Kimberly-Clark's Second Quarter 2003 Sales Rose 4 Percent to $3.5
Billion; Diluted Net Income Was 82 Cents Per Share
Company Outlines Strategic Plan and Long-Term Objectives
DALLAS, July 23, 2003--Kimberly-Clark Corporation (NYSE: KMB) today
reported that sales in the second quarter of 2003 were $3.5 billion, an
increase of 4 percent over the prior year. Diluted net income for the
second quarter was 82 cents per share in 2003, up from 81 cents per
share in 2002.
Compared with earnings before unusual items of 86 cents per share
in 2002, second quarter earnings per share declined about 5 percent.
Last year's unusual items are described in more detail below.
Sales growth in the second quarter of 2003 was driven primarily by
a 4 percent improvement in currency exchange rates. Sales volumes were
essentially flat, reflecting weaker-than-expected growth in a number of
key categories in North America, particularly diapers and consumer
tissue products. Net selling prices were approximately the same as last
year, as price increases in certain geographies were offset by
continued high levels of competitive promotional spending overall.
Compared with the prior year, second quarter results were also
impacted by higher pretax pension expense of about $35 million.
Thomas J. Falk, chairman and chief executive officer of
Kimberly-Clark, said, "While sales volumes in the second quarter
trailed our earlier expectations and the cost of energy and raw
materials moved higher, we more than made up for these factors with
progress on our priority to cut costs this year. Our businesses
delivered savings of nearly $50 million in the quarter, putting us well
on our way to achieving our annual target of $175 million to $200
million. I'm also encouraged by the improvement in market share trends
for our diapers
- more -
- 2 -
and training pants in North America and the rebound in operating profit
margin for our Business-to-Business segment in the second quarter.
"Meanwhile, continued strong cash flow enabled us to repurchase
another 2.2 million shares of our common stock during the quarter.
"Today, we are also introducing our new global business plan.
It's the result of a six-month internal evaluation of our long-term
corporate and financial objectives. The plan calls for significant
changes in the way we operate, in particular how we assess our
opportunities and how we allocate our capital. As you will see from
details provided later in this news release, the main focus of the plan
is to drive improved returns. With the plan, we have reset our target
for top-line growth to 3 to 5 percent annually which, combined with
margin improvement and share repurchases, should enable us to deliver
earnings per share growth in the mid to high single digits. It will
also result in solid cash flow growth, enabling us to increase our
annual dividend at a high single-digit to low double-digit rate over
the next five years.
"Importantly, I believe that our new plan lays out a strong,
credible and achievable roadmap for delivering value to our
shareholders."
Unusual items
There were no unusual items in the second quarter of 2003. In the
second quarter of 2002, the company recorded a pretax charge of about
$27 million, or 3 cents per share, for losses associated with tax
credits in Brazil. Last year's second quarter results also included
pretax charges of approximately $15 million, equivalent to 2 cents per
share, for business improvement programs primarily in Latin America and
Europe.
Kimberly-Clark management believes that, because of the nature
of the unusual items, investors' understanding of the company's
performance is enhanced by disclosing earnings per share before unusual
items as a reasonable basis for comparison of the company's ongoing
results of operations. The attached Earnings Summary schedule provides
a reconciliation of earnings per share before unusual items
- more -
- 3 -
to diluted net income per share determined in accordance with generally
accepted accounting principles.
Review of second quarter sales
The company's Consumer Tissue and Business-to-Business segments
posted higher sales, while Personal Care sales were even with last
year.
Sales of consumer tissue products were up approximately 6
percent, driven primarily by currency effects in Europe and Australia.
Overall sales volumes increased nearly 1 percent following strong
growth of 13 percent in the second quarter of 2002. Net selling prices
were about the same as last year, as response to competitive
promotional activity in North America and Europe negated list price
increases mainly in those geographies.
In North America, sales volumes of consumer tissue products rose
1 percent on top of last year's 12 percent gain. Volume growth
remained solid for Cottonelle and Scott bathroom tissue despite
below-trend consumer demand for the overall category. Net pricing was
off almost 1 percent due to increases in competitive promotion
spending.
In Europe, sales advanced 20 percent primarily as a result of
improvement in currency exchange rates for the euro and the British
pound. Sales volumes rose 3 percent and net selling prices rose more
than 1 percent. Meanwhile, consumer tissue sales were up more than 5
percent in Asia, as volume gains in Korea and currency benefits in
Australia were partially offset by continued weakness in Taiwan.
Personal Care sales were flat in the second quarter.
