Kimberly-Clark(KMB) - 2025 Q3 - Quarterly Results

Financial Performance - Third quarter 2025 net sales were $4.2 billion, consistent with the prior year, with organic sales growth of 2.5% driven by 2.4% volume growth [4]. - Year-to-date sales totaled $12.4 billion, a decrease of 2.6%, primarily due to a 3.0% negative impact from divestitures and foreign currency translation [12]. - Net sales for Q3 2025 were $4,150 million, a slight increase of 0.1% compared to $4,144 million in Q3 2024 [40]. - For the nine months ended September 30, 2025, net sales were $12,367 million, a decrease of 2.6% from $12,701 million in the same period of 2024 [42]. - Total net sales for the nine months ended September 30, 2025, were $12,367 million, down 2.6% from $12,701 million in 2024 [48]. Profitability - Gross margin for the quarter was 36.0%, with an adjusted gross margin of 36.8%, down 170 basis points year-over-year due to pricing pressures and cost inflation [5]. - Diluted earnings per share (EPS) attributable to Kimberly-Clark were $1.34, down from $2.69 in the prior year, while adjusted EPS were $1.82, broadly in line with the previous year [11]. - Operating profit decreased by 39.5% to $621 million in Q3 2025 from $1,026 million in Q3 2024 [40]. - Net income attributable to Kimberly-Clark Corporation fell by 50.8% to $446 million in Q3 2025, down from $907 million in Q3 2024 [40]. - Operating profit for the nine months ended September 30, 2025, was $1,844 million, down 19.1% from $2,280 million in 2024 [42]. - Net income for the nine months ended September 30, 2025, was $1,539 million, a decrease of 27.6% compared to $2,126 million in 2024 [46]. Cash Flow and Capital Expenditures - Adjusted free cash flow is expected to be approximately $2 billion in 2025 [30]. - Cash provided by operations for the nine months ended September 30, 2025, was $1,805 million, down 25.4% from $2,417 million in 2024 [46]. - Capital spending for the nine months ended September 30, 2025, was $741 million, an increase of 44.7% compared to $512 million in 2024 [46]. - Cash and cash equivalents at the end of the period were $634 million, down 43% from $1,111 million at the end of the same period in 2024 [46]. Debt and Assets - Total debt as of September 30, 2025, was $7.3 billion, down from $7.4 billion as of December 31, 2024 [25]. - Total assets as of September 30, 2025, were $16,888 million, an increase from $16,546 million at the end of 2024 [44]. - Current liabilities increased to $7,077 million as of September 30, 2025, compared to $7,004 million at the end of 2024 [44]. Taxation - The Effective Tax Rate as reported for Q3 2025 was 45.4%, significantly higher than 19.4% in Q3 2024 [62]. - The Adjusted Effective Tax Rate for the nine months ended September 30, 2025, was 22.6%, compared to 21.7% in the same period of 2024 [62]. Transformation Initiative - The company initiated a 2024 Transformation Initiative aimed at improving growth trajectory and profitability [56]. - The company is focusing on its 2024 Transformation Initiative to enhance operational efficiency and drive future growth [61]. - The 2024 Transformation Initiative contributed $62 million to income from continuing operations in Q3 2025, compared to $(12) million in Q3 2024 [62].