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Kimberly-Clark Annual Report, Year Ended Dec 31, 1993

Filing Date
Filed March 24, 1994
Period End
December 31, 1993
Security
KMB
In the record · 2016–202610-K1110-Q328-K111

KMB filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 111 current reports (8-K) between 2016 and 2026.

  1. FY2016 annual report10-K · Feb ’17Feb ’17
  2. Leadership change8-K · Sep ’19Sep ’19
  3. Change in control8-K · Sep ’21Sep ’21
  4. Leadership change8-K · Nov ’25Nov ’25

01—Abstract

Summary

Summary of the 10-K filed March 24, 1994. Cited figures are marked; the original filing is the authoritative source.

Kimberly-Clark Corporation's 10-K for the fiscal year ended December 31, 1993 reports net sales of $6,972.9 milliona, down from $7,091.1 million in 1992, while net income rose to $510.9 million ($3.18 per share) from $135.0 million ($0.84 per share).

The 1992 comparison was depressed by a $250.0 millionb pretax restructuring charge and a $210.0 million cumulative effect of accounting changes. Operating profit was $793.5 million, or 11.4% of net sales, versus 7.7% in 1992. The company attributed the sales decline to lower selling prices and currency translation, and cited a $147 million currency translation effect on sales.

Management described Huggies diapers as the number one selling U.S. brand, though it flagged more intense competition in training pants in 1994 and heavy investment to launch diapers in Europe. Balance sheet and cash flow data show total assets of $6,380.7 millionc, long-term debt of $933.1 million, and stockholders' equity of $2,457.2 million. Cash provided by operations was $746.7 million against capital spending of $654.5 million.

The ratio of total debt to capital was 39.1%, outside the company's 28 to 32 percent target range, and the company reported a Double-A rating on its long-term debt. Dividends paid totaled $1.70d per share in 1993, compared with $1.29 declared, and the company has 25,121 stockholders of record. Legal and environmental matters are disclosed in the filing, including retiree medical benefit litigation, asbestos suits involving about 4,713 individuals, a patent suit against Drypers Corporation with trial set for June 7, 1994, and potentially responsible party designations at 21 waste disposal sites, none of which management believes would have a material adverse effect.

02—Key points

Key Highlights

  1. Net income rose to $510.9 million ($3.18 per share) in 1993 from $135.0 million ($0.84 per share) in 1992, which included a $250.0 million pretax restructuring charge and $210.0 million in cumulative accounting change effects.
  2. Net sales declined 1.7% to $6,972.9 million, reflecting lower selling prices and currency translation, which the company estimated reduced consolidated sales by $147 million.
  3. Operating profit reached $793.5 million, or 11.4% of net sales, compared with 7.7% in 1992.
  4. Cash provided by operations was $746.7 million against capital spending of $654.5 million.
  5. The ratio of total debt to capital was 39.1%, above the company's 28 to 32 percent target range, and long-term debt carries a Double-A rating.
  6. Management expects more intense competition in disposable training pants in 1994 and plans heavy investment to support training pant introductions and the 1994 launch of diapers in Europe.
  7. The company faces a potentially responsible party designation at 21 waste disposal sites and asbestos-related suits involving about 4,713 individuals, which management does not expect to be material.

03—Questions

Frequently Asked Questions

  1. Why did net income increase so sharply in 1993?

    The 1992 results included a $250.0 million pretax restructuring charge ($172.0 million after tax, or $1.07 per share) and a $210.0 million net after-tax charge for cumulative effects of accounting changes. Excluding these items, the filing states that 1993 net income declined 1.2 percent.

  2. What drove the decline in net sales?

    Management attributed the decline to lower selling prices, particularly for Huggies diapers in the U.S., feminine care products, facial tissue and tobacco industry papers, as well as currency translation, which it estimated reduced consolidated sales by $147 million. Sales volumes increased 2.6 percent.

  3. How is the company's debt position?

    Long-term debt was $933.1 million at December 31, 1993, and debt payable within one year was $684.8 million. The total debt to capital ratio was 39.1%, outside the target range of 28 to 32 percent, which management attributed in part to the 1992 restructuring and accounting changes. The company's long-term debt securities have a Double-A rating.

  4. What are the main risks flagged in the filing?

    The filing cites intensifying competition in training pants from private-label and economy brands and a major competitor's branded training pant, uncertainty over proposed secondary fiber legislation for newsprint and paper, and a patent suit against Drypers Corporation with a trial date set for June 7, 1994. Environmental and asbestos matters are disclosed but are not expected to be material.

04—Continue

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