UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September 30, 2015~~March 31, 2016

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

Commission file number 1-225

KIMBERLY-CLARK CORPORATION

(Exact name of registrant as specified in its charter)



Delaware		39-0394230
(State or other jurisdiction of incorporation)		(I.R.S. Employer Identification No.)

P. O. Box 619100

Dallas, Texas

75261-9100

(Address of principal executive offices)

(Zip code)

(972) 281-1200

(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.



Large accelerated filer	x	Accelerated filer	o
Non-accelerated filer	o (Do not check if a smaller reporting company)	Smaller reporting company	o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

As of ~~October 14, 2015,~~April 15, 2016, there were ~~362,994,411~~360,127,819 shares of the Corporation's common stock outstanding.

Table of Contents



PART I – FINANCIAL INFORMATION	3

Item 1. Financial Statements	3

UNAUDITED CONSOLIDATED INCOME STATEMENT FOR THE THREE ~~AND NINE~~ MONTHS ENDED ~~SEPTEMBER 30,~~MARCH 31, 2016 AND 2015 ~~AND 2014~~	3
UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE THREE ~~AND NINE~~ MONTHS ENDED ~~SEPTEMBER 30,~~MARCH 31, 2016 AND 2015 ~~AND 2014~~	4
CONSOLIDATED BALANCE SHEET AS OF ~~SEPTEMBER 30, 2015~~MARCH 31, 2016 (UNAUDITED) AND DECEMBER 31, ~~2014~~2015	5
UNAUDITED CONSOLIDATED CASH FLOW STATEMENT FOR THE ~~NINE~~THREE MONTHS ENDED ~~SEPTEMBER 30,~~MARCH 31, 2016 AND 2015 ~~AND 2014~~	6
UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS	7

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	15

Item 4. Controls and Procedures	2123

PART II – OTHER INFORMATION	2224

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	2224

Item 6. Exhibits	2325

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED INCOME STATEMENT

(Unaudited)


	Three Months Ended September 30						Nine Months Ended September 30						Three Months Ended March 31
(Millions of dollars, except per share amounts)	2015			2014			2015			2014			2016			2015
Net Sales	$	4,718		$	5,056		$	14,052		$	14,896		$	4,476		$	4,691
Cost of products sold	3,036			3,291			9,054			9,766			2,837			3,032
Gross Profit	1,682			1,765			4,998			5,130			1,639			1,659
Marketing, research and general expenses	868			904			2,586			2,738			825			849
Other (income) and expense, net	35			(16		)	1,429			29			10			62
Operating Profit	779			877			983			2,363			804			748
Interest income	4			5			12			13			4			4
Interest expense	(74		)	(72		)	(219		)	(215		)	(76		)	(72		)
Income From Continuing Operations Before Income Taxes and Equity Interests	709			810			776			2,161
Income Before Income Taxes and Equity Interests													732			680
Provision for income taxes	(217		)	(260		)	(166		)	(681		)	(207		)	(230		)
Income From Continuing Operations Before Equity Interests	492			550			610			1,480
Income Before Equity Interests													525			450
Share of net income of equity companies	37			31			112			113			35			36
Income From Continuing Operations	529			581			722			1,593
Income from discontinued operations, net of income taxes	—			1			—			65
Net Income	529			582			722			1,658			560			486
Net income attributable to noncontrolling interests in continuing operations	(12		)	(20		)	(42		)	(49		)
Net income attributable to noncontrolling interests													(15		)	(18		)
Net Income Attributable to Kimberly-Clark Corporation	$	517		$	562		$	680		$	1,609		$	545		$	468

Per Share Basis
Net Income Attributable to Kimberly-Clark Corporation
Basic													$	1.51		$	1.28
Continuing operations	$	1.42		$	1.50		$	1.87		$	4.11
Discontinued operations	—			—			—			0.17
Rounding	—			0.01			—			—
Net income	$	1.42		$	1.51		$	1.87		$	4.28

Diluted													$	1.50		$	1.27
Continuing operations	$	1.41		$	1.49		$	1.85		$	4.08
Discontinued operations	—			—			—			0.17
Rounding	—			0.01			—			—
Net income	$	1.41		$	1.50		$	1.85		$	4.25

Cash Dividends Declared	$	0.88		$	0.84		$	2.64		$	2.52		$	0.92		$	0.88

See Notes to Consolidated Financial Statements.

KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(Unaudited)


	Three Months Ended September 30						Nine Months Ended September 30						Three Months Ended March 31
(Millions of dollars)	2015			2014			2015			2014			2016			2015
Net Income	$	529		$	582		$	722		$	1,658		$	560		$	486
Other Comprehensive Income (Loss), Net of Tax
Unrealized currency translation adjustments	(531		)	(529		)	(847		)	(366		)	208			(468		)
Employee postretirement benefits	(43		)	46			818			72			(6		)	8
Other	10			30			5			19			(19		)	20
Total Other Comprehensive Income (Loss), Net of Tax	(564		)	(453		)	(24		)	(275		)	183			(440		)
Comprehensive Income (Loss)	(35		)	129			698			1,383
Comprehensive (income) loss attributable to noncontrolling interests	4			(8		)	(21		)	(45		)
Comprehensive Income (Loss) Attributable to Kimberly-Clark Corporation	$	(31	)	$	121		$	677		$	1,338
Comprehensive Income													743			46
Comprehensive income attributable to noncontrolling interests													(22		)	(15		)
Comprehensive Income Attributable to Kimberly-Clark Corporation													$	721		$	31

See Notes to Consolidated Financial Statements.

KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

(~~2015~~2016 Data is Unaudited)


(Millions of dollars)	September 30, 2015		December 31, 2014		March 31, 2016		December 31, 2015
ASSETS
Current Assets
Cash and cash equivalents	$	643	$	789	$	635	$	619
Accounts receivable, net	2,284		2,223		2,255		2,281
Inventories	1,883		1,892		1,902		1,909
Other current assets	632		655		359		617
Total Current Assets	5,442		5,559		5,151		5,426
Property, Plant and Equipment, Net	7,066		7,359		7,188		7,104
Investments in Equity Companies	279		257		284		247
Goodwill	1,435		1,628		1,498		1,446
Other Assets	706		723		699		619
TOTAL ASSETS	$	14,928	$	15,526	$	14,820	$	14,842

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Debt payable within one year	$	1,460	$	1,326	$	999	$	1,669
Trade accounts payable	2,518		2,616		2,442		2,612
Accrued expenses	1,903		1,974		1,618		1,750
Dividends payable	320		310		332		318
Total Current Liabilities	6,201		6,226		5,391		6,349
Long-Term Debt	6,125		5,630		6,904		6,106
Noncurrent Employee Benefits	1,312		1,693		1,167		1,137
Deferred Income Taxes	626		587		594		766
Other Liabilities	316		319		371		380
Redeemable Preferred Securities of Subsidiaries	72		72		64		64
Stockholders' Equity
Stockholders' Equity (Deficit)
Kimberly-Clark Corporation	54		729		109		(174		)
Noncontrolling Interests	222		270		220		214
Total Stockholders' Equity	276		999		329		40
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	14,928	$	15,526	$	14,820	$	14,842

See Notes to Consolidated Financial Statements.

KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED CASH FLOW STATEMENT

(Unaudited)


	Nine Months Ended September 30						Three Months Ended March 31
(Millions of dollars)	2015			2014			2016			2015
Operating Activities
Net income	$	722		$	1,658		$	560		$	486
Depreciation and amortization	565			655			172			194
Asset impairments	20			42
Stock-based compensation	68			51			15			15
Deferred income taxes	(378		)	57			(34		)	171
Equity companies' earnings (in excess of) less than dividends paid	(38		)	(27		)	(30		)	(35		)
(Increase) decrease in operating working capital	(316		)	(63		)	(105		)	(446		)
Postretirement benefits	941			(119		)	(16		)	(414		)
Charge for Venezuelan balance sheet remeasurement	45			—
Charge related to Venezuelan operations							—			45
Other	12			1			(9		)	4
Cash Provided by Operations	1,641			2,255			553			20
Investing Activities
Capital spending	(798		)	(730		)	(220		)	(284		)
Proceeds from sales of investments	—			96
Investments in time deposits	(100		)	(123		)	(59		)	(46		)
Maturities of time deposits	100			191			42			73
Other	(25		)	41			8			(24		)
Cash Used for Investing	(823		)	(525		)	(229		)	(281		)
Financing Activities
Cash dividends paid	(952		)	(942		)	(318		)	(310		)
Change in short-term debt	(109		)	153			(675		)	291
Debt proceeds	1,097			621			796			497
Debt repayments	(349		)	(109		)	(2		)	(4		)
Proceeds from exercise of stock options	102			98			31			41
Acquisitions of common stock for the treasury	(503		)	(1,122		)	(140		)	(248		)
Shares purchased from noncontrolling interest	(151		)	—			—			(151		)
Other	6			(22		)	(7		)	(12		)
Cash Used for Financing	(859		)	(1,323		)
Cash (Used for) Provided by Financing							(315		)	104
Effect of Exchange Rate Changes on Cash and Cash Equivalents	(105		)	(30		)	7			(45		)
Increase (Decrease) in Cash and Cash Equivalents	(146		)	377			16			(202		)
Cash and Cash Equivalents - Beginning of Year	789			1,054			619			789
Cash and Cash Equivalents - End of Period	$	643		$	1,431		$	635		$	587

See Notes to Consolidated Financial Statements.

KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1. Accounting Policies

Basis of Presentation

The accompanying unaudited Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all material adjustments which are of a normal and recurring nature necessary for a fair presentation of the results for the periods presented have been reflected. Dollar amounts are reported in millions, except per share dollar amounts, unless otherwise noted.

We completed the spin-off of our health care business on October 31, 2014. As a result, the health care business is presented as discontinued operations on the Consolidated Income Statement for all periods presented, and prior period Consolidated Income Statements and related disclosures have been recast accordingly. Segment results present net sales and operating profit by segment on a continuing operations basis. Other comprehensive income and cash flows of the health care business are included within our Consolidated Statement of Comprehensive Income and Consolidated Cash Flow Statement, respectively, for the three and nine months ended September 30, 2014, as applicable.

For further information, refer to the Consolidated Financial Statements and footnotes included in our Annual Report on Form ~~10-K~~10‑K for the year ended December 31, ~~2014.~~2015. The terms "Corporation," "Kimberly-Clark," "K-C," "we," "our" and "us" refer to Kimberly-Clark Corporation and its consolidated subsidiaries.

~~Annual Goodwill Impairment Assessment~~

Goodwill represents costs in excess of fair values assigned to the underlying net assets of acquired businesses. Goodwill is not amortized, but rather is assessed for impairment annually and whenever events and circumstances indicate that impairment may have occurred. Impairment testing compares the reporting unit carrying amount of goodwill with its fair value. If the reporting unit carrying amount of goodwill exceeds its fair value, an impairment charge would be recorded. In our evaluation of goodwill impairment, we have the option to first assess qualitative factors such as macroeconomic, industry and competitive conditions, legal and regulatory environment, historical and projected financial performance, significant changes in the reporting unit and the magnitude of excess fair value over carrying amount from the previous quantitative impairment testing. If the qualitative assessment determines that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then a quantitative impairment test using discounted cash flows to estimate fair value must be performed. On the other hand, if the qualitative assessment determines that it is more likely than not that the fair value of a reporting unit is more than its carrying value, then further quantitative testing is not required. For 2015, we have completed the required annual assessment of goodwill for impairment for all of our reporting units using a qualitative assessment as of the first day of the third quarter, and have determined that it is more likely than not that the fair value is more than the carrying amount for each of our reporting units.

