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KMB Stock Up 3.25% Following Release of Kimberly-Clark Year-End 2020 Results

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by Godfrey Benjamin · 3 min read
KMB Stock Up 3.25% Following Release of Kimberly-Clark Year-End 2020 Results
Photo: Depositphotos

Kimberly-Clark’s full-year 2020 net sales came up at $19.1 billion, showing a 4 percent increase, with organic sales up 6 percent. The organic sales for the fourth quarter grew by 5 percent. 

American multinational personal care corporation that produces mostly paper-based consumer products, Kimberly-Clark Corp (NYSE: KMB) has seen an increase in its stock price following the release of its better than expected year-end 2020 financial report. Per the official earnings released, the firm had a net sales of $4.8 billion for the fourth quarter, representing a 6 percent increment in the year-ago period.

Many companies are in the era of rolling out their financial report for the previous year. Quite a number of firms around the world have borne a brunt from the coronavirus pandemic, but many have managed to stay resilient through last year with redefined business and operational strategies. KMB reportedly pulled through the crises by a number of a targeted cost savings strategy.

“In 2020, we grew organic sales 6 percent, with healthy underlying performance and increased demand because of COVID-19. We also significantly increased brand investments and improved our market share positions. In addition, we achieved $575 million of cost savings and returned $2.15 billion to shareholders through dividends and share repurchases,” said Mike Hsu, Kimberly-Clark’s Chairman, and Chief Executive Officer.

Per the financials, Hsu noted that the firm grew its earnings per share by 12 percent, outperforming its mid-term projections. KMB’s full-year 2020 net sales came up at $19.1 billion, showing a 4 percent increase, with organic sales up 6 percent. The organic sales for the fourth quarter grew by 5 percent.

Diluted net income per share for the fourth quarter was $1.58 in 2020 as against $1.59 in the same time period in 2019. Full-year diluted net income per share was $6.87 in 2020 and $6.24 in 2019. Amidst these figures, KMB’s Full-year adjusted earnings per share were $7.74 in 2020, up 12 percent compared to $6.89 in 2019.

KMB Stock Boosted amidst Bullish Revenue Figures

Following the released earnings report, KMB stock closed up by 3.25% on Monday to $136.51 per share and complemented by another 0.36% push to $137 in the pre-market. While not all of KMB’s earnings performance was impressive across the board, the firm’s growth across its core business segments bolstered its current stock performance.

The personal care segment saw a $2.3 billion sales boost in the fourth quarter, representing an increase of 5 percent. Volumes increased 3 percent and net selling prices and product mix each improved 1 percent. The consumer tissue segment saw Fourth-quarter sales of $1.7 billion with a corresponding increment of 14 percent year-on-year. The K-C Professional (KCP) Segment decreased by 9 percent and volume plunged by 13 percent. This drop in KCP according to the company reflected lower away from home demand and challenging business conditions following the outbreak of COVID-19.

Kimberly-Clark 2021 Financial Year Outlook and Planning Assumptions

The firm is projecting a Net sales increase of 4 to 6 percent and an adjusted operating profit at or better than 2 percent. KMB also expects an adjusted non-operating expense to decrease year-on-year.

While the vaccination program is underway in the United States as well as other countries, businesses may come back to normal, returning KMB’s businesses to pre-pandemic levels and help attain the projected earnings guidance.

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