Kimberly-Clark(US:KMB)2025-08-01 10:34Financial Performance - Net sales for Q2 2025 were $4.2 billion, a decrease of 1.6% year-over-year, primarily due to a 4.4% negative impact from divestitures and a 1.0% impact from foreign currency translation [4]. - Year-to-date sales were $8.2 billion, a decrease of 4.0%, with organic sales growth of 1.2% primarily from a 2.3% increase in volume [11]. - Net sales for Q2 2025 were $4,163 million, a decrease of 1.6% compared to $4,231 million in Q2 2024 [40]. - Net Sales for North America (NA) decreased by 1.9% to $2.730 billion in Q2 2025 from $2.783 billion in Q2 2024 [48]. - Total Operating Profit for the first half of 2025 was $1.223 billion, a decrease of 2.5% from $1.254 billion in the first half of 2024 [48]. Earnings and Profitability - Diluted earnings per share (EPS) attributable to Kimberly-Clark were $1.53, down from $1.61 in the prior year, with adjusted EPS decreasing by 2.0% to $1.92 [10]. - Basic earnings per share for Q2 2025 were $1.53, down 5.0% from $1.61 in Q2 2024 [40]. - Operating profit increased by 9.8% to $592 million in Q2 2025, compared to $539 million in Q2 2024 [40]. - Year-to-date operating profit was $1.2 billion, including $196 million of costs related to the transformation initiative, with adjusted operating profit down 4.7% [13]. - Adjusted Operating Profit for Q2 2025 was $713 million, slightly down from $729 million in Q2 2024 [58]. Margins and Cash Flow - Adjusted gross margin was 36.9%, down 180 basis points from the prior year, influenced by unfavorable pricing net of cost inflation [5]. - Operating cash flow for the first half of 2025 was $1,097 million, down from $1,459 million in the same period of 2024 [46]. - Adjusted free cash flow is anticipated to be approximately $2 billion in 2025 [30]. Strategic Initiatives - The company plans to continue its transformation strategy, which is expected to enhance sustainable growth and profitability [2]. - The company initiated a 2024 Transformation Initiative aimed at improving growth trajectory and profitability [56]. - The company expects 2025 organic sales growth to outpace the average growth in its categories, currently estimated at approximately 2% [26]. - The company anticipates challenges related to the pending IFP joint venture transaction and the 2024 Transformation Initiative, which may impact future performance [37]. Tax and Other Financial Metrics - The effective tax rate as reported for Q2 2025 was 22.6%, while the adjusted effective tax rate was 20.9% [59]. - Cash dividends declared increased by 3.3% to $1.26 per share in Q2 2025, compared to $1.22 in Q2 2024 [40]. - Total assets as of June 30, 2025, were $16,771 million, an increase from $16,546 million at the end of 2024 [44]. - Cash and cash equivalents decreased to $634 million as of June 30, 2025, from $1,010 million at the beginning of the period [46].