~~Highly Inflationary~~ Accounting for Venezuelan Operations

~~We account~~Effective December 31, 2015, we deconsolidated the assets and liabilities of our business in Venezuela from our consolidated balance sheet and moved to the cost method of accounting for our operations in ~~Venezuela using highly inflationary accounting. Since February 2013,~~that country. The change resulted in the ~~Central Bank~~recognition of ~~Venezuela's regulated currency exchange system rate has been 6.3 bolivars per U.S. dollar. During March 2013,~~an after tax charge of $102 in the ~~Venezuelan government announced a complementary currency exchange system, SICAD. In February 2014, the president~~fourth quarter of Venezuela announced that another floating rate exchange system (referred to as SICAD II) would be initiated. On February 10, 2015, the Venezuelan government announced the addition of a new foreign currency exchange system referred to as the Marginal Currency System, or SIMADI, along with the elimination2015. As of the ~~SICAD II system.~~

~~We have historically measured~~first quarter of 2016, we no longer include the results of our Venezuelan business in ~~Venezuela at the rate in which we transact~~ our ~~business. We have qualified for access~~consolidated financial statements. Prior to the official exchange rate because we manufacture and sell price-controlled products. Since March 2013, exchange transactions have taken place through letters of credit which resulted in an effective exchange rate of 6.3 bolivars per U.S. dollar and through approved transactions using the regulated currency exchange system, which were also at a 6.3 exchange rate. To date, we have not been invited to participate in SICAD, and currency exchanges obtained using the SIMADI system have been minimal. The SIMADI exchange rate at September 30, 2015 was 199 bolivars per U.S. dollar.

We continued to measure results at the 6.3 rate through December 31, 2014, however, given the level of uncertainty and lack of liquidity in Venezuela, we remeasured our local currency-denominated balance sheet as of December 31, 2014 at the year-end floating SICAD II exchange rate of 50 bolivars per U.S. dollar as we believed this was the most accessible rate available in the

~~absence of exchange at 6.3 bolivars per U.S. dollar. This remeasurement resulted in a non-deductible charge of $462 in the Consolidated Income Statement for the year ended December 31, 2014.~~

~~With the elimination of SICAD II~~deconsolidation, in February 2015 we remeasured our local currency-denominated balance sheet ~~during the first quarter of 2015~~ at the applicable floating SIMADI exchange rate (193 bolivars per U.S. dollar at March 31, 2015) as we ~~believe~~believed this iswas the most accessible rate available to us in the absence of exchange at 6.3 bolivars per U.S. dollar. This remeasurement resulted in a non-deductible charge of $45 in the Consolidated Income Statement for the three months ended March 31, 2015, with $5 recorded in cost of products sold and $40 recorded in other (income) and expense, net. ~~Remeasurement charges since March 31, 2015 have not been significant.~~

We continue to manufacture and sell products in Venezuela, as well as import raw materials and finished goods to the extent we are able to obtain foreign exchange transactions. Approval for exchange transactions using the regulated currency exchange system for raw materials have slowed in the current year, which has continued to result in curtailment of production at various times through September 30, 2015. We have also been unable to obtain approval for recent requests for price increases for our regulated products. At September 30, 2015, our net investment in K-C Venezuela was approximately $100, and the bolivar-denominated net monetary asset position was not significant. Net sales of ~~K-C~~K‑C Venezuela ~~represented less than 1 percent and 3 percent~~were insignificant in 2015.

Balance Sheet Classification of ~~consolidated net sales for the nine months ended September 30, 2015 and 2014, respectively.~~

~~New Accounting Standards~~Deferred Taxes

In ~~July~~ 2015, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No. ~~2015-11,~~2015-17, ~~Simplifying~~Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. Under this ASU, a reporting entity is required to classify all deferred tax assets and liabilities as noncurrent in a classified balance sheet. Current guidance requiring the ~~Measurement~~offsetting of ~~Inventory~~deferred tax assets and liabilities of a tax-paying component of an entity and presentation as a single noncurrent amount is not affected. We early adopted this ASU prospectively, and our March 31, 2016 consolidated balance sheet reflects the new guidance for classification of deferred taxes. Prior periods were not recasted.

New Accounting Standards

In 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718). The new guidance simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. For public companies, the amendments in this standard are effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Early adoption is permitted. The effects of this standard on our financial position, results of operations and cash flows are not expected to be material.

In 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). Under the new guidance, a lessee will be required to recognize assets and liabilities for all leases with lease terms of more than 12 months. Consistent with current GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. The ASU requires additional disclosures. The standard is effective for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The ASU requires adoption based upon a modified retrospective transition approach. Early adoption is permitted. The effects of this standard on our financial position, results of operations and cash flows are not yet known.

In 2015, the FASB issued ASU No. 2015-07, Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent), which amends ASC 820, Fair Value Measurement. This ASU ~~changes~~removes the ~~measurement principle for inventories valued under~~requirement to categorize within the ~~First-In, First-Out ("FIFO")~~fair value hierarchy investments without readily determinable fair values in entities that elect to measure fair value using net asset value per share or ~~weighted-average methods from~~its equivalent. The ASU requires that sufficient information be provided to permit reconciliation of the ~~lower~~fair value of ~~cost or market~~assets categorized within the fair value hierarchy to the ~~lower of cost and net realizable value. Net realizable value is defined by the FASB as estimated selling prices~~amounts presented in the ~~ordinary course~~statement of business, less reasonably predictable costs of completion, disposal and transportation. This ASU does not change the measurement principles for inventories valued under the Last-In, First-Out ("LIFO") method. financial position.

We adopted this ASU ~~on September 30, 2015.~~in the first quarter of 2016 retrospectively. The adoption of this ~~ASU~~standard did not have a material ~~effect~~impact on our ~~Consolidated Financial Statements.~~ financial position, results of operations and cash flows.

In ~~May~~ 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which provides a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and will supersede most current revenue recognition guidance. In 2016, the FASB issued two amendments to the ASU. The standard is effective for public ~~entities~~companies for annual and interim periods beginning after December 15, 2017. Early adoption is permitted as of one year prior to the current effective date. The guidance permits two implementation approaches, one requiring retrospective application of the new standard with restatement of prior years and one requiring prospective application of the new standard with disclosure of results under old standards. The effects of this standard on our financial position, results of operations and cash flows are not yet known.

Note 2. 2014 Organization Restructuring

In ~~October~~ 2014, we initiated a restructuring plan in order to improve organization efficiency and offset the impact of stranded overhead costs resulting from the spin-off of our health care business. The restructuring is intended to improve our underlying profitability and increase our flexibility to invest in targeted growth initiatives, brand building and other capabilities critical to delivering future growth. The plan is expected to be completed by the end of 2016, with total costs, primarily severance, anticipated to be toward the high end of the range of $130 to $160 after tax ($190 to $230 ~~pre-tax)~~pretax). Cash costs are projected to be approximately 80 percent of the total charges. The restructuring is expected to impact all of our business segments and our organizations in all major geographies.

~~The following~~Total pretax charges were ~~incurred in connection with~~$14 ($10 after tax) and $13 ($5 after tax) for the ~~restructuring:~~

Three Months Ended
September 30, 2015 Nine Months Ended
September 30, 2015
Cost of products sold $ 4
$ 19
Marketing, research and general expenses 7
17
Provision for income taxes (4 ) (16 )
Net charges $ 7
$ 20

three months ended March 31, 2016 and 2015, respectively. Through ~~September 30, 2015,~~March 31, 2016, cumulative ~~pre-tax~~pretax charges for the restructuring were ~~$169~~$210 ($~~115~~147 after tax)~~, including cumulative pre-tax cash charges of $135.~~. Cash payments during the ~~nine~~three months ended ~~September 30,~~March 31, 2016 and 2015 related to the restructuring were ~~$65.~~$24 and $31, respectively.

Note 3. Fair Value Information

The following fair value information is based on a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The three levels in the hierarchy used to measure fair value are:

Level 1 – Unadjusted quoted prices in active markets accessible at the reporting date for identical assets and liabilities.

Level 2 – Quoted prices for similar assets or liabilities in active markets. Quoted prices for identical or similar assets and liabilities in markets that are not considered active or financial instruments for which all significant inputs are observable, either directly or indirectly.

Level 3 – Prices or valuations that require inputs that are significant to the valuation and are unobservable.

A financial instrument's level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

During the ~~nine~~three months ended ~~September 30, 2015~~March 31, 2016 and for the full year ~~2014,~~2015, there were no significant transfers among level 1, 2, or 3 fair value determinations.

Company-owned life insurance ("COLI") assets and derivative assets and liabilities are measured on a recurring basis at fair value. COLI assets were ~~$55 and $58~~$57 at ~~September 30, 2015~~both March 31, 2016 and December 31, ~~2014, respectively.~~2015. The COLI policies are a source of funding primarily for our nonqualified employee benefits and are included in other assets. The fair value amount of the COLI policies is ~~considered a~~measured at fair value using the net asset value per share practical expedient, and therefore, is not classified in the fair value hierarchy under the ASU adopted in the first quarter of 2016 as discussed in Note 1.

In addition, in our Form 10-K for the year-ended December 31, 2015, we disclosed the fair value as of December 31, 2015 and 2014 of the pension assets in our Principal Plans (U.S. and United Kingdom) as $241 and $161 in level 1 and $2.8 billion and $5.4 billion in level 2, ~~measurement~~respectively, and ~~is derived from investments~~none in ~~a mix~~level 3. Approximately $8 of ~~money market, fixed income~~level 1 at December 31, 2014, and ~~equity funds managed by unrelated fund managers.~~ $2.7 billion and $2.9 billion at December 31, 2015 and 2014, respectively of the level 2 pension assets, were measured at fair value using the net asset value per share practical expedient, and therefore, will no longer be classified in the fair value hierarchy under the ASU adopted in first quarter of 2016 as discussed in Note 1.

At ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014,~~2015, derivative assets were ~~$76~~$67 and ~~$54,~~$56, respectively, and derivative liabilities were ~~$83~~$53 and ~~$116,~~$42, respectively. The fair values of derivatives used to manage interest rate risk and commodity price risk are based on LIBOR rates and interest rate swap curves and NYMEX price quotations, respectively. The fair value of hedging instruments used to manage foreign currency risk is based on published quotations of spot currency rates and forward points, which are converted into implied forward currency rates. Measurement of our derivative assets and liabilities is considered a level 2 measurement. Additional information on our classification and use of derivative instruments is contained in Note 7.

Redeemable preferred securities of subsidiaries are measured on a recurring basis at fair value and were $64 at both March 31, 2016 and December 31, 2015. They are not traded in active markets. For certain redeemable securities, fair values were calculated using a floating rate pricing model that compared the stated spread to the fair value spread to determine the price at which each of the financial instruments should trade. The model used the following inputs to calculate fair values: face value, current LIBOR rate, unobservable fair value credit spread, stated spread, maturity date and interest or dividend payment dates. The fair value of the remaining redeemable securities was based on various inputs, including an independent third-party appraisal, adjusted for current market conditions. Measurement of the redeemable preferred securities is considered a level 3 measurement.

