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Kimberly-Clark posts 1% dip in Q4 sales

31 Jan '15

4 min read

Sales in the fourth quarter ending December 31, 2014 at NYSE listed and hygiene products marketer, Kimberly-Clark Corporation fell marginally by 1 per cent year on year to $4.8 billion.

Compared to the year-ago period, organic sales rose 3 per cent, with net selling prices up 2 per cent and volumes up 1 per cent, while changes in foreign currency exchange rates reduced sales by 4 per cent.

Operating profit in the reporting quarter totaled to $158 million as against $745 million in the same quarter of 2013.

However, adjusted operating profit was $769 million in the fourth quarter of 2014 compared to $759 million in the year-ago period.

K-C said adjusted results in 2014 exclude the $462 million charge for the balance sheet re-measurement in Venezuela and $133 million in organization restructuring costs.

Other expenses excluded include, $20 million of restructuring costs for European strategic changes and $4 million of income related to an assessment regarding a regulatory dispute in the Middle East.

“Adjusted results in 2013 exclude $14 million of restructuring costs for European strategic changes,” K-C added.

According to K-C, the year-over-year adjusted operating profit comparison benefited from organic sales growth and $90 million in cost savings from its FORCE (Focused On Reducing Costs Everywhere) program.

Total marketing, research and general expenses were down versus prior-year levels, including lower administrative and advertising spending in the quarter under review.

Input costs increased $55 million overall, with $30 million of increased costs for raw materials other than fibre, $15 million of higher fibre costs and $10 million of increased distribution costs.

Foreign currency translation effects, as a result of the weakening of several currencies relative to the US dollar, reduced operating profit by $30 million.

Currency transaction effects also negatively impacted the operating profit comparison. On an adjusted basis, expense of $7 million in the fourth quarter of 2014 compared to $9 million of income in 2013.

The fourth quarter adjusted effective tax rate, which excludes the effects of the previously mentioned items excluded from adjusted earnings per share, was 30.5 per cent in 2014 down from 31.9 percent in 2013.

Kimberly-Clark's share of net income of equity companies in the fourth quarter was $33 million in 2014 as against $48 million in same quarter of the previous year.

At Kimberly-Clark de Mexico, S.A.B., results were negatively impacted by input cost increases and a weaker Mexican peso, partially offset by organic sales growth and cost savings.

The company recorded a non-deductible charge of $462 million in the fourth quarter of 2014 for the re-measurement of its December 31, 2014 bolivar-denominated net monetary assets.