We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Kimberly-Clark (KMB) Q2 Earnings Miss Mark, Sales Rise Y/Y
Read MoreHide Full Article
Kimberly-Clark Corporation (KMB - Free Report) reported second-quarter 2022 results, with the bottom line declining year over year and missing the Zacks Consensus Estimate. Nevertheless, the top line increased and beat the consensus mark. Although KMB delivered solid organic sales growth, with improvements across all segments, it witnessed the ongoing market volatility and major input cost inflation during the quarter.
Management raised its 2022 organic sales growth view and reiterated the guided ranges for both net sales and earnings.
KimberlyClark Corporation Price, Consensus and EPS Surprise
Adjusted earnings came in at $1.34 per share, missing the Zacks Consensus Estimate of $1.35. Moreover, the bottom line declined 9% from $1.47 per share in the year-ago quarter.
Kimberly-Clark’s sales came in at $5,063 million, beating the Zacks Consensus Estimate of $4,994.1 million. The metric rose 7% year over year. Unfavorable foreign currency rates affected sales 2%. Organic sales rose 9%, with net selling prices rising 9%, product mix increasing 1% but volumes declining 1%.
In North America, organic sales in consumer products rose 11% year over year, while the same increased 8% in the K-C Professional segment. Outside North America, organic sales went up 8% in the developing and emerging (D&E) markets. The metric rose 9% across the developed markets.
Operating profit came in at $621 million, up from $613 million reported in the year-ago quarter. Kimberly-Clark reported an adjusted operating profit of $676 million in the second quarter of 2021. The operating profit declined due to a rise in input costs to the tune of $405 million. Escalated marketing, research and general expenses, and unfavorable foreign currency also affected the operating profit. These were somewhat offset by organic sales growth and cost savings of $45 million from the FORCE (Focused on Reducing Costs Everywhere) program.
Segment Details
Personal Care: Sales of $2,710 million increased 8% year over year. Net selling prices improved 9%, product mix increased 1% but volume declined 1%. Unfavorable foreign currency rates hurt sales nearly 2% while the acquisition of the controlling interest in Thinx contributed 1 point to sales. Sales advanced 10% in North America and 7% in D&E markets. The metric increased 1% across developed markets outside North America, including Australia, South Korea and Western/Central Europe.
Consumer Tissue: Segment sales of $1,537 million rose 8% year over year. Net selling prices improved sales 7%, volumes grew 3% and product mix contributed 1 point to sales. Unfavorable currency rates reduced sales 3%. Sales rose 14% in North America, while the metric increased 4% in D&E markets. The metric was in line with the year-ago quarter’s figure across developed markets outside North America.
K-C Professional (KCP): Segment sales gained 5% to $802 million. Net selling prices improved 9%, while product mix benefited sales 2 points. Volumes hurt sales 3% in the segment. Changes in currency rates hurt sales 3%. Sales grew 8% in North America, while the same increased 4% in the D&E markets. The metric fell 3% in the developed markets outside North America.
Other Financial Updates
The currently Zacks Rank #3 (Hold) player ended the quarter with cash and cash equivalents of $311 million, long-term debt of $7,698 million and total stockholders’ equity of $742 million. Kimberly-Clark generated cash from operating activities of $944 million during the six months ended Jun 30, 2022. Management incurred capital expenditures of $217 million in the quarter under review.
Kimberly-Clark repurchased 173,000 million shares for $23 million in the reported quarter.
Image Source: Zacks Investment Research
2022 Outlook
Net sales in 2022 are still expected to grow 2-4% from the year-ago reported figure. Organic sales are now anticipated to increase 5-7%, up from the previous guidance of 4-6% growth. Unfavorable foreign currency exchange rates are likely to hurt net sales roughly 3%.
Management expects adjusted operating profit to be down mid-single digit percent. Earlier, management had expected the metric to be down low to mid-single digit percent. Key input costs are now estimated to escalate $1.4-$1.6 billion. Earlier, the metric was likely to increase $1.1-$1.3 billion. Management expects costs to rise or remain escalated for most inputs like pulp and other raw materials along with distribution as well as energy. Kimberly-Clark envisions 2022 earnings per share (EPS) in the lower end of the $5.60-$6.00 range, thanks to the present cost outlook.
The stock has dipped 2.9% in the past six months compared with the industry’s 10% decline.
Lamb Weston, which produces, distributes and markets value-added frozen potato products, sports a Zacks Rank #1 (Strong Buy) at present. LW has a trailing four-quarter earnings surprise of 18.1%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for LW’s current financial year sales suggests growth of 9.3% from the year-ago reported number.
Medifast, which manufactures and distributes weight loss, weight management, healthy living products and other consumable health and nutritional products, currently carries a Zacks Rank #2 (Buy). MED has a trailing four-quarter earnings surprise of 12.9%, on average.
The Zacks Consensus Estimate for Medifast’s current financial-year sales and EPS suggests growth of almost 19% and 13.4%, respectively, from the corresponding year-ago reported figures.
General Mills, which manufactures and markets branded consumer foods worldwide, currently carries a Zacks Rank of 2. GIS has a trailing four-quarter earnings surprise of 6.5%, on average.
The Zacks Consensus Estimate for General Mills’ current financial-year sales and EPS suggests growth of 1.9% and 1.8%, respectively, from the corresponding year-ago reported figures.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Kimberly-Clark (KMB) Q2 Earnings Miss Mark, Sales Rise Y/Y
Kimberly-Clark Corporation (KMB - Free Report) reported second-quarter 2022 results, with the bottom line declining year over year and missing the Zacks Consensus Estimate. Nevertheless, the top line increased and beat the consensus mark. Although KMB delivered solid organic sales growth, with improvements across all segments, it witnessed the ongoing market volatility and major input cost inflation during the quarter.