The following table includes the fair value of our financial instruments for which disclosure of fair value is required:


	Fair Value Hierarchy Level	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value		Fair Value Hierarchy Level	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
		September 30, 2015				December 31, 2014					March 31, 2016				December 31, 2015
Assets
Cash and cash equivalents^(a)	1	$	643	$	643	$	789	$	789	1	$	635	$	635	$	619	$	619
Time deposits and other^(b)	1	150		150		130		130		1	135		135		124		124
Liabilities and redeemable securities of subsidiaries
Short-term debt^(c)	2	659		659		777		777		2	400		400		1,071		1,071
Long-term debt^(d)	2	6,926		7,540		6,179		6,963		2	7,503		8,267		6,704		7,300
Redeemable preferred securities of subsidiaries^(e)	3	72		72		72		72


(a)	Cash equivalents are composed of certificates of deposit, time deposits and other interest-bearing investments with original maturity dates of 90 days or less. Cash equivalents are recorded at cost, which approximates fair value.

(b)

Time deposits are composed of deposits with original maturities of more than 90 days but less than one year and instruments with original maturities of greater than one year, included in other current assets or other assets in the Consolidated Balance Sheet, as appropriate. Other, included in other current assets, is composed of funds held in escrow. Time deposits and other are recorded at cost, which approximates fair value.


(c)	Short-term debt is composed of U.S. commercial paper and/or other similar short-term debt issued by non-U.S. subsidiaries, all of which are recorded at cost, which approximates fair value.


(d)	Long-term debt includes the current portion of these debt instruments. Fair values were estimated based on quoted prices for financial instruments for which all significant inputs were observable, either directly or indirectly.

~~(e)~~

The redeemable preferred securities of subsidiaries are not traded in active markets. For certain instruments, fair values were calculated using a floating rate pricing model that compared the stated spread to the fair value spread to determine the price at which each of the financial instruments should trade. The model used the following inputs to calculate fair values: face value, current LIBOR rate, unobservable fair value credit spread, stated spread, maturity date and interest or dividend payment dates. Additionally, the fair value of the remaining redeemable securities was based on various inputs, including an independent third-party appraisal, adjusted for current market conditions.

Note 4. Employee Postretirement Benefits

The table below presents net periodic benefit cost information for defined benefit plans and other postretirement benefit plans:


	Pension Benefits						Other Benefits				Pension Benefits						Other Benefits
	Three Months Ended September 30										Three Months Ended March 31
	2015			2014			2015		2014		2016			2015			2016		2015
Service cost	$	10		$	12		$	3	$	3	$	14		$	10		$	3	$	4
Interest cost	39			70			8		9		38			64			8		8
Expected return on plan assets	(43		)	(83		)	—		—		(41		)	(75		)	—		—
Recognized net actuarial loss	13			25			—		—		13			29			—		—
Settlements	19			—			—		—		—			9			—		—
Other	(2		)	1			—		—		(3		)	(5		)	—		—
Net periodic benefit cost	$	36		$	25		$	11	$	12	$	21		$	32		$	11	$	12

Pension Benefits Other Benefits
Nine Months Ended September 30
2015 2014 2015 2014
Service cost $ 29
$ 36
$ 9
$ 9
Interest cost 148
209
25
27
Expected return on plan assets (173 ) (249 ) —
—
Recognized net actuarial loss 61
75
(1 ) —
Settlements 1,348
—
—
—
Other (9 ) 6
—
—
Net periodic benefit cost $ 1,404
$ 77
$ 33
$ 36

For the three months ended March 31, 2016 and 2015, we made cash contributions of $30 and $435, respectively, to our pension trusts. We expect to contribute up to $100 to our defined benefit pension plans for the full year 2016. Effective January 2015, the U.S. pension plan was amended to include a lump-sum pension benefit payout option for certain plan participants. In addition, in April 2015, the U.S. pension plan completed the purchase of group annuity contracts that transferred to two insurance companies the pension benefit obligations totaling $2.5 billion for approximately 21,000 Kimberly-Clark retirees in the United States. In connection with these transactions, during the first quarter of 2015 we made a $410 contribution to our U.S. pension plan in order to maintain the plan’s funded status. As a result of these changes, we recognized ~~charges related to~~ pension ~~settlements~~settlement-related charges of $0.8 billion after tax ($1.4 billion ~~pre-tax~~pretax in other (income) and expense, net) during ~~the nine months ended September 30,~~ 2015, mostly in the second quarter.

For the nine months ended September 30, 2015, we made cash contributions of $437 to our pension trusts, of which $410 relates to the changes above. In total we expect to contribute $440 to $500 to our defined benefit pension plans for the full year 2015. For the nine months ended September 30, 2014, we made cash contributions of $180 to our pension trusts.

Note 5. Earnings Per Share ("EPS")

There are no adjustments required to be made to net income for purposes of computing EPS. A reconciliation of the average number of common shares outstanding used in the basic and diluted EPS computations follows:


	Three Months Ended September 30		Nine Months Ended September 30		Three Months Ended March 31
(Millions of shares)	2015	2014	2015	2014	2016	2015
Basic	363.9	373.3	364.5	376.0	360.7	365.2
Dilutive effect of stock options	0.9	1.1	0.9	1.2
Dilutive effect of restricted share and restricted share unit awards	1.4	1.5	1.5	1.6
Dilutive effect of stock options and restricted share unit awards					2.7	2.7
Diluted	366.2	375.9	366.9	378.8	363.4	367.9

~~There~~Options outstanding that were ~~no significant outstanding stock-based awards excluded from~~not included in the computation of diluted EPS ~~during~~because their exercise price was greater than the ~~three and nine month periods ended September 30, 2015 and 2014.~~average market price of the common shares were insignificant.

The number of common shares outstanding as of ~~September 30,~~March 31, 2016 and 2015 ~~and 2014~~ was ~~363.3~~360.2 million and ~~372.5~~364.3 million, respectively.

Note 6. Stockholders' Equity (Deficit)

Set forth below is a reconciliation for the ~~nine~~three months ended ~~September 30, 2015~~March 31, 2016 of the carrying amount of total stockholders' equity (deficit) from the beginning of the period to the end of the period.


	Stockholders' Equity Attributable to						Stockholders' Equity (Deficit) Attributable to
	The Corporation			Noncontrolling Interests			The Corporation			Noncontrolling Interests
Balance at December 31, 2014	$	729		$	270
Balance at December 31, 2015							$	(174	)	$	214
Net Income	680			38			545			14
Other comprehensive income, net of tax
Unrealized translation	(825		)	(22		)	200			8
Employee postretirement benefits	817			1			(5		)	(1		)
Other	5			—			(19		)	—
Stock-based awards exercised or vested	101			—			30			—
Recognition of stock-based compensation	68			—			15			—
Income tax benefits on stock-based compensation	26			—			9			—
Shares repurchased	(483		)	—			(160		)	—
Dividends declared	(962		)	(19		)	(332		)	(16		)
Other	(102		)	(46		)	—			1
Balance at September 30, 2015	$	54		$	222
Balance at March 31, 2016							$	109		$	220

During the ~~nine~~three months ended ~~September 30, 2015,~~March 31, 2016, we repurchased ~~4.1~~1.1 million shares at a total cost of ~~$450.~~$150pursuant to a share repurchase program authorized by our Board of Directors.

Net unrealized currency gains or losses resulting from the translation of assets and liabilities of foreign subsidiaries, except those in highly inflationary economies, are recorded in accumulated other comprehensive income ("AOCI"). For these operations, changes in exchange rates generally do not affect cash flows; therefore, unrealized translation is recorded in AOCI rather than net income. Upon sale or substantially complete liquidation of any of these subsidiaries, the applicable unrealized translation would be removed from AOCI and reported as part of the gain or loss on the sale or liquidation.

Also included in unrealized translation are the effects of foreign exchange rate changes on intercompany balances of a long-term investment nature and transactions designated as hedges of net foreign investments.

The change in net unrealized currency translation for the ~~nine~~three months ended ~~September 30, 2015~~March 31, 2016 was primarily due to the ~~strengthening~~weakening of the U.S. dollar versus most foreign currencies, including the Australian dollar, Brazilian real, ~~Australian dollar,~~the euro, the South Korean won ~~Colombian peso, Canadian dollar~~ and the ~~euro.~~Canadian dollar.

The changes in the components of AOCI attributable to Kimberly-Clark, net of tax, are as follows:


	Unrealized Translation			Defined Benefit Pension Plans				Other Postretirement Benefit Plans				Cash Flow Hedges and Other
Balance as of December 31, 2013	$	(525	)	$	(1,668	)		$	(15	)		$	(34	)
Other comprehensive income (loss) before reclassifications	(362		)	(2		)		24				17
(Income) loss reclassified from AOCI	—			49			(a)	1			(a)	2
Net current period other comprehensive income (loss)	(362		)	47				25				19
Balance as of September 30, 2014	$	(887	)	$	(1,621	)		$	10			$	(15	)
															Unrealized Translation			Defined Benefit Pension Plans				Other Postretirement Benefit Plans			Cash Flow Hedges and Other
Balance as of December 31, 2014	$	(1,335	)	$	(1,924	)		$	(37	)		$	(16	)	$	(1,335	)	$	(1,924	)		$	(37	)	$	(16	)
Other comprehensive income (loss) before reclassifications	(825		)	(56		)		10				44			(465		)	(8		)		2			37
(Income) loss reclassified from AOCI	—			864			(a)	(1		)	(a)	(39		)	—			14			(a)	—			(17		)
Net current period other comprehensive income (loss)	(825		)	808				9				5			(465		)	6				2			20
Other	(12		)	—				—				1
Balance as of September 30, 2015	$	(2,172	)	$	(1,116	)		$	(28	)		$	(10	)
Shares purchased from noncontrolling interest and other															(12		)	—				—			—
Balance as of March 31, 2015															$	(1,812	)	$	(1,918	)		$	(35	)	$	4

Balance as of December 31, 2015															$	(2,252	)	$	(1,013	)		$	(3	)	$	(10	)
Other comprehensive income (loss) before reclassifications															200			(12		)		—			(13		)
(Income) loss reclassified from AOCI															—			7			(a)	—			(6		)
Net current period other comprehensive income (loss)															200			(5		)		—			(19		)
Balance as of March 31, 2016															$	(2,052	)	$	(1,018	)		$	(3	)	$	(29	)


(a)	Included in computation of net periodic pension ~~and postretirement benefits~~ costs (see Note 4).