Currency-related gains of about 3 percent and slightly higher net
selling prices were offset by lower sales volumes of more than 3
percent. Sales volumes were affected by intense competition in the
diaper category in a number of key markets as well as a slowdown in
category growth in North America.
In North America, Personal Care sales volumes decreased
approximately 4 percent versus the second quarter of 2002 despite
record shipments of Pull-Ups training pants, GoodNites youth pants and
Huggies Little Swimmers swimpants. Although sales volumes of Huggies
diapers were lower than last year, the brand's market share improved
- more -
- 4 -
sequentially from the first quarter to the second quarter. Net selling
prices of personal care products in North America were similar to last
year.
Personal care sales in Europe increased more than 11 percent in
the quarter due primarily to favorable currency rates, partially
offset by lower sales volumes for the company's diaper products. In
Asia, personal care sales rose nearly 11 percent in the second quarter,
highlighted by strong double-digit growth in Australia from a
combination of currency benefits and higher sales volumes. Sales
volumes were higher for the majority of the company's operations in the
region. Finally, in Latin America, sales decreased 15 percent, as price
increases were not sufficient to offset widespread volume and currency
weakness throughout most of the region.
Sales of business-to-business products increased nearly 8 percent
in the quarter, boosted by volume growth of about 3 percent and
currency benefits of more than 4 percent. The company's global Health
Care business posted record quarterly sales. Its sales volumes rose 10
percent, with strong growth outside North America and substantially
higher sales of face masks and gloves. K-C Professional's sales volumes
increased approximately 4 percent in North America and nearly 10
percent in Asia, but were flat in Europe. Overall selling prices
declined 1 percent compared with the second quarter of last year.
Other second quarter operating results
Operating profit in the second quarter of 2003 was $606.9 million,
about 3 percent below the prior year. The company made further progress
in its efforts to reduce costs in 2003, as savings ramped up to nearly
$50 million in the quarter from more than $40 million in the first
quarter. The savings are net of higher resin costs. The cost
reductions, however, were more than offset by the increase in pension
expense of about $35 million and higher fiber and energy costs of
approximately $40 million.
Kimberly-Clark's share of net income of equity companies in the
second quarter increased to $30.3 million in 2003 from $21.5 million in
2002 primarily due to higher net income at Kimberly-Clark de Mexico,
S.A. de C.V. (KCM). Most of the increase was attributable to
- more -
- 5 -
lower currency transaction losses compared with last year. Before
currency effects, KCM's second quarter sales improved approximately 6
percent, nearly offsetting inflationary cost increases.
Cash provided by operations in the second quarter was $689 million
compared with an all-time record of $797 million in 2002 and $521
million in the first quarter of this year.
Year-to-date results
For the first six months of 2003, sales of $7.0 billion were up
3.9 percent from $6.7 billion in the prior year. Excluding currency
effects, sales were essentially flat. Operating profit declined 8
percent to $1,186.2 million in 2003 versus $1,289.2 million in 2002.
Diluted earnings per share for the first six months of 2003 were $1.60
versus $1.65 in 2002, a decline of 3 percent. Earnings before unusual
items of $1.62 per share in 2003 were about 6 percent lower than last
year's level of $1.73 per share.
At June 30, 2003, net debt and preferred securities totaled
$3.8 billion, compared with $3.9 billion at the end of 2002. For the
first six months of the year, the company repurchased 4.7 million
shares of its common stock at a cost of approximately $225 million.
The company recently announced plans to redeem $200 million of
7.875 percent debentures and $200 million of 7 percent debentures. The
redemptions will take place in the third quarter, enabling the company
to refinance these obligations at substantially lower interest rates.
Because of the nature of these transactions, the company will consider
the costs of calling the debentures totaling approximately $20 million
as unusual items in the third quarter.
Outlook
Commenting on the outlook, Mr. Falk said, "Clearly, the business
environment remains difficult. Despite soft category growth, intense
competition and higher raw material and energy costs, we still expect
earnings per share before unusual items in the third quarter of 2003
will slightly exceed the second quarter. As for the fourth quarter, we
expect further sequential improvement in earnings per share before
unusual items.
- more -
- 6 -
"For the year, we are still aiming for earnings before unusual
items of $3.36 per share. Without some improvement in the business
environment, however, it's possible that target could prove to be
optimistic. That said, we will do our utmost to increase sales volumes
and aggressively reduce costs over the balance of the year in order to
deliver on our commitments."
