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Kimberly-Clark Annual Report, Year Ended Dec 31, 2002

Filing Date
Filed March 14, 2003
Period End
December 31, 2002
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 14, 2003. Cited figures are marked; the original filing is the authoritative source.

Kimberly-Clark Corporation's 10-K for fiscal 2002, dated March 14, 2003, reports net sales of $13,566.3 milliona, up from $13,287.6 million in 2001, with net income of $1,674.6 million, or $3.22 per diluted share, compared with $3.02 in 2001.

Operating profit rose to $2,463.8 millionb from $2,338.2 million. The company describes itself as a global consumer products company organized into three reportable segments: Personal Care ($5,101.7 million in net sales), Consumer Tissue ($5,018.6 million) and Business-to-Business ($3,593.0 million). Management cites intense competition, higher promotional spending, and a weak North American economy as pressures, while cash provided by operations rose to $2,424.2 million and capital spending fell to $870.7 million.

The filing also details several items affecting 2002 results, including $67 millionc of business improvement and other charges, a $21 million charge for the Safeskin securities litigation settlement, and a $26.5 million charge for purchased Brazilian tax credits later found to be invalid. Net income includes an $11.4 million after-tax cumulative effect charge from the adoption of EITF 01-9 on customer coupons. Long-term debt increased to $2,844.0 million, and the company repurchased 11.85 million shares for $675.5 million during 2002, with authority for an additional 20 million shares announced in February 2003.

For 2003, the outlook in the MD&A anticipates net sales rising in the low-to-mid single digits, cost reductions of $175 million to $200 milliond, an anticipated increase in pension costs of approximately $145 million, and capital spending of approximately $900 million. The company also states it expects to raise its dividend by 13.3 percent, marking its 31st consecutive annual increase.

02—Key points

Key Highlights

  1. Net sales of $13,566.3 million in 2002, up from $13,287.6 million in 2001; net sales rose 2.1 percent per the MD&A.
  2. Diluted EPS of $3.22 for 2002, compared with $3.02 in 2001; net income of $1,674.6 million.
  3. Operating profit of $2,463.8 million, with operating margin of 18.2 percent in 2002 versus 17.6 percent in 2001.
  4. Cash provided by operations of $2,424.2 million, and capital spending reduced to $870.7 million from $1,099.5 million.
  5. Share repurchases of 11.85 million shares for $675.5 million in 2002; an additional 20 million shares authorized in February 2003.
  6. 2003 outlook calls for low-to-mid single-digit net sales growth, $175 million to $200 million in cost reductions, and a 13.3 percent dividend increase.
  7. Wal-Mart Stores accounted for approximately 12 percent of 2002 net sales.

03—Questions

Frequently Asked Questions

  1. What drove the change in net sales in 2002?

    Consolidated net sales increased 2.1 percent over 2001. Excluding currency changes, net sales rose nearly 3 percent. Sales volumes increased approximately 5 percent, including the consolidation of Kimberly-Clark Australia, while net selling prices decreased about 2 percent, primarily due to higher promotional spending in North America.

  2. What one-time charges affected 2002 results?

    The Corporation recorded charges of approximately $67 million for business improvement and other programs and a litigation settlement. It also recorded a $21 million charge related to the Safeskin securities and shareholder derivative litigation settlement, and a $26.5 million charge for purchased Brazilian tax credits that were determined to be invalid.

  3. What is the company's 2003 outlook?

    Management expects 2003 to be another challenging year, with net sales rising in the low-to-mid single digits and cost reductions of $175 million to $200 million. Pension costs are anticipated to increase by approximately $145 million, and capital spending is planned