During the first quarter of 2015, we acquired the remaining 49.9 percent interest in our subsidiary in Israel, Hogla-Kimberly, Ltd., for $151. As our subsidiary in Turkey was wholly-owned by our subsidiary in Israel, through this acquisition we also effectively acquired the remaining 49.9 percent interest in our subsidiary in Turkey, Kimberly-Clark Tuketim Mallari Sanayi ve Ticaret A.s. ~~The acquisition was recorded as an equity transaction that reduced noncontrolling interests, AOCI and additional paid-in capital by $45, $12 and $94, respectively.~~

The purchase of additional ownership in an already controlled subsidiary is treated as an equity transaction with no gain or loss recognized in consolidated net income or comprehensive income. The effect of the change in ownership interest is as follows:

Nine Months Ended September 30, 2015
Net Income attributable to Kimberly-Clark Corporation $ 680
Decrease in Kimberly-Clark Corporation's additional paid-in capital for acquisition (94 )
Change from net income attributable to Kimberly-Clark Corporation and transfers to noncontrolling interest $ 586



	Three Months Ended March 31, 2015
Net income attributable to Kimberly-Clark Corporation	$	468
Decrease in Kimberly-Clark Corporation's additional paid-in capital for acquisition	(94		)
Change from net income attribution to Kimberly-Clark Corporation and transfers to noncontrolling interests	$	374

Note 7. Objectives and Strategies for Using Derivatives

As a multinational enterprise, we are exposed to financial risks, such as changes in foreign currency exchange rates, interest rates, and commodity prices. We employ a number of practices to manage these risks, including operating and financing activities and, where appropriate, the use of derivative instruments. We enter into derivative instruments to hedge a portion of forecasted cash flows denominated in foreign currencies for non-U.S. operations' purchases of raw materials, which are priced in U.S. dollars, and imports of intercompany finished goods and work-in-process priced predominantly in U.S. dollars and euros. The derivative instruments used to manage these exposures are designated and qualify as cash flow hedges. The foreign currency exposure on certain non-functional currency denominated monetary assets and liabilities, primarily intercompany loans and accounts payable, is hedged with primarily undesignated derivative instruments.

Interest rate risk is managed using a portfolio of variable- and fixed-rate debt composed of short- and long-term instruments. Interest rate swap contracts may be used to facilitate the maintenance of the desired ratio of variable- and fixed-rate debt and are designated and qualify as fair value hedges. From time to time, we also hedge the anticipated issuance of fixed-rate debt, using forward-starting swaps, and these contracts are designated as cash flow hedges.

We use derivative instruments, such as forward swap contracts, to hedge a limited portion of our exposure to market risk arising from changes in prices of certain commodities. These derivatives are designated as cash flow hedges of specific quantities of the underlying commodity expected to be purchased in future months.

Translation adjustments result from translating foreign entities' financial statements into U.S. dollars from their functional currencies. The risk to any particular entity's net assets is reduced to the extent that the entity is financed with local currency borrowing. Translation exposure, which results from changes in translation rates between functional currencies and the U.S. dollar,

generally is not hedged. However, consistent with other years, a portion of our net investment in our Mexican affiliate has been hedged. At ~~September 30, 2015,~~March 31, 2016, we had in place net investment hedges of ~~$68~~$120 for a portion of our investment in our Mexican affiliate.

Set forth below is a summary of the ~~total~~ designated and undesignated fair values of our derivative instruments:


	Assets				Liabilities				Assets				Liabilities
	September 30, 2015		December 31, 2014		September 30, 2015		December 31, 2014		March 31, 2016		December 31, 2015		March 31, 2016		December 31, 2015
Foreign currency exchange contracts	$	69	$	54	$	68	$	102	$	67	$	56	$	40	$	27
Interest rate contracts	7		—		—		4
Commodity price contracts	—		—		15		10		—		—		13		15
Total	$	76	$	54	$	83	$	116	$	67	$	56	$	53	$	42

The derivative assets are included in the Consolidated Balance Sheet in other current assets and other assets, as appropriate. The derivative liabilities are included in the Consolidated Balance Sheet in accrued expenses and other liabilities, as appropriate.

Derivative instruments that are designated and qualify as fair value hedges are predominantly used to manage interest rate risk. The fair values of these derivative instruments are recorded as an asset or liability, as appropriate, with the offset recorded in current earnings. The offset to the change in fair values of the related hedged items also is recorded in current earnings. Any realized gain or loss on the derivatives that hedge interest rate risk is amortized to interest expense over the life of the related debt.

At ~~September 30, 2015,~~March 31, 2016, the aggregate notional values of outstanding interest rate contracts designated as fair value hedges were ~~$500.~~ $375. Fair value hedges resulted in no significant ineffectiveness in the ~~nine~~three months ended ~~September 30, 2015~~March 31, 2016 and ~~2014~~. 2015. For the three months ended March 31, 2016 and ~~nine month periods ended September 30,~~ 2015, ~~and 2014,~~ gains or losses recognized in interest expense for interest rate swaps were not significant. For the ~~nine~~three month periods ended ~~September 30,~~March 31, 2016 and 2015, ~~and 2014,~~ no gain or loss was recognized in earnings as a result of a hedged firm commitment no longer qualifying as a fair value hedge.

For derivative instruments that are designated and qualify as cash flow hedges, the effective portion of the gain or loss on the derivative instrument is initially recorded in AOCI, net of related income taxes, and recognized in earnings in the same period that the hedged exposure affects earnings. As of ~~September 30, 2015,~~March 31, 2016, outstanding commodity forward contracts were in place to hedge a limited portion of our estimated requirements of the related underlying commodities in the remainder of ~~2015~~2016 and future periods. As of ~~September 30, 2015,~~March 31, 2016, the aggregate notional value of outstanding foreign exchange derivative contracts designated as cash flow hedges was ~~$820,~~$787, and there were no outstanding interest rate derivative contracts designated as cash flow hedges. Cash flow hedges resulted in no significant ineffectiveness for the ~~nine~~three months ended ~~September 30,~~March 31, 2016 and 2015 ~~and 2014~~. For the ~~nine~~three months ended ~~September 30,~~March 31, 2016 and 2015, ~~and 2014,~~ no gains or losses were reclassified into earnings as a result of the discontinuance of cash flow hedges due to the original forecasted transaction no longer being probable of occurring. At ~~September 30, 2015,~~March 31, 2016, amounts to be reclassified from AOCI during the next twelve months are not expected to be material. The maximum maturity of cash flow hedges in place at ~~September 30, 2015~~March 31, 2016 is December 2018.

Gains or losses on undesignated foreign exchange hedging instruments are immediately recognized in other (income) and expense, net. ~~Losses~~A gain of ~~$77~~$28 and ~~$130~~a loss of $155 were recorded in the three month periods ended ~~September 30,~~March 31, 2016 and 2015, ~~and 2014, respectively. Losses of $158 and $77 were recorded in the nine month periods ended September 30, 2015 and 2014,~~ respectively. The effect on earnings from the use of these non-designated derivatives is substantially neutralized by the transactional gains and losses recorded on the underlying assets and liabilities. At ~~September 30, 2015,~~March 31, 2016, the notional amount of these undesignated derivative instruments was ~~$2.7~~$1.8 billion.

Note 8. Business Segment Information

We are organized into operating segments based on product groupings. These operating segments have been aggregated into three reportable global business segments: Personal Care, Consumer Tissue and K-C Professional. The reportable segments were determined in accordance with how our executive managers develop and execute global strategies to drive growth and profitability. These strategies include global plans for branding and product positioning, technology, research and development programs, cost reductions including supply chain management, and capacity and capital investments for each of these businesses. Segment management is evaluated on several factors, including operating profit. Segment operating profit excludes other (income) and expense, net and income and expense not associated with the business segments.

The principal sources of revenue in each global business segment are described below:

Personal Care brands offer ~~parents~~our consumers a trusted partner in caring for themselves and their families ~~and deliver~~by delivering confidence, protection and discretion ~~to adults~~ through a wide variety of innovative solutions and products such as disposable diapers, training and youth pants, swimpants, baby wipes, feminine and incontinence care products, and other related products. Products in this segment are sold under the Huggies, Pull-Ups, Little Swimmers, GoodNites, DryNites, Kotex, U by Kotex, Intimus, Depend, Plenitud, Poise and other brand names.

Consumer Tissue offers a wide variety of innovative solutions and trusted brands that touch and improve people's lives every day. Products in this segment include facial and bathroom tissue, paper towels, napkins and related products, and are sold under the Kleenex, Scott, Cottonelle, Viva, Andrex, Scottex, Neve and other brand names.

K-C Professional~~helps transform workplaces for employees and patrons, making~~ partners with businesses to create Exceptional Workplaces, helping to make them healthier, safer and more productive through a range of solutions and supporting products such as wipers, tissue, towels, apparel, ~~wipers,~~ soaps ~~sanitizers, tissue~~ and ~~towels. Key~~sanitizers. Our brands, ~~in this segment include~~including Kleenex, Scott, WypAll, Kimtech and Jackson~~Safety.~~ Safety, are well-known for quality and trusted to help people around the world work better.

The following schedules present information concerning consolidated operations by business segment:


	Three Months Ended September 30								Nine Months Ended September 30								Three Months Ended March 31
	2015			2014			Change		2015			2014			Change		2016			2015			Change
NET SALES
Personal Care	$	2,357		$	2,475		-4.8	%	$	6,971		$	7,299		-4.5	%	$	2,207		$	2,308		-4.4	%
Consumer Tissue	1,528			1,697			-10.0	%	4,601			5,024			-8.4	%	1,496			1,574			-5.0	%
K-C Professional	826			873			-5.4	%	2,443			2,531			-3.5	%	763			795			-4.0	%
Corporate & Other	7			11			N.M.		37			42			N.M.		10			14			N.M.
TOTAL NET SALES	$	4,718		$	5,056		-6.7	%	$	14,052		$	14,896		-5.7	%	$	4,476		$	4,691		-4.6	%

OPERATING PROFIT
Personal Care	$	484		$	483		+0.2	%	$	1,412		$	1,393		+1.4	%	$	449		$	455		-1.3	%
Consumer Tissue	260			285			-8.8	%	811			782			+3.7	%	280			291			-3.8	%
K-C Professional	154			165			-6.7	%	433			453			-4.4	%	150			134			+11.9	%
Corporate & Other	(84		)	(72		)	N.M.		(244		)	(236		)	N.M.		(65		)	(70		)	N.M.
Other (income) and expense, net^(a)	35			(16		)	N.M.		1,429			29			N.M.		10			62			-83.9	%
TOTAL OPERATING PROFIT	$	779		$	877		-11.2	%	$	983		$	2,363		-58.4	%	$	804		$	748		+7.5	%

N.M. - Not Meaningful

~~(a)~~

Other (income) and expense, net includes charges related to pension settlements of $19 and $1,350 for the three and nine months ended September 30, 2015, respectively, and a charge related to the remeasurement of the Venezuelan balance sheet of $40 for the nine months ended September 30, 2015. In addition, other (income) and expense, net includes a $39 charge related to a regulatory dispute in the Middle East for the nine months ended September 30, 2014.

Note 9. Supplemental Balance Sheet Data

The following schedule presents a summary of inventories by major class:


	September 30, 2015								December 31, 2014								March 31, 2016								December 31, 2015
	LIFO			Non-LIFO		Total			LIFO			Non-LIFO		Total
(Summary of Inventories by Major Class)																	LIFO			Non-LIFO		Total			LIFO			Non-LIFO		Total
Raw materials	$	103		$	299	$	402		$	104		$	322	$	426		$	99		$	286	$	385		$	100		$	297	$	397
Work-in-process	119			99		218			120			95		215
Work in process																	113			98		211			110			93		203
Finished goods	488			681		1,169			511			672		1,183			499			705		1,204			525			689		1,214
Supplies and other	—			278		278			—			288		288			—			283		283			—			278		278
	710			1,357		2,067			735			1,377		2,112			711			1,372		2,083			735			1,357		2,092
Excess of FIFO or weighted-average cost over LIFO cost	(184		)	—		(184		)	(220		)	—		(220		)	(181		)	—		(181		)	(183		)	—		(183		)
Total	$	526		$	1,357	$	1,883		$	515		$	1,377	$	1,892		$	530		$	1,372	$	1,902		$	552		$	1,357	$	1,909

Inventories are valued at the lower of cost and net realizable value, determined on the FIFO or weighted-average cost methods, and at the lower of cost or market, determined on the LIFO cost method.

