Net income for the quarter was $582 million, compared to the previous year’s $565 million.
This quarter the company initiated a restructuring program to improve organization efficiency and offset the impact of stranded overhead costs. The restructuring is expected to cost $130 million to $160 million after-tax and generate cumulative pretax savings of $120 million to $140 million.
Kimberly-Clark has four segments that reported for this quarter:
- Personal Care sales increased by 4% to $2.5 billion.
- Consumer Tissue sales increased by 4% to $1.7 billion.
- KC Professional sales increased 4% to $0.9 billion.
- Health Care sales decreased by 3% to $0.4 billion.
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Chairman and Chief Executive Officer Thomas J. Falk said:
We delivered another very good quarter of results, with solid organic sales growth, significant cost savings and margin improvement, and double-digit growth in adjusted earnings per share. We also made further progress with targeted growth initiatives, launched product innovations and supported our brands with increased advertising spending. We generated strong cash flow and continued to allocate capital in shareholder-friendly ways. I’m encouraged with our execution in a challenging environment. And our full-year guidance is consistent with our previous outlook, adjusting for the spin-off of our health care business.
Shares of Kimberly-Clark were up over 1.5% to close out Monday at $108.04. There has been practically no reaction in premarket trading. What seems to be taking place is that investors are taking a sideline view during the restructuring period.
The stock has a consensus analyst price target of $110.50 and a 52-week moving average of $98.00 to $114.45. The company has a market cap of $40 billion.
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