Management raised its 2022 organic sales growth view and reiterated the guided ranges for both net sales and earnings.
KimberlyClark Corporation Price, Consensus and EPS Surprise
KimberlyClark Corporation price-consensus-eps-surprise-chart | KimberlyClark Corporation Quote
Quarter in Detail
Adjusted earnings came in at $1.34 per share, missing the Zacks Consensus Estimate of $1.35. Moreover, the bottom line declined 9% from $1.47 per share in the year-ago quarter.
Kimberly-Clark’s sales came in at $5,063 million, beating the Zacks Consensus Estimate of $4,994.1 million. The metric rose 7% year over year. Unfavorable foreign currency rates affected sales 2%. Organic sales rose 9%, with net selling prices rising 9%, product mix increasing 1% but volumes declining 1%.
In North America, organic sales in consumer products rose 11% year over year, while the same increased 8% in the K-C Professional segment. Outside North America, organic sales went up 8% in the developing and emerging (D&E) markets. The metric rose 9% across the developed markets.
Operating profit came in at $621 million, up from $613 million reported in the year-ago quarter. Kimberly-Clark reported an adjusted operating profit of $676 million in the second quarter of 2021. The operating profit declined due to a rise in input costs to the tune of $405 million. Escalated marketing, research and general expenses, and unfavorable foreign currency also affected the operating profit. These were somewhat offset by organic sales growth and cost savings of $45 million from the FORCE (Focused on Reducing Costs Everywhere) program.
Segment Details
Personal Care: Sales of $2,710 million increased 8% year over year. Net selling prices improved 9%, product mix increased 1% but volume declined 1%. Unfavorable foreign currency rates hurt sales nearly 2% while the acquisition of the controlling interest in Thinx contributed 1 point to sales. Sales advanced 10% in North America and 7% in D&E markets. The metric increased 1% across developed markets outside North America, including Australia, South Korea and Western/Central Europe.
Consumer Tissue: Segment sales of $1,537 million rose 8% year over year. Net selling prices improved sales 7%, volumes grew 3% and product mix contributed 1 point to sales. Unfavorable currency rates reduced sales 3%. Sales rose 14% in North America, while the metric increased 4% in D&E markets. The metric was in line with the year-ago quarter’s figure across developed markets outside North America.
K-C Professional (KCP): Segment sales gained 5% to $802 million. Net selling prices improved 9%, while product mix benefited sales 2 points. Volumes hurt sales 3% in the segment. Changes in currency rates hurt sales 3%. Sales grew 8% in North America, while the same increased 4% in the D&E markets. The metric fell 3% in the developed markets outside North America.
Other Financial Updates
The currently Zacks Rank #3 (Hold) player ended the quarter with cash and cash equivalents of $311 million, long-term debt of $7,698 million and total stockholders’ equity of $742 million. Kimberly-Clark generated cash from operating activities of $944 million during the six months ended Jun 30, 2022. Management incurred capital expenditures of $217 million in the quarter under review.
Kimberly-Clark repurchased 173,000 million shares for $23 million in the reported quarter.
Image Source: Zacks Investment Research
2022 Outlook
Net sales in 2022 are still expected to grow 2-4% from the year-ago reported figure. Organic sales are now anticipated to increase 5-7%, up from the previous guidance of 4-6% growth. Unfavorable foreign currency exchange rates are likely to hurt net sales roughly 3%.
Management expects adjusted operating profit to be down mid-single digit percent. Earlier, management had expected the metric to be down low to mid-single digit percent. Key input costs are now estimated to escalate $1.4-$1.6 billion. Earlier, the metric was likely to increase $1.1-$1.3 billion. Management expects costs to rise or remain escalated for most inputs like pulp and other raw materials along with distribution as well as energy. Kimberly-Clark envisions 2022 earnings per share (EPS) in the lower end of the $5.60-$6.00 range, thanks to the present cost outlook.
The stock has dipped 2.9% in the past six months compared with the industry’s 10% decline.
Some Better-Ranked Staple Stocks
Some better-ranked stocks are Lamb Weston (LW - Free Report) , Medifast (MED - Free Report) and General Mills, Inc. (GIS - Free Report) .
Lamb Weston, which produces, distributes and markets value-added frozen potato products, sports a Zacks Rank #1 (Strong Buy) at present. LW has a trailing four-quarter earnings surprise of 18.1%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for LW’s current financial year sales suggests growth of 9.3% from the year-ago reported number.
Medifast, which manufactures and distributes weight loss, weight management, healthy living products and other consumable health and nutritional products, currently carries a Zacks Rank #2 (Buy). MED has a trailing four-quarter earnings surprise of 12.9%, on average.
The Zacks Consensus Estimate for Medifast’s current financial-year sales and EPS suggests growth of almost 19% and 13.4%, respectively, from the corresponding year-ago reported figures.
General Mills, which manufactures and markets branded consumer foods worldwide, currently carries a Zacks Rank of 2. GIS has a trailing four-quarter earnings surprise of 6.5%, on average.
The Zacks Consensus Estimate for General Mills’ current financial-year sales and EPS suggests growth of 1.9% and 1.8%, respectively, from the corresponding year-ago reported figures.