The following schedule presents a summary of property, plant and equipment, net:


	September 30, 2015			December 31, 2014			March 31, 2016			December 31, 2015
Land	$	166		$	177		$	166		$	164
Buildings	2,535			2,574			2,583			2,537
Machinery and equipment	13,280			13,437			13,583			13,393
Construction in progress	494			591			427			453
	16,475			16,779			16,759			16,547
Less accumulated depreciation	(9,409		)	(9,420		)	(9,571		)	(9,443		)
Total	$	7,066		$	7,359		$	7,188		$	7,104


Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations

Introduction

This management's discussion and analysis of financial condition and results of operations is intended to provide investors with an understanding of our recent performance, financial condition and prospects. The following will be discussed and analyzed:

Overview of ~~Third~~First Quarter ~~2015~~2016 Results

Results of Operations and Related Information

Liquidity and Capital Resources

Legal Matters

Business Outlook

We describe our business outside North America in two groups – Developing and Emerging Markets ("D&E") and Developed Markets. D&E markets comprise Eastern Europe, the Middle East and Africa, Latin America and Asia-Pacific, excluding Australia and South Korea. Developed Markets consist of Western and Central Europe, Australia and South Korea.

Throughout this MD&A, we refer to financial measures that have not been calculated in accordance with accounting principles generally accepted in the U.S., or GAAP, and are therefore referred to as non-GAAP financial measures. These measures include adjusted operating profit, adjusted net income, adjusted earnings per share, adjusted other (income) and expense, net, and adjusted effective tax rate. We believe these measures provide our investors with additional information about our underlying results and trends, as well as insight to some of the financial measures used to evaluate management.

Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for the comparable GAAP measures, and they should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. There are limitations to these non-GAAP financial measures because they are not prepared in accordance with GAAP and may not be comparable to similarly titled measures of other companies due to potential differences in methods of calculation and items being excluded. We compensate for these limitations by using these non-GAAP financial measures as a supplement to the GAAP measures and by providing reconciliations of the non-GAAP and comparable GAAP financial measures.

The non-GAAP financial measures exclude the following items for the relevant time periods as indicated in the reconciliations included later in this MD&A:

Pension settlement charges - In 2015, we recorded settlement-related charges from certain actions taken for our U.S. pension plan.

2014 Organization Restructuring - In 2014, we initiated a restructuring plan in order to improve organization efficiency and offset the impact of stranded overhead costs resulting from the spin-off of our health care business. Results in both 2016 and 2015 include charges related to this initiative.

Charge related to Venezuelan Operations - Results in 2015 include a charge for remeasuring the local currency balance sheet in Venezuela.

In addition, we provide commentary regarding organic net sales, which exclude the impact of changes in foreign currency rates.

Overview of ~~Third~~First Quarter ~~2015~~2016 Results

Net sales of ~~$4.7~~$4.5 billion decreased 75 percent compared to ~~the year-ago period,~~prior year, as changes in foreign currency exchange rates reduced net sales 127 percent. ~~Sales volumes increased approximately~~Organic net sales rose 2 percent, including a 5 percent increase in developing and ~~product mix/other was slightly favorable.~~emerging markets.

Operating profit of ~~$779~~$804 and net income attributable to Kimberly-Clark Corporation of ~~$517 decreased $98~~$545 increased 7 percent and ~~$45,~~16 percent, respectively, compared to the prior year. The ~~decreases~~increases were driven by ~~negative effects of changes~~lower expense in ~~foreign currency exchange rates, partially offset by cost savings~~other (income) and ~~the impact of increased sales volumes.~~expense, net and a lower effective tax rate.

Diluted earnings per share of ~~$1.41~~$1.50 in ~~2015 declined~~2016 increased versus the prior year of $1.27 due to ~~lower~~the higher earnings ~~as noted above, partially offset by~~and a lower share count.

Results of Operations and Related Information

This section presents a discussion and analysis of our ~~third~~first quarter ~~2015~~2016 net sales, operating profit and other information relevant to an understanding of the results of operations.

We completed the spin-off of our health care business (Halyard Health, Inc.) on October 31, 2014. As a result, the health care business is presented as discontinued operations on the Consolidated Income Statement for all periods presented, and prior period Consolidated Income Statements and related disclosures have been recast accordingly. Segment results present net sales and operating profit by segment on a continuing operations basis.

~~Results By Business Segment~~Consolidated

Three Months Ended September 30 Nine Months Ended September 30
2015 2014 Change 2015 2014 Change
NET SALES
Personal Care $ 2,357
$ 2,475
-4.8 % $ 6,971
$ 7,299
-4.5 %
Consumer Tissue 1,528
1,697
-10.0 % 4,601
5,024
-8.4 %
K-C Professional 826
873
-5.4 % 2,443
2,531
-3.5 %
Corporate & Other 7
11
N.M.
37
42
N.M.
TOTAL NET SALES $ 4,718
$ 5,056
-6.7 % $ 14,052
$ 14,896
-5.7 %

OPERATING PROFIT
Personal Care $ 484
$ 483
+0.2 % $ 1,412
$ 1,393
+1.4 %
Consumer Tissue 260
285
-8.8 % 811
782
+3.7 %
K-C Professional 154
165
-6.7 % 433
453
-4.4 %
Corporate & Other^(a)
(84 ) (72 ) N.M.
(244 ) (236 ) N.M.
Other (income) and expense, net^(b)
35
(16 ) N.M.
1,429
29
N.M.
TOTAL OPERATING PROFIT $ 779
$ 877
-11.2 % $ 983
$ 2,363
-58.4 %



Selected Financial Results	Three Months Ended March 31
	2016		2015		Change 2016 vs. 2015
Net Sales	$	4,476	$	4,691	-4.6	%
Other (income) and expense, net	10		62		-83.9	%
Operating Profit	804		748		+7.5	%
Provision for income taxes	207		230		-10.0	%
Share of net income from equity companies	35		36		-2.8	%
Net Income	560		486		+15.2	%
Net Income Attributable to Kimberly-Clark Corporation	545		468		+16.5	%
Diluted Earnings per Share	1.50		1.27		+18.1	%

Operating Profit Reconciliation of GAAP to Non-GAAP

~~Results By Geography~~Operating profit includes the following adjusting items:

Three Months Ended September 30 Nine Months Ended September 30
2015 2014 Change 2015 2014 Change
NET SALES
North America $ 2,462
$ 2,383
+3.3 % $ 7,181
$ 7,092
+1.3 %
Outside North America 2,344
2,762
-15.1 % 7,132
8,068
-11.6 %
Intergeographic sales (88 ) (89 ) N.M.
(261 ) (264 ) N.M.
TOTAL NET SALES $ 4,718
$ 5,056
-6.7 % $ 14,052
$ 14,896
-5.7 %

OPERATING PROFIT
North America $ 555
$ 544
+2.0 % $ 1,615
$ 1,504
+7.4 %
Outside North America 343
389
-11.8 % 1,041
1,124
-7.4 %
Corporate & Other^(a)
(84 ) (72 ) N.M.
(244 ) (236 ) N.M.
Other (income) and expense, net^(b)
35
(16 ) N.M.
1,429
29
N.M.
TOTAL OPERATING PROFIT $ 779
$ 877
-11.2 % $ 983
$ 2,363
-58.4 %



	Three Months Ended March 31
	2016		2015
Operating Profit, GAAP	$	804	$	748
Plus adjustments for:
2014 Organization Restructuring	14		13
Pension Settlements	—		9
Charge Related to Venezuelan Operations	—		45
Adjusted Operating Profit	$	818	$	815

~~N.M. - Not Meaningful~~

~~(a)~~

Corporate & Other includes charges related to the 2014 Organization Restructuring of $11 and $36 for the three and nine months ended September 30, 2015, respectively, and a charge related to the remeasurement of the Venezuelan balance sheet of $5 for the nine months ended September 30, 2015. Corporate & Other also includes charges of $17 for restructuring in Turkey for the three and nine months ended September 30, 2015. In addition, Corporate & Other includes charges related to the European strategic changes of $1 and $13 for the three and nine months ended September 30, 2014, respectively.

~~(b)~~

~~Percentage Change~~ ~~2015~~ ~~Versus~~ ~~2014~~

Consolidated Net Sales and Adjusted Operating Profit

NET SALES Changes Due To
Three Months Ended September 30 Total Volume Net Price
Mix/Other^(a)
Currency
Personal Care (4.8) 7 — 1 (13)
Consumer Tissue (10.0) 2 (1) — (11)
K-C Professional (5.4) 2 — 3 (10)
TOTAL CONSOLIDATED (6.7) 5 — — (12)

Nine Months Ended September 30
Personal Care (4.5) 5 1 1 (11)
Consumer Tissue (8.4) 2 (1) — (9)
K-C Professional (3.5) 3 — 3 (9)
TOTAL CONSOLIDATED (5.7) 4 — — (10)


~~(a)~~	~~Mix/Other includes rounding.~~

OPERATING PROFIT Changes Due To
Three Months Ended September 30

Total
Volume Net Price
Input Costs^(a)
Cost Savings Currency Translation
Other^(b)
Personal Care 0.2 14 2 9 12 (13) (24)
Consumer Tissue (8.8) 5 (3) (2) 7 (9) (7)
K-C Professional (6.7) 7 — 3 5 (15) (7)
TOTAL CONSOLIDATED (11.2) 11 — 5 10 (13) (24)

Nine Months Ended September 30
Personal Care 1.4 9 5 5 12 (11) (19)
Consumer Tissue 3.7 6 (6) 1 12 (8) (1)
K-C Professional (4.4) 6 (2) 4 4 (13) (3)
TOTAL CONSOLIDATED (58.4) 8 1 4 12 (12) (71)


~~(a)~~	~~Includes inflation/deflation in raw materials, energy and distribution costs.~~


~~(b)~~	Other includes the impact of changes in marketing, research and general expenses and manufacturing costs not separately listed in the table. In addition, Other includes the impact of charges recorded in Corporate & Other and other (income) and expense, net, including charges related to pension settlements in 2015, as described above.

~~Commentary - Third Quarter of 2015 Compared to Third Quarter of 2014~~

~~Consolidated~~



Net Sales	Percent Change		Adjusted Operating Profit	Percent Change
Volume	2		Volume	5
Net Price	—		Net Price	1
Mix/Other^(a)	—		Input Costs	4
Currency	(7	)	Cost Savings	12
Total	(4.6	)	Currency Translation	(6	)
^(a)Mix/Other includes rounding			Other	(16	)
			Total	0.4

Net sales of ~~$4.7~~$4.5 billion in the ~~third~~first quarter of ~~2015 were down 7~~2016 decreased 5 percent compared to ~~the year-ago period.~~prior year. Changes in foreign currency exchange rates reduced net sales 127 percent as a result of the weakening of most currencies relative to the U.S. dollar. ~~Sales volumes increased approximately 5~~Organic net sales rose 2 percent ~~and product mix/other was slightly favorable.~~due to higher volumes.