Global Business Plan
Addressing the company's new strategic plan, Mr. Falk said it
is designed to make Kimberly-Clark a stronger and more competitive
company that delivers more predictable results.
"Our Global Business Plan is based, in part, on continuing to do
what we do well - understanding and meeting consumer wants and needs,
striving to be the best possible partner with our customers, and
driving innovation," he said. "But the plan also calls for our
organization to be more disciplined, balancing the growth and
profitability of our operations to drive improved returns."
The most significant structural element of the plan is that the
company has put each of its businesses into one of three categories
based on an in-depth assessment of their market dynamics, the strength
of their brands and technologies and their profitability and returns.
The categories - grow, sustain and fix - will govern how the company
allocates capital.
o In the first category are brands and sectors that are
growing the fastest - products like household towels,
wipes, training pants, and light-end adult incontinence.
Today, they account for more than 15 percent of sales and
operating profit. They offer superior returns and the
company's revised strategic plan calls for accelerated
investments to fuel their growth.
o In the second category are such businesses as North
American infant care and facial tissue - generating solid,
healthy returns and enjoying strong market shares. These
businesses today represent nearly two-thirds of net sales
and about three-quarters of operating profit. Here, the
company will
- more -
- 7 -
concentrate its investments on product improvements to
sustain its strong positions in these markets. Planned
productivity improvements will also support volume growth
and improved margin goals.
o Examples of businesses in the third category are
businesses like North American K-C Professional Washroom
and European Personal Care. They have not been performing
to satisfaction, accounting for 20 percent of net sales,
but less than 10 percent of operating profit. They are not
currently generating the returns on capital the company
expects. The primary focus will be to fix these businesses
before investing any significant capital in new capacity.
Mr. Falk noted that the new plan is all about setting priorities
and making changes that will help Kimberly-Clark grow sales and
maximize profit from each aspect of its operation. It also is a
realistic assessment of what the company's portfolio can achieve.
Accordingly, the company's revised key long-term financial objectives
are:
o Sales growth: 3-5 percent (Represents organic growth,
without any significant contribution from acquisitions)
o Profit margins: average annual improvement of 40-50 basis
points in gross profit and operating profit margins
o Earnings per share growth: mid to high single digits
o Capital spending: 5-6 percent of sales (Down from an
average of 7.3 percent of sales over the last five years)
o Working capital: reduction of more than 200 basis points
long term versus 2002
o Return on investment capital (ROIC): increase more than
2 percentage points long term versus 2002
o Dividends: annual increases at a high single-digit to low
double-digit rate over the next five years
o Share repurchases: 2 percent of outstanding shares per
year (Depending on market conditions)
- more -
- 8 -
Mr. Falk continued, "With our new plan, we have a solid platform
in place for growing our business and applying greater financial
discipline. Longer term, it establishes a stronger foundation for
future growth through market share gains and new product breakthroughs.
"Given our tradition of innovation and our new, more rigorous
financial discipline, I'm confident we can achieve our top- and
bottom-line growth targets, continue to provide healthy dividend
increases and deliver superior value to our shareholders."
Conference call
A conference call to discuss this news release and other matters
of interest to investors and analysts will be held at 9 a.m. (CST)
today. The conference call will be simultaneously broadcast over the
World Wide Web. Stockholders and others are invited to listen to the
live broadcast or a playback, which can be accessed by following the
instructions set out in the Investors section of the company's Web site
(www.kimberly-clark.com).
About Kimberly-Clark
Kimberly-Clark and its well-known brands are an indispensable part
of life for people in more than 150 countries. Every day, one in four
people around the world trust K-C's brands to enhance their health,
hygiene and well-being -- brands such as Kleenex, Scott, Huggies,
Pull-Ups, Kotex and Depend. For the second consecutive year,
Kimberly-Clark has been named to Fortune magazine's list of "100 Best
Companies to Work For In America." With nearly 64,000 employees
worldwide, the company has received similar recognition in the U.K.,
Argentina, Australia, Czech Republic, Korea and Thailand. To keep up
with the latest K-C news and to learn more about the company's 131-year
history of innovation, visit www.kimberly-clark.com. Copies of
Kimberly-Clark's Annual Report to Stockholders, its proxy statements
and its other SEC filings, including Annual Reports on Form 10-K,
Quarterly Reports on Form 10-Q and Current Reports on Form 8-K,
- more -
- 9 -
are made available free of charge on the company's Web site on the same
day they are filed with the SEC. To view these filings, visit the
Investors section of the company's Web site.
