US' Kimberly-Clark posts sales of $4.2 bn in Q3

Gross margin was 36.0 per cent in the quarter, inclusive of $34 million, or approximately 80 basis points, of charges related to the 2024 Transformation Initiative. Excluding these charges, adjusted gross margin was 36.8 per cent, down 170 basis points versus the prior year reflecting strong productivity gains that were more than offset by unfavourable pricing net of cost inflation, reflecting planned investments to improve price:value tiers across the portfolio, as well as incremental tariff-driven costs.

Third quarter operating profit was $621 million. This was inclusive of 2024 Transformation Initiative charges totaling $62 million. Excluding these charges, adjusted operating profit was $683 million, in line with the prior year as a combination of lower marketing, research and general expenses driven by efficiency gains as well as lower incentive accruals versus the prior year offset gross margin headwinds.

"The operating environment remains dynamic, but we continue to execute our strategy with discipline and excellence as we play to win," said Kimberly-Clark chairman and CEO, Mike Hsu. "We once again delivered broad-based volume-plus-mix-led growth, even while volume has been somewhat challenged in the broader industry. We held a global weighted share, reflecting the strength of our brands across geographies and the good-better-best ladder. We continued to follow through on our decisive actions to transform Kimberly-Clark into an industry-leading personal care company poised for long-term durable growth."

For the first nine months of the year, sales of $12.4 billion decreased 2.6 per cent primarily due to a 3.0 per cent negative impact from a combination of the PPE divestiture and the exit of the company's private label diaper business in the US, as well as a 1.2 per cent negative impact from foreign currency translation. Organic sales grew 1.6 per cent primarily from a 2.4 per cent increase in volume, partially offset by price investments of 0.9 per cent, while portfolio mix was broadly in line with a year ago, the company said in a press release.

For the first nine months of the year, gross margin was 36.0 per cent, inclusive of $169 million, or approximately 140 basis points, of charges related to the 2024 Transformation Initiative. Excluding these charges, adjusted gross margin was 37.4 per cent, down 130 basis points versus the prior year, as strong productivity gains were more than offset by unfavourable pricing net of cost inflation, reflecting planned investments to improve price:value tiers across the portfolio, as well as incremental tariff-related costs.

"I'm very proud of how our teams around the world are living our purpose while also positioning Kimberly-Clark to drive value for our shareholders, customers, consumers, and our communities,” Hsu continued.

ALCHEMPro News Desk (RR)