~~Third quarter~~Adjusted operating profit was ~~$779~~$818 in ~~2015 and $877~~the first quarter of 2016 compared to $815 in ~~2014. Results in 2015 include $19 of charges related to pension settlements, $17 of charges for restructuring our business in Turkey and $11 of 2014 Organization Restructuring costs.~~

the prior year. The ~~year-over-year operating profit~~ comparison benefited from organic net sales ~~volume~~ growth, ~~improved product mix, $85~~$95 in cost savings from ~~our~~the company's FORCE (Focused Onon Reducing Costs Everywhere) program and ~~$20~~$15 of savings from the 2014 Organization Restructuring. Input costs decreased ~~$45 overall due to~~$30 including $25 of lower costs for raw materials other than ~~fiber.~~fiber and $5 of lower fiber costs. Translation effects due to changes in foreign currency exchange rates lowered operating profit by ~~$115~~$50 and transaction effects also negatively impacted the comparison. Total marketing, research and general expenses increased on a local currency basis, ~~mostly due~~driven by higher selling, administrative and research costs.

Other (Income) & Expense, Net Reconciliation of GAAP to ~~higher administrative costs.~~Non-GAAP

Other (income) & expense, net includes the following adjusting items:



	Three Months Ended March 31
	2016		2015
Other (income) and expense, net, GAAP	$	10	$	62
Less adjustments for:
Pension Settlements	—		9
Charge Related to Venezuelan Operations	—		40
Adjusted other (income) and expense, net	$	10	$	13

Adjusted other (income) and expense, net was an expense of ~~$35~~$10 in ~~2015~~2016 and ~~income~~an expense of ~~$16~~$13 in ~~2014.~~2015. Results in ~~2015~~both quarters were ~~driven~~impacted by ~~charges related to pension settlements and~~ foreign currency transaction ~~losses, while prior-period results benefited from a gain on~~losses.

Provision for Income Taxes Reconciliation of GAAP to Non-GAAP

Provision for income taxes includes the ~~sale of certain non-core assets.~~following adjusting items:



	Three Months Ended March 31
	2016			2015
Effective Tax Rate, GAAP	28.3		%	33.8		%
Provision for income taxes, GAAP	$	207		$	230
Plus adjustments for:
2014 Organization Restructuring	4			8
Pension Settlements	—			3
Adjusted Provision for income taxes	$	211		$	241
Adjusted Effective Tax Rate	28.3		%	32.3		%

The ~~third quarter~~decrease in the adjusted effective tax rate ~~was 30.6 percent~~ in ~~2015 and 32.1 percent in 2014. The decrease was primarily due to the effect~~2016 is a result of ~~changes in foreign currency exchange rates on repatriation activities.~~benefits from certain tax planning initiatives.

~~Kimberly-Clark's~~Share of Net Income from Equity Companies

Our share of net income of equity companies inwas $35

and $36 for the ~~third quarter was $37 in~~three months ended March 31, 2016 and 2015, ~~and $31 in 2014. At~~respectively. Kimberly-Clark de Mexico, S.A.B. de C.V., ("KCM") results in 2016 compared to 2015 benefited from organic net sales ~~volume~~ growth, ~~higher net selling prices,~~ lower input costs and cost savings, ~~but were negatively impacted~~offset by a weaker Mexican peso. ~~Third quarter net income attributable~~

Net Income Attributable to ~~noncontrolling interests was $12~~Kimberly-Clark and Diluted Earnings Per Share

Reconciliations of GAAP to Non-GAAP

Net Income Attributable to Kimberly-Clark and Diluted Earnings Per Shareinclude the following adjusting items:



	Three Months Ended March 31
	2016		2015
Net Income Attributable to Kimberly-Clark, GAAP	$	545	$	468
Plus adjustments (net of tax) for:
2014 Organization Restructuring	10		5
Pension Settlements	—		6
Charge Related to Venezuelan Operations	—		45
Adjusted Net Income Attributable to Kimberly-Clark	$	555	$	524



	Three Months Ended March 31
	2016		2015
Diluted Earnings Per Share, GAAP	$	1.50	$	1.27
Plus adjustments for:
2014 Organization Restructuring	0.03		0.01
Pension Settlements	—		0.02
Charge Related to Venezuelan Operations	—		0.12
Adjusted Earnings Per Share	$	1.53	$	1.42

The increase in ~~2015~~adjusted earnings per share in 2016 is primarily due to higher earnings and ~~$20 in 2014. The change was driven~~a lower share count.

Results By Geography



	Three Months Ended March 31
	2016			2015
NET SALES
North America	$	2,373		$	2,360
Outside North America	2,175			2,418
Intergeographic sales	(72		)	(87		)
TOTAL NET SALES	$	4,476		$	4,691

OPERATING PROFIT
North America	$	570		$	528
Outside North America	309			352
Corporate & Other^(a)	(65		)	(70		)
Other (income) and expense, net^(a)	10			62
TOTAL OPERATING PROFIT	$	804		$	748


^(a)	Corporate & Other and other (income) and expense, net include expenses not associated with the business segments, including charges as indicated in the Non-GAAP Reconciliations.

Results by ~~the redemption of $0.5 billion of preferred securities in December 2014.~~Business Segments

Personal Care ~~Segment~~

~~Third~~



	Three Months Ended March 31						Three Months Ended March 31
	2016		2015				2016		2015
Net Sales	$	2,207	$	2,308		Operating Profit	$	449	$	455

Net Sales			Percent Change			Adjusted Operating Profit			Percent Change
Volume			3			Volume			8
Net Price			—			Net Price			(1		)
Mix/Other^(a)			2			Input Costs			6
Currency			(9		)	Cost Savings			14
Total			(4.4		)	Currency Translation			(8		)
^(a)Mix/Other includes rounding						Other			(20		)
						Total			(1.3		)

First quarter net sales of ~~$2.4~~$2.2 billion decreased ~~5 percent. Currency~~4 percent compared to prior year. Unfavorable currency rates ~~were unfavorable~~reduced net sales by 139 percent. Sales volumes increased ~~more than 7~~3 percent and changes in product mix ~~was favorable~~improved net sales by 1 percent. ~~Third~~First quarter operating profit of ~~$484 was essentially even with the year-ago period.~~$449 decreased 1 percent compared to prior year. The comparison ~~benefited from sales volume growth, improved product mix, cost savings and lower input costs, offset~~was impacted by unfavorable currency effects and increased marketing, research and general spending on a local currency basis. This was mostly offset by organic net sales growth, cost savings and lower input costs.

Net sales in North America increased 3 percent compared to prior year. Sales volumes improved 5 percent, while the combined impact of changes in net selling price and product mix reduced net sales by 1 percent. Currency was unfavorable 21 percent. Sales volumes rose 10 percent, while net selling prices fell 3 percent, driven by increased promotion activity. Huggies diaper volumes rose low double-digits compared to a low double-digit decline last year and included benefits from innovation and increased promotion support. Adult care volumes

~~were up~~ increased double-digits, ~~including strong growth on Poise and Depend absorbent products and introductory shipments of new Poise Impressa bladder supports. Huggies baby wipes volumes rose high-single digits,~~ with benefits from ~~innovation,~~category growth, innovations and market share gains. Baby wipes and child care volumes each rose mid-single digits, including benefits from innovation. Feminine care volumes advanced low-single digits and diaper volumes were ~~up mid-single digits.~~even with year-ago levels.

Net sales in developing and emerging markets decreased 11 percent, including ~~a 25~~an approximate18 percent ~~negative~~ impact from ~~changes in~~unfavorable currency rates. ~~Sales~~Changes in sales volumes, ~~increased 8 percent,~~ net selling prices ~~improved 4 percent~~ and product mix ~~advanced 1~~each improved net sales by 2 percent. The volume growth included gains in China ~~Eastern Europe~~ and ~~most~~portions of Latin ~~America, led~~America. Sales volumes were down in Brazil, as comparisons were impacted by ~~Argentina, Brazil~~difficult economic conditions and ~~Colombia.~~strong growth in the base period. The higher net selling prices were driven by ~~increases in~~Latin America and Eastern Europe ~~and Latin America~~ in response to weaker currency ~~rates.~~rates and local cost inflation. Net selling prices declined in China due to increased promotion activity.

Net sales in developed markets outside North America ~~(Australia, South Korea and Western/Central Europe)~~ decreased 157 percent, including a 9 percent impact from unfavorable changes in currency rates. Sales volumes rose 2 percent, driven by ~~unfavorable currency rates.~~Australia. Changes in product mix improved net sales by 2 percent, while lower net selling prices reduced net sales by 2 percent.

Consumer Tissue ~~Segment~~

~~Third~~



	Three Months Ended March 31						Three Months Ended March 31
	2016		2015				2016		2015
Net Sales	$	1,496	$	1,574		Operating Profit	$	280	$	291

Net Sales			Percent Change			Adjusted Operating Profit			Percent Change
Volume			—			Volume			—
Net Price			1			Net Price			4
Mix/Other ^(a)			(1		)	Input Costs			1
Currency			(5		)	Cost Savings			5
Total			(5.0		)	Currency Translation			(2		)
^(a)Mix/Other includes rounding						Other			(12		)
						Total			(3.8		)

First quarter net sales of $1.5 billion decreased ~~10 percent.~~by 5 percent compared to prior year. Currency rates were unfavorable by 115 percent. ~~Sales volumes increased 2 percent, while~~Higher net selling prices ~~were down~~increased net sales by 1 percent, while changes in product mix reduced net sales by 1 percent. ~~Third~~First quarter operating profit of ~~$260~~$280 decreased ~~9 percent.~~by 4 percent compared to prior year. The comparison was impacted by unfavorable currencies, partially offset by cost savings.

Net sales in North America increased 1 percent compared to prior year. Sales volumes increased by 3 percent, while changes in product mix decreased net sales by 2 percent. Sales volumes ~~increased 6 percent, while net selling prices were off 2 percent and~~improved in all product mix was unfavorable 1 percent. Paper towel volumes rose double-digits, including benefits from increased promotion shipments on Viva. Kleenex facial tissue volumes increased high-single digits behind Back to School marketing and promotion support. Bathroom tissue volumes were up mid-single digits.categories, led by paper towels.

Net sales in developing and emerging markets decreased 2614 percent including a ~~29 point~~14 percent negative impact from currency rates. ~~Net~~Changes in net selling prices increased net sales by about 5 percent, while sales volumes decreased 4 percent. The changes in net selling prices and volumes ~~each rose 1 percent.~~mostly occurred in Latin America.

Net sales in developed markets outside North America decreased ~~17 percent, including a 13 point decrease from currency rates.~~9 percent. Currency rates were unfavorable by 7 percent. Sales volumes ~~were down 5~~decreased 2 percent, ~~mostly~~primarily in ~~Australia and~~ Western/Central ~~Europe, while the combined impact of changes~~Europe. Changes in net selling prices ~~and~~reduced net sales by 1 percent, while product mix ~~benefited~~improved net sales by 1 percent.

K-C Professional ~~("KCP") Segment~~

~~Third~~



	Three Months Ended March 31						Three Months Ended March 31
	2016		2015				2016		2015
Net Sales	$	763	$	795		Operating Profit	$	150	$	134

Net Sales			Percent Change			Adjusted Operating Profit			Percent Change
Volume			1			Volume			7
Net Price			1			Net Price			4
Mix/Other^(a)			(1		)	Input Costs			1
Currency			(5		)	Cost Savings			9
Total			(4.0		)	Currency Translation			(5		)
^(a)Mix/Other includes rounding						Other			(4		)
						Total			11.9

First quarter net sales of ~~$0.8 billion~~$763 decreased ~~5 percent.~~by 4 percent compared to prior year. Changes in currency rates reduced net sales 10by 5 percent. ~~Product~~Sales volumes and net selling prices each increased net sales by 1 percent while changes in product mix/other ~~was favorable~~decreased net sales by 31 percent. The decline in product mix/other included an approximate 2 percent ~~including~~impact from lower net sales of nonwovens to Halyard Health, Inc. ~~in conjunction with a near-term supply agreement, and volumes rose 2 percent. Third~~First quarter operating profit of ~~$154 decreased 7 percent.~~$150 increased by 12 percent compared to prior year. The comparison ~~was impacted~~benefited from organic net sales growth and cost savings, partially offset by unfavorable currency ~~effects, partially offset by benefits from sales volume growth and cost savings.~~effects.