Certain matters contained in this news release concerning the
business outlook, including new product introductions, cost savings and
acquisitions, anticipated financial and operating results, strategies,
contingencies and transactions of the company constitute
forward-looking statements and are based upon management's expectations
and beliefs concerning future events impacting the company. There can
be no assurance that these future events will occur as anticipated or
that the company's results will be as estimated. For a description of
certain factors that could cause the company's future results to differ
materially from those expressed in any such forward-looking statements,
see the section of Part I, Item 1 of the company's Annual Report on
Form 10-K for the year ended December 31, 2002 entitled "Factors That
May Affect Future Results."
- more -
- 10 -
KIMBERLY-CLARK CORPORATION
PERIOD ENDED JUNE 30
(Millions, except per share amounts)
EARNINGS SUMMARY:
There were no unusual items in the second quarter of 2003.
The following tables present the reconciliation of earnings before unusual
items to GAAP net income.
Three Months Ended
June 30, 2002
--------------------------------
Diluted
Income Earnings
(Expense) Per Share
--------------------------------
Earnings Before Unusual
Items............................................ $448.0 $ .86
Charges for Unusual Items:
Brazil
Tax Credits.................................... (13.5) (.03)
Business Improvement
Programs....................................... (9.9) (.02)
------ -----
Net Income......................................... $424.6 $ .81
====== =====
Average Diluted Common
Shares Outstanding............................... 522.6
- more -
- 11 -
KIMBERLY-CLARK CORPORATION
PERIOD ENDED JUNE 30
(Millions, except per share amounts)
Six Months Ended June 30
--------------------------------------------------------------------
2003 2002
------------------------------ ------------------------------
Diluted Diluted
Income Earnings Income Earnings
(Expense) Per Share (Expense) Per Share
--------- --------- --------- ---------
Earnings Before Unusual
Items.......................................... $826.1 $ 1.62 $904.1 $ 1.73
Charges for Unusual Items:
European Legal
Judgment..................................... (11.1) (.02) - -
Brazil
Tax Credits.................................. - - (13.5) (.03)
Change in Accounting
Principle.................................... - - (11.4) (.02)
Business Improvement
Programs..................................... - - (15.4) (.03)
------ ------ ------ ------
Net Income....................................... $815.0 $ 1.60 $863.8 $ 1.65
====== ====== ====== ======
Average Diluted Common
Shares Outstanding............................. 510.4 523.1
OTHER INFORMATION:
SIX MONTHS
ENDED JUNE 30
-----------------------------
2003 2002
------- -------
Cash Dividends Declared
Per Share...................................... $ .68 $ .60
Capital Spending................................. 402.1 382.0
AS OF JUNE 30
-----------------------------
2003 2002
------- -------
Number of Common Shares
Outstanding.................................... 507.0 517.2
Unaudited
- more -
- 12 -
KIMBERLY-CLARK CORPORATION
PERIOD ENDED JUNE 30
(Millions, except per share amounts)
Three Months
Ended June 30
----------------------------
2003 2002 Change
-------- -------- ------
Net Sales...................................................... $3,544.6 $3,408.9 + 4.0%
Cost of products sold........................................ 2,337.4 2,166.1 + 7.9%
-------- --------
Gross Profit................................................... 1,207.2 1,242.8 - 2.9%
Marketing, research and general
expenses................................................... 579.5 587.3 - 1.3%
Other (income) expense, net.................................. 20.8 31.2 N.M.
-------- --------
Operating Profit............................................... 606.9 624.3 - 2.8%
Interest income.............................................. 4.3 3.5 +22.9%
Interest expense............................................. (44.6) (45.1) - 1.1%
-------- --------
Income Before Income Taxes..................................... 566.6 582.7 - 2.8%
Provision for income taxes................................... 164.9 163.2 + 1.0%
-------- --------
Income Before Equity Interests................................. 401.7 419.5 - 4.2%
Share of net income of equity
companies.................................................. 30.3 21.5 +40.9%
Minority owners' share of
subsidiaries' net income................................... (14.7) (16.4) -10.4%
-------- --------
Net Income .................................................... $ 417.3 $ 424.6 - 1.7%
======== ========
Net Income Per Share - Diluted................................. $ .82 $ .81 + 1.2%
======== ========
- more -
- 13 -
KIMBERLY-CLARK CORPORATION
PERIOD ENDED JUNE 30
(Millions, except per share amounts)
Notes (Three Months):
1. In 2002, charges (credits) for unusual items are included as follows: cost
of products sold - $6.6 million; marketing, research and general
expenses - $8.5 million; other (income) expense, net - $26.5 million;
share of net income of equity companies - $1.4 million; and minority
owners' share of subsidiaries' net income - $(6.0) million.
