Kimberly-Clark(US:KMB)2025-08-01 13:00Financial Data and Key Metrics Changes - The second quarter was one of the strongest in recent history, with solid organic sales growth driven by the strongest volume quarter in the last five years [4] - The company gained weighted share and made significant share gains in several key categories in its largest markets [5] - Organic sales growth was primarily driven by innovation, with 85% of organic sales attributed to new product introductions [17] Business Line Data and Key Metrics Changes - North America exhibited durable growth, with branded consumption up 4.5% in the second quarter [33] - The Professional Business performed better than expected, contributing positively to overall performance [22] - The company experienced a 100 basis point increase in shipments in North America consumer, driven by retailer inventory shifts and innovation [25] Market Data and Key Metrics Changes - In international markets, frequency declines were noted, particularly in informal economies like Latin America, but demand remained stable in larger developed markets [16] - The weighted average category growth in North America and international personal care was around 2% [30] Company Strategy and Development Direction - The company is focused on delivering exceptional brand propositions across the value spectrum, meeting consumers' needs effectively [5] - A joint venture with Suzano is expected to unlock the full potential of international Family Care and Professional, allowing the company to focus on higher growth, higher margin businesses [7] - The company aims to enhance its capability to provide better care for a better world and create value for shareholders [8] Management's Comments on Operating Environment and Future Outlook - Management noted that purchasing power is under pressure for consumers, but demand for essential products remains resilient [13] - The company expects continued strong performance in the second half of the year, driven by a robust pipeline of innovations [18] - Management emphasized the importance of maintaining pricing net of commodity costs while focusing on volume and mix growth [40] Other Important Information - The company is targeting a gross productivity range of 5% to 6%, with 5.8% achieved in the second quarter [51] - Adjusted earnings per share are expected to benefit from favorable currency impacts and paused depreciation on discontinued operations [54] Q&A Session Summary Question: What drove the strong quarter and outlook for the second half? - Management highlighted that the strong performance was driven by great value propositions across all tiers and significant innovation, with 85% of organic sales growth attributed to new products [17][18] Question: Can you elaborate on North America's strong performance? - North America saw a 4.5% increase in consumption, with strong innovation and marketing execution driving the results [33][32] Question: What is the pricing outlook given the competitive environment? - Management stated that they are focused on maintaining pricing net of commodity costs and are not using pricing as a growth driver due to fixed consumption dynamics [40][42] Question: How does the joint venture with Suzano impact long-term growth? - The joint venture is expected to improve the company's ability to deliver consistent top-tier growth and enhance margins over time [69][72]