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Kimberly-Clark reports sales up 6% in Q4 20 results

Kimberly-Clark Corporation has reported its Q4 2020 and year-end results, citing a six per cent increase in net sales for Q4 20 over Q4 19.

That amounted to fourth-quarter 2020 net sales of $4.8 billion and organic sales growth up five per cent. Full-year 2020 net sales of $19.1 billion increased four per cent, with organic sales up six per cent.

Executive summary

Diluted net income per share for the fourth quarter was $1.58 in 2020 and $1.59 in 2019. Full-year diluted net income per share was $6.87 in 2020 and $6.24 in 2019.

Fourth quarter adjusted earnings per share (excluding certain items) were $1.69 in 2020 compared to $1.71 in 2019.

Full-year adjusted earnings per share were $7.74 in 2020, up 12 per cent compared to $6.89 in 2019. The company’s previous guidance was for adjusted earnings per share of $7.50 to $7.65.

Net sales in 2021 are expected to increase four to six per cent, including organic sales growth of one to two per cent. Diluted net income per share for 2021 is anticipated to be $7.10 to $7.60. Adjusted earnings per share in 2021 are expected to be $7.75 to $8.00.

“In 2020, we grew organic sales six per cent, with healthy underlying performance and increased demand because of COVID-19,” says Mike Hsu, chairman and CEO of Kimberly-Clark, in a statement.

“We also significantly increased brand investments and improved our market share positions. In addition, we achieved $575 million of cost savings and returned $2.15 billion to shareholders through dividends and share repurchases.

“Finally, we grew adjusted earnings per share 12 per cent, well above our medium-term objective. I’m extremely proud of what our teams accomplished while staying relentlessly focused on employee health and safety and meeting the needs of our consumers during this unprecedented time period.”

Tissue segment

Fourth quarter sales of $1.7 billion increased 14 per cent. Volumes increased nine per cent and net selling prices rose six per cent, while product mix was unfavourable by one per cent.

The volume increase was driven by demand related to the outbreak of COVID-19 and the work-from-home environment. Fourth quarter operating profit of $337 million increased 20 per cent.

Results benefited from organic sales growth and cost savings. The comparison was impacted by other manufacturing cost increases, increased advertising spending, higher input costs and increased general and administrative costs.

Sales in North America increased 21 per cent. Volumes rose 13 per cent, with bathroom tissue and paper towels up double-digits and facial tissue up mid-single digits. Net selling prices improved 11 per cent driven by lower promotion expense, while product mix was down three per cent.

Sales in D&E markets decreased two per cent including a six-point negative impact from changes in currency rates. Volumes rose three per cent and the Softex Indonesia acquisition increased sales by two per cent.

Sales in developed markets outside North America increased 12 per cent. Volumes increased six per cent, driven by South Korea, and changes in currency rates increased sales six per cent.

Read more of Kimberly-Clark’s Q4 2020 results, as well as full-year 2020 results and 2021 outlook, here.