2. The Corporation accounts for stock-based compensation using the
intrinsic-value method. The following presents pro forma information about
net income and earnings per share as if the Corporation had applied fair
value expense recognition to all employee stock options granted.
(Millions of dollars, except per share amounts) 2003 2002
--------------------------------------------------------------------------
Pro forma net income........................... $403.9 $406.4
Pro forma earnings per share - diluted......... .79 .78
N.M.-Not meaningful
Unaudited
- more -
- 14 -
KIMBERLY-CLARK CORPORATION
PERIOD ENDED JUNE 30
(Millions, except per share amounts)
Six Months
Ended June 30
----------------------------
2003 2002 Change
-------- ------- ------
Net Sales...................................................... $7,004.3 $6,739.8 + 3.9%
Cost of products sold........................................ 4,593.5 4,284.6 + 7.2%
-------- --------
Gross Profit................................................... 2,410.8 2,455.2 - 1.8%
Marketing, research and general
expenses................................................... 1,168.4 1,153.5 + 1.3%
Other (income) expense, net.................................. 56.2 12.5 N.M.
-------- --------
Operating Profit............................................... 1,186.2 1,289.2 - 8.0%
Interest income.............................................. 9.1 7.2 +26.4%
Interest expense............................................. (87.6) (91.8) - 4.6%
-------- --------
Income Before Income Taxes..................................... 1,107.7 1,204.6 - 8.0%
Provision for income taxes................................... 322.4 348.3 - 7.4%
-------- --------
Income Before Equity Interests................................. 785.3 856.3 - 8.3%
Share of net income of equity
companies.................................................. 56.3 53.9 + 4.5%
Minority owners' share of
subsidiaries' net income................................... (26.6) (35.0) -24.0%
-------- --------
Income Before Cumulative Effect
of Accounting Change......................................... 815.0 875.2 - 6.9%
Cumulative effect of accounting
change, net of income taxes.................................. - (11.4) N.M.
-------- --------
Net Income .................................................... $ 815.0 $ 863.8 - 5.6%
======== ========
Per Share Basis - Diluted:
Income Before Cumulative Effect
of Accounting Change....................................... $ 1.60 $ 1.67 - 4.2%
Cumulative effect of accounting
change, net of income taxes................................ - (.02) N.M.
-------- --------
Net Income................................................... $ 1.60 $ 1.65 - 3.0%
======== ========
- more -
- 15 -
KIMBERLY-CLARK CORPORATION
PERIOD ENDED JUNE 30
(Millions, except per share amounts)
Notes (Six Months):
1. In 2003, charges for unusual items are included as follows: other (income)
expense, net - $15.6 million.
2. In 2002, charges (credits) for unusual items are included as follows: cost
of products sold - $14.1 million; marketing, research and general
expenses - $9.9 million; other (income) expense, net - $26.5 million;
share of net income of equity companies - $1.4 million; minority owners'
share of subsidiaries' net income - $(7.3) million; and cumulative effect
of accounting change, net of income taxes - $11.4 million.
3. The Corporation accounts for stock-based compensation using the
intrinsic-value method. The following presents pro forma information about
net income and earnings per share as if the Corporation had applied fair
value expense recognition to all employee stock options granted.
(Millions of dollars, except per share amounts) 2003 2002
------------------------------------------------------------------------
Pro forma net income......................... $785.6 $828.9
Pro forma earnings per share - diluted...... 1.54 1.58
N.M.-Not meaningful
Unaudited
- more -
- 16 -
KIMBERLY-CLARK CORPORATION
SELECTED BUSINESS SEGMENT DATA
PERIOD ENDED JUNE 30
Three Months Six Months
Ended June 30 Ended June 30
------------------------------------ ------------------------------------
2003 2002 Change 2003 2002 Change
-------- -------- ------ -------- -------- ------
NET SALES:
Personal Care................... $1,328.9 $1,329.1 0.0% $2,611.4 $2,586.3 + 1.0%
Consumer Tissue................. 1,287.1 1,215.2 + 5.9% 2,612.4 2,470.0 + 5.8%
Business-to-
Business..................... 967.4 898.4 + 7.7% 1,855.2 1,751.3 + 5.9%
Intersegment
Sales........................ (38.8) (33.8) N.M. (74.7) (67.8) N.M.
