approximately six percent increase in price from ongoing revenue growth management programs and one percent from a favourable product mix, offset by a two percent decrease in volume, with sequential improvements throughout the year. Changes in foreign currency exchange rates reduced sales by three percent, and the exit of its tissue and K-C Professional business in Brazil reduced sales by one percent.

Gross margin improved by 360 basis points to 34.4 percent and adjusted gross margin improved by 370 basis points to 34.5 percent reflecting higher net revenue realization as well as cost savings from its FORCE program of $325 million more than offsetting higher input costs of $65 million and higher other manufacturing costs of $195 million.

Full-year operating profit was $2.34 billion in 2023 versus $2.68 billion in 2022. Results included non-cash impairment charges on intangible assets that were partially offset by a net benefit from the Brazil divestiture in the second quarter 2023.

Full-year adjusted operating profit was $2.96 billion in 2023 versus $2.62 billion in 2022. The increases from organic sales and benefits from productivity-led cost savings were partially offset by higher other manufacturing costs, input costs, marketing, research and general expenses, and unfavourable impact from foreign currency.

In 2023, diluted earnings per share were $5.21 compared to $5.72 last year. 2023 adjusted earnings per share were $6.57 compared to $5.63 last year.

Consumer Tissue Segment

Consumer Tissue sales of $1.5 billion decreased by one percent in the quarter, while organic sales were in line with last year reflecting price gains of one percent offset by volume decrease of one percent. Organic results were led by three percent growth in North America and one percent growth in Developed Markets. Sequential improvement in volume trends was led by North America with an increase of two percent in the quarter. For the full year, Consumer Tissue sales were up one percent with an organic increase of three percent.

Fourth-quarter operating profit of $269 million increased 13 percent driven by improved revenue realization, lower input costs, and cost savings that were partially offset by higher other manufacturing costs and an unfavorable impact from foreign currency. Operating profit for the year increased 21 percent to $976 million.

2024 Outlook

The company currently expects to deliver a low-to-mid single-digit percentage increase in 2024 organic net sales versus the prior year period, with growth in reported net sales forecast to reflect negative impacts of approximately 300 basis points from currency translation and 60 basis points from the Brazil Tissue divestiture. Adjusted operating profit is expected to grow at a high single-digit to low double-digit rate on a constant-currency basis and adjusted earnings per share are expected to grow at a high single-digit rate on a constant-currency basis versus the prior year period. Reported growth in operating profit and earnings per share are currently expected to be negatively impacted by approximately 400 basis points from currency translation.

This outlook reflects assumptions subject to change given the macro environment.

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