Net sales in North America ~~were even with the~~increased by 3 percent compared to prior year. ~~Currency was unfavorable 1 percent.~~ Sales volumes ~~rose 1~~improved 3 percent, ~~primarily due to~~driven by growth in ~~wipers.~~

~~Net sales in developing~~washroom products and ~~emerging markets decreased 19 percent, including a 25 point decrease from currency rates.~~wipers. The combined impact of changes in net selling prices and product mix increased net sales 4by 1 percent, while currency was unfavorable 1 percent.

Net sales in developing and emerging markets decreased by 11 percent including an unfavorable impact from currency rates changes of 15 percent. Changes in net selling prices and product mix increased net sales by 5 and 3 percent, respectively. Sales volumes ~~improved 2~~decreased by 4 percent.

Net sales in developed markets outside North America ~~were down 12~~decreased 8 percent. Changes in currency rates reduced net sales 16by 6 percent. ~~Sales volumes increased 5 percent, mostly in South Korea and Western/Central Europe. The combined impact of changes in overall~~Lower net selling prices ~~and product mix reduced~~decreased net sales by 3 percent, while volumes increased 1 percent.

~~First Nine Months of 2015 Compared to First Nine Months of 2014~~

For the first nine months of 2015, net sales of $14.1 billion decreased 6 percent compared to the year-ago period, as changes in foreign currency exchange rates reduced net sales 10 percent. Sales volumes increased 4 percent and product mix/other was slightly favorable.

Year-to-date operating profit was $983 in 2015 versus $2,363 in 2014. Results in 2015 include $1,350 of charges related to pension settlements, $36 of 2014 Organization Restructuring costs, $17 of charges for restructuring our business in Turkey and a charge of $45 related to the remeasurement of the Venezuelan balance sheet. Results in 2014 include $13 of restructuring costs for European strategic changes and a charge of $39 related to a regulatory dispute in the Middle East. Operating profit comparisons benefited from sales volume growth, improved product mix, FORCE cost savings of $280, input cost deflation of $100 and $50 of savings from the 2014 Organization Restructuring. Translation effects due to changes in foreign currency exchange rates lowered operating profit by $275 and transaction effects also negatively impacted the operating profit comparisons.

Other (income) and expense, net was expense of $1,429 compared to $29 in 2014. Results in 2015 were driven by charges related to pension settlements and foreign currency transaction losses, while prior-period results included foreign currency transaction losses and a charge related to a regulatory dispute in the Middle East, partially offset by gains on asset sales.

Year-to-date income before income taxes and equity interests of $776 and the provision for income taxes of $166 include charges related to pension settlements of $1,350 and a corresponding tax benefit of $520. Excluding the impact of the charges related to pension settlements, pre-tax earnings and the provision for income taxes were $2,126 and $686, respectively, resulting in an effective tax rate of 32.3 percent. The year-to-date 2014 effective tax rate was 31.5 percent.

Through nine months, diluted earnings per share were $1.85 in 2015 compared to diluted earnings per share from continuing operations of $4.08 in 2014. Charges related to pension settlements reduced earnings per share in 2015 by $2.26.

2014 Organization Restructuring

The restructuring is expected to be completed by the end of 2016, with total costs, primarily severance, anticipated to be toward the high end of the range of $130 to $160 after tax ($190 to $230 ~~pre-tax)~~pretax). Cash costs are projected to be approximately 80 percent of the total charges. Cumulative ~~pre-tax~~pretax savings from the restructuring are expected to be toward the high end of the range of $120 to $140 by the end of 2017, and were ~~$55~~$85 through ~~September 30, 2015.~~March 31, 2016. The restructuring is expected to impact all of our business segments and our organizations in all major geographies.

Charges of $7$10 and $5 after tax ($~~11 pre-tax)~~14 and ~~$20 after tax ($36 pre-tax)~~$13 pretax), were recognized during the three ~~and nine~~ months ended ~~September 30,~~March 31, 2016 and 2015, respectively, for the restructuring. ~~Through September 30, 2015, cumulative pre-tax charges for the restructuring were $169 ($115 after tax), including cumulative pre-tax cash charges of $135.~~

Defined Benefit Pension Plan Changes

Effective January 2015, the U.S. pension plan was amended to include a lump-sum pension benefit payout option for certain plan participants. In addition, in April 2015, the U.S. pension plan completed the purchase of group annuity contracts that transferred to two insurance companies the pension benefit obligations totaling $2.5 billion for approximately 21,000 Kimberly-Clark retirees in the United States. In connection with these transactions, during the first quarter of 2015 we made a $410 contribution to our U.S. pension plan in order to maintain the plan’s funded status. As a result of these changes, we recognized ~~charges related to~~ pension ~~settlements~~settlement-related charges of $0.8 billion after tax ($1.4 billion ~~pre-tax~~pretax in other (income) and expense, net) during ~~the nine months ended September 30,~~ 2015, mostly in the second quarter.

~~For~~Accounting for Venezuelan Operations

Effective December 31, 2015, we deconsolidated the ~~nine~~assets and liabilities of our business in Venezuela from our consolidated balance sheet and moved to the cost method of accounting for our operations in that country. The change resulted in the recognition of an after tax charge of $102 in the fourth quarter of 2015. As of the first quarter of 2016, we no longer include the results of our Venezuelan business in our consolidated financial statements. Prior to deconsolidation, in February 2015 we remeasured our local currency-denominated balance sheet at the applicable floating SIMADI exchange rate (193 bolivars per U.S. dollar at March 31, 2015) as we believed this was the most accessible rate available to us in the absence of exchange at 6.3 bolivars per U.S. dollar. This remeasurement resulted in a non-deductible charge of $45 in the Consolidated Income Statement for the three months ended ~~September 30,~~March 31, 2015, ~~we made cash contributions~~with $5 recorded in cost of ~~$437 to our pension trusts,~~products sold and $40 recorded in other (income) and expense, net. Net sales of ~~which $410 relates to the changes above. In total we expect to contribute $440 to $500 to our defined benefit pension plans for the full year~~K-C Venezuela were insignificant in 2015. ~~For the nine months ended September 30, 2014, we made cash contributions of $180 to our pension trusts.~~

Liquidity and Capital Resources

Cash Provided by Operations

Cash provided by operations was ~~$1.6 billion~~$553 for the first ~~nine~~three months of ~~2015,~~2016, compared to ~~$2.3 billion~~$20 in the prior year. The ~~comparison~~increase was ~~affected~~driven by ~~the higher~~lower pension contributions ~~increased operating working capital~~ and tax payments. First quarter defined benefit pension plan contributions were $30 in 2016 and $435 in 2015. We expect to contribute up to $100 to our defined benefit pension plans for the ~~spin-off of the health care business in the fourth quarter of 2014.~~full year 2016.

Investing

During the first ~~nine~~three months of ~~2015,~~2016, our capital spending was ~~$798~~$220 compared to ~~$730~~$284 in the prior year. We anticipate that full-year ~~2015~~2016 capital spending will be ~~toward the high end of our target range of~~between $950 toand $1,050.

Financing

On ~~August 3, 2015,~~February 22, 2016, we issued ~~$250~~$400 aggregate principal amount of ~~2.15%~~1.40% notes due ~~August~~February 15, ~~2020~~2019 and ~~$300~~$400 aggregate principal amount of ~~3.05%~~2.75% notes due ~~August~~February 15, ~~2025. Proceeds from the offering were used to repay $300 of notes due in August 2015 and to pay down a portion of our outstanding commercial paper balance.~~

~~On February 27, 2015, we issued $250 aggregate principal amount of 1.85% notes due March 1, 2020 and $250 aggregate principal amount of 2.65% notes due March 1, 2025.~~2026. Proceeds from the offering were used for general corporate purposes, including ~~pension contribution payments.~~repayment of a portion of our outstanding commercial paper indebtedness.

Our short-term debt, which consists of U.S. commercial paper with original maturities up to 90 days and/or other similar short-term debt issued by non-U.S. subsidiaries, was ~~$659~~$400 as of ~~September 30, 2015~~March 31, 2016 (included in debt payable within one year on the Consolidated Balance Sheet). The average month-end balance of short-term debt for the ~~third~~first quarter of ~~2015~~2016 was ~~$848.~~$805. These short-term borrowings provide supplemental funding for supporting our operations. The level of short-term debt generally fluctuates depending upon the amount of operating cash flows and the timing of customer receipts and payments for items such as pension contributions, dividends and income taxes.

At ~~September 30, 2015,~~March 31, 2016, total debt was ~~$7.6~~$7.9 billion compared to ~~$7.0~~$7.8 billion at December 31, ~~2014.~~2015.

We maintain a $2.0 billion revolving credit facility which expires in 2019. This facility, currently unused, supports our commercial paper program, and would provide liquidity in the event our access to the commercial paper markets is unavailable for any reason.

We repurchase shares of Kimberly-Clark common stock from time to time pursuant to publicly announced share repurchase programs. During the first ~~nine~~three months of ~~2015,~~2016, we repurchased ~~4.1~~1.1 million shares of our common stock at a cost of ~~$450~~$150 through a broker in the open market. ~~In addition, we acquired the remaining interest in our subsidiary in Israel for $151.~~ We are targeting full-year ~~2015~~2016 share repurchases of ~~$800,~~$600 to $900, subject to market conditions.

We account for our operations in Venezuela using highly inflationary accounting. We have historically measured results in Venezuela at the rate in which we transact our business, which was 6.3 bolivars per U.S. dollar until December 31, 2014. Given the level of uncertainty and lack of liquidity in Venezuela, we remeasured our local currency-denominated balance sheet as of December 31, 2014 at the year-end floating SICAD II exchange rate of 50 bolivars per U.S. dollar, as we believed this was the most accessible rate available in the absence of exchange at 6.3 bolivars per U.S. dollar. This remeasurement resulted in a non-deductible charge of $462 in the Consolidated Income Statement for the year ended December 31, 2014.

On February 10, 2015, the Venezuelan government announced the addition of a new foreign currency exchange system referred to as the Marginal Currency System, or SIMADI, along with the elimination of the SICAD II system. With the elimination of SICAD II in February 2015, we remeasured our local currency-denominated balance sheet during the first quarter of 2015 at the applicable floating SIMADI exchange rate as we believe this is the most accessible rate available to us in the absence of exchange at 6.3 bolivars per U.S. dollar. This remeasurement resulted in a non-deductible charge of $45 in the Consolidated Income Statement in the first quarter of 2015. Remeasurement charges since March 31, 2015 have not been significant. The SIMADI exchange rate at September 30, 2015 was 199 bolivars per U.S. dollar. At September 30, 2015, our net investment in K-C Venezuela was approximately $100, and the bolivar-denominated net monetary asset position was not significant. Net sales of K-C Venezuela represented less than 1 percent and 3 percent of consolidated net sales for the nine months ended September 30, 2015 and 2014, respectively.