-------- -------- -------- --------
Consolidated.................... $3,544.6 $3,408.9 + 4.0% $7,004.3 $6,739.8 + 3.9%
======== ======== ======== ========
OPERATING PROFIT: (a)
Personal Care................... $ 273.7 $ 293.3 - 6.7% $ 533.9 $ 557.4 - 4.2%
Consumer Tissue................. 197.9 221.0 -10.5% 431.7 466.2 - 7.4%
Business-to-
Business..................... 181.3 171.1 + 6.0% 325.8 331.0 - 1.6%
Other income (expense),
net.......................... (20.8) (31.2) N.M. (56.2) (12.5) N.M.
Unallocated items -
net.......................... (25.2) (29.9) N.M. (49.0) (52.9) N.M.
-------- -------- -------- --------
Consolidated.................... $ 606.9 $ 624.3 - 2.8% $1,186.2 $1,289.2 - 8.0%
======== ======== ======== ========
<FN>
Notes:
(a) Operating profit includes charges for unusual items as follows:
</FN>
Three Months Six Months
Ended June 30 Ended June 30
---------------- ---------------
2003 2002 2003 2002
---- ---- ---- ----
Personal Care.................................... $ - $ 4.6 $ - $ 8.0
Consumer Tissue.................................. - 7.3 - 11.5
Business-to-Business............................. - 3.2 - 4.5
Other income (expense),
net........................................... - 26.5 15.6 26.5
---- ----- ----- -----
Consolidated..................................... $ - $41.6 $15.6 $50.5
==== ===== ===== =====
- more -
- 17 -
Description of Business Segments
The Corporation is 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 Business-to-Business.
Each reportable segment is headed by an executive officer who reports to the
Corporation's Chief Executive Officer and is responsible for the development and
execution of global strategies to drive growth and profitability of the
Corporation's worldwide personal care, consumer tissue and business-to-business
operations. These strategies include global plans for branding and product
positioning, technology and research and development programs, cost reductions
including supply chain management, and capacity and capital investments for each
of these businesses. The principal sources of revenue in each of our global
business segments are described below.
The Personal Care segment manufactures and markets disposable diapers, training
and youth pants and swimpants; feminine and incontinence care products; and
related products. Products in this segment are primarily for household use and
are sold under a variety of brand names, including Huggies, Pull-Ups, Little
Swimmers, GoodNites, Kotex, Lightdays, Depend, Poise and other brand names.
The Consumer Tissue segment manufactures and markets facial and bathroom tissue,
paper towels and napkins for household use; wet wipes; and related products.
Products in this segment are sold under the Kleenex, Scott, Cottonelle, Viva,
Andrex, Scottex, Page, Huggies and other brand names.
The Business-to-Business segment manufactures and markets facial and bathroom
tissue, paper towels, wipers and napkins for away-from-home use; health care
products such as surgical gowns, drapes, infection control products,
sterilization wraps, disposable face masks and exam gloves, respiratory
products, and other disposable medical products; printing, premium business and
correspondence papers; specialty and technical papers; and other products.
Products in this segment are sold under the Kimberly-Clark, Kleenex, Scott,
Kimwipes, WypAll, Surpass, Safeskin, Tecnol, Ballard and other brand names.
N.M.-Not meaningful
Unaudited
- 18 -
KIMBERLY-CLARK CORPORATION
Supplemental Consolidated Information Reconciling Non-GAAP Financial Measures
To Reported (GAAP) Financial Measures in Earnings Press Release
of July 23, 2003
OUTLOOK FOR 2003
- ----------------
Estimated Full-Year 2003 Diluted Earnings Per Share
- ---------------------------------------------------
Earnings Per Share
Before Unusual items.............................. $3.36
European Legal Judgment.............................. (0.02)
Callable Bonds....................................... (0.02) - (0.03)
---------------
Earnings Per Share - Diluted......................... $3.32 - $3.31
===============
DEFINITIONS
- -----------
Net Debt and Preferred Securities
- ---------------------------------
Net debt is total debt less cash and cash equivalents and time deposits.
Return on Invested Capital (ROIC)
- ---------------------------------
ROIC is calculated based on the sum of annualized enterprise operating
profit(1), before unusual items, plus goodwill expense, on an after tax basis
divided by invested capital. Invested capital is calculated on an enterprise
basis(1) as the sum of accounts receivable, net; inventories; property, net; and
gross goodwill less accounts payable on a rolling average 12-month basis.
(1) As if equity companies were 100% owned by K-C.
Unaudited
# # #