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K-C Warns of Strong US Dollar

July 23, 2013

Personal care down but corporate sales rise overall.

During its Q2 conference call, Kimberly-Clark Corp executives warned that the stronger U.S. dollar might hurt results more than expected, even as the maker of Kleenex tissues posted a bigger-than-anticipated rise in quarterly profit.

K-C said it still expects 2013 earnings per share of $5.60 to $5.75, excluding items. The forecast includes expectations for a bigger hit from the stronger U.S. dollar, which eats into sales from international markets.

K-C reported second quarter 2013 results, updated a portion of its full-year planning assumptions and reconfirmed its previous guidance for full-year 2013 adjusted earnings per share. 
 
Second quarter 2013 net sales rose 3% to $5.3 billion. Operating profit was up 6% to $796 million.
 
In the personal care segment, sales decreased 1% to $2.4 billion. However, operating profit increased 6% to $432 million.
 
Chairman and Chief Executive Officer Thomas J. Falk said, "We delivered another solid quarter of results while we continued to execute our Global Business Plan strategies.  We achieved 3 percent organic sales growth, as excellent results in K-C International more than offset mixed volume performance in the developed markets.  We generated $80 million of cost savings, improved adjusted operating profit margin by 80 basis points and delivered an 8 percent increase in adjusted earnings per share.  We also launched a number of product innovations and continued to allocate capital in shareholder-friendly ways.  At the half way point of the year, I am encouraged by our progress overall." 
 
Falk added, "In terms of the full year, we continue to target organic sales growth of 3 to 5 percent, led by K-C International.”
 
 
 
 
 
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