Legal Matters

We believe that the ultimate disposition of litigation or compliance obligations with environmental protections laws and regulations, individually or in the aggregate, will not have a material adverse effect on our business, financial condition, results of operations or liquidity.

Business Outlook

In ~~2015,~~2016, we plan to continue to execute our Global Business Plan strategies, which include a focus on targeted growth initiatives, innovation and brand building, cost savings programs and shareholder-friendly capital allocation. In 2016, we expect adjusted earnings per share in a range of $5.95 to $6.15. This excludes expected 2014 Organization Restructuring charges equivalent to $0.03 to $0.06. Our adjusted earnings per share guidance is based on the assumptions described below:

Growth in ~~volume,~~organic net ~~selling prices and product mix~~sales is expected to be in the combined 43 to 5 percent ~~target range (prior assumption of 3 to 5 percent).~~range.

We expect net sales to be negatively impacted by unfavorable foreign currency exchange rates of 10 to 11 percent (prior assumption of 10 percent), including an approximate 3 percent impact from exchange rate changes in Venezuela. We also expect unfavorablenegative foreign currency translation effects ~~to negatively impact~~on net sales and operating profit ~~growth by 11~~ to ~~12 percent (prior expectation~~be toward the low end of ~~11 percent), including an approximate 4 percent decrease from exchange rate changes in Venezuela.~~the previously assumed range of 5 to 6 percent. Currency transaction effects are also anticipated to negatively impact operating profit.

Benefits from higher net selling prices are expected to be somewhat lower than prior assumptions as a result of the updated estimates for changes in foreign currency exchange rates and cost inputs.

We anticipate the net impact of changes in commodity ~~cost~~costs to be between $0 and $150 of deflation year-on-year compared to the prior range of $50 inflation to $100 ~~to $200.~~of deflation.

We plan to achieve cost savings of at least $350 from our FORCE program, and ~~$60 to $80~~at least $50 from the 2014 Organization Restructuring.

We anticipate that advertising spending will ~~increase somewhat~~be similar to, or up slightly, as a percentage of net sales to support targeted growth initiatives, brand building and innovation activities.

We expect the adjusted effective tax rate to be between 30.5 and 32.5 percent.

Our share of net income from equity companies is expected to be similar to, or down somewhat, compared to 2015. The prior assumption was for net income to be similar to, or up somewhat, compared to 2015. The update assumes more negative currency effects at K-C de Mexico.

We anticipate capital spending will be ~~toward the high end of our target range of~~between $950 toand $1,050 and share repurchases of $600 to ~~total $800,~~$900, subject to market conditions.

~~We expect to contribute $440 to $500 to our defined benefit pension plans for the full year 2015.~~

Information Concerning Forward-Looking Statements

Certain matters contained in this report concerning the business outlook, including the anticipated costs, scope, timing and financial and other effects of the 2014 Organization Restructuring, the anticipated cost savings from the company’s FORCE program, cash flow and uses of cash, growth initiatives, innovations, marketing and other spending, cost savings and reductions, net sales, anticipated currency rates and exchange risks, raw material, energy and other input costs, contingencies and anticipated transactions of Kimberly-Clark, including dividends, share repurchases and pension contributions, constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and are based upon management's expectations and beliefs concerning future events impacting Kimberly-Clark. There can be no assurance that these future events will occur as

anticipated or that our results will be as estimated. Forward-looking statements speak only as of the date they were made, and we undertake no obligation to publicly update them.

The assumptions used as a basis for the forward-looking statements include many estimates that, among other things, depend on the achievement of future cost savings and projected volume increases. In addition, many factors outside our control, including fluctuations in foreign currency exchange rates, the prices and availability of our raw materials, potential competitive pressures on selling prices for our products, energy costs and retail trade customer actions, as well as general economic and political conditions globally and in the markets in which we do business, could affect the realization of these estimates.

For a description of certain factors that could cause our future results to differ from those expressed in these forward-looking statements, see Item 1A of our Annual Report on Form 10-K for the year ended December 31, ~~2014~~2015 entitled "Risk Factors." Other factors not presently known to us or that we presently consider immaterial could also affect our business operations and financial results.


Item 4.	Controls and Procedures

As of ~~September 30, 2015,~~March 31, 2016, an evaluation was performed under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on that evaluation, management, including the Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were effective as of ~~September 30, 2015.~~March 31, 2016. There were no changes in our internal control over financial reporting during the quarter covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

We repurchase shares of Kimberly-Clark common stock from time to time pursuant to publicly announced share repurchase programs. All our share repurchases during the ~~third~~first quarter of ~~2015~~2016 were made through a broker in the open market.

The following table contains information for shares repurchased during the ~~third~~first quarter of ~~2015.~~2016. None of the shares in this table were repurchased directly from any of our officers or directors.

Period (2015)
Total Number
of Shares
Purchased^(a)

Average
Price Paid
Per Share

Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
or Programs

Maximum Number
of Shares That May
Yet Be Purchased
Under the Plans or
Programs^(b)
July 1 to July 31 344,000 $111.47 49,775,811 40,224,189
August 1 to August 14 224,189 116.18 50,000,000 40,000,000
August 14 to August 31 271,811 110.24 271,811 39,728,189
September 1 to September 30 522,000 106.32 793,811 39,206,189
Total 1,362,000



Period (2016)	Total Number of Shares Purchased^(a)	Average Price Paid Per Share	Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares That May Yet Be Purchased Under the Plans or Programs
January 1 to January 31	103,000	$125.97	3,836,811	36,163,189
February 1 to February 29	503,000	129.78	4,339,811	35,660,189
March 1 to March 31	537,000	133.46	4,876,811	35,123,189
Total	1,143,000

(a)

Share repurchases were made pursuant to a share repurchase ~~programs~~program authorized by our Board of Directors on ~~January 21, 2011 (the "2011 Program") and~~ November 13, ~~2014 (the “2014 Program”), respectively. The 2011 Program allowed for the repurchase of 50 million shares in an amount not to exceed $5 billion, and the 2014 Program~~2014. This program allows for the repurchase of 40 million shares in an amount not to exceed $5 billion. Purchases from August 1 through August 14, 2015 of 224,189 shares exhausted the authority under the 2011 Program and, as a result, that program has expired. All remaining purchases in the third quarter of 2015 were made pursuant to the 2014 Program.


~~(b)~~	~~Includes shares available under both the 2011 Program (through August 14, 2015) and the 2014 Program.~~

Item 6. Exhibits


(a)	Exhibits

Exhibit No. (3)a. Amended and Restated Certificate of Incorporation, dated April 30, 2009, incorporated by reference to Exhibit No. (3)a of the Corporation's Current Report on Form 8-K dated May 1, 2009.

Exhibit No. (3)b. By-Laws, as amended ~~April 30, 2009,~~December 14, 2015, incorporated by reference to Exhibit No. (3)b of the Corporation's Current Report on Form 8-K dated ~~May 1, 2009.~~December 14, 2015.

Exhibit No. (4). Copies of instruments defining the rights of holders of long-term debt will be furnished to the Securities and Exchange Commission on request.

Exhibit No. (10)q. Form of Award Agreement under 2011 Equity Participation Plan for Performance Restricted Stock Units, filed herewith.

Exhibit No. (31)a. Certification of Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), filed herewith.

Exhibit No. (31)b. Certification of Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act, filed herewith.

Exhibit No. (32)a. Certification of Chief Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United States Code, furnished herewith.

Exhibit No. (32)b. Certification of Chief Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United States Code, furnished herewith.

Exhibit No. (101).INS XBRL Instance Document

Exhibit No. (101).SCH XBRL Taxonomy Extension Schema Document

Exhibit No. (101).CAL XBRL Taxonomy Extension Calculation Linkbase Document

Exhibit No. (101).DEF XBRL Taxonomy Extension Definition Linkbase Document

Exhibit No. (101).LAB XBRL Taxonomy Extension Label Linkbase Document

Exhibit No. (101).PRE XBRL Taxonomy Extension Presentation Linkbase Document

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.




KIMBERLY-CLARK CORPORATION
(Registrant)

By:		/s/ Maria Henry
		Maria Henry
		Senior Vice President and
		Chief Financial Officer
		(principal financial officer)

By:		/s/ Michael T. Azbell
		Michael T. Azbell
		Vice President and Controller
		(principal accounting officer)

~~October 21, 2015~~April 22, 2016

EXHIBIT INDEX




Exhibit No.		Description

(3)a.		Amended and Restated Certificate of Incorporation, dated April 30, 2009, incorporated by reference to Exhibit No. (3)a of the Corporation's Current Report on Form 8-K dated May 1, 2009.

(3)b.		By-Laws, as amended ~~April 30, 2009,~~December 14, 2015, incorporated by reference to Exhibit No. (3)b of the Corporation's Current Report on Form 8-K dated ~~May 1, 2009.~~December 14, 2015.

(4).		Copies of instruments defining the rights of holders of long-term debt will be furnished to the Securities and Exchange Commission on request.

(10)q.		Form of Award Agreement under 2011 Equity Participation Plan for Performance Restricted Stock Units, filed herewith.

(31)a.		Certification of Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), filed herewith.

(31)b.		Certification of Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act, filed herewith.

(32)a.		Certification of Chief Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United States Code, furnished herewith.

(32)b.		Certification of Chief Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United States Code, furnished herewith.

(101).INS		XBRL Instance Document

(101).SCH		XBRL Taxonomy Extension Schema Document

(101).CAL		XBRL Taxonomy Extension Calculation Linkbase Document

(101).DEF		XBRL Taxonomy Extension Definition Linkbase Document

(101).LAB		XBRL Taxonomy Extension Label Linkbase Document

(101).PRE		XBRL Taxonomy Extension Presentation Linkbase Document

2527



	Three Months Ended September 30, 2015			Nine Months Ended September 30, 2015
Cost of products sold	$	4		$	19
Marketing, research and general expenses	7			17
Provision for income taxes	(4		)	(16		)
Net charges	$	7		$	20



	Nine Months Ended September 30, 2015
Net Income attributable to Kimberly-Clark Corporation	$	680
Decrease in Kimberly-Clark Corporation's additional paid-in capital for acquisition	(94		)
Change from net income attributable to Kimberly-Clark Corporation and transfers to noncontrolling interest	$	586



NET SALES		Changes Due To
Three Months Ended September 30	Total	Volume	Net Price	Mix/Other^(a)	Currency
Personal Care	(4.8)	7	—	1	(13)
Consumer Tissue	(10.0)	2	(1)	—	(11)
K-C Professional	(5.4)	2	—	3	(10)
TOTAL CONSOLIDATED	(6.7)	5	—	—	(12)

Nine Months Ended September 30
Personal Care	(4.5)	5	1	1	(11)
Consumer Tissue	(8.4)	2	(1)	—	(9)
K-C Professional	(3.5)	3	—	3	(9)
TOTAL CONSOLIDATED	(5.7)	4	—	—	(10)



Period (2015)	Total Number of Shares Purchased^(a)	Average Price Paid Per Share	Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares That May Yet Be Purchased Under the Plans or Programs^(b)
July 1 to July 31	344,000	$111.47	49,775,811	40,224,189
August 1 to August 14	224,189	116.18	50,000,000	40,000,000
August 14 to August 31	271,811	110.24	271,811	39,728,189
September 1 to September 30	522,000	106.32	793,811	39,206,189
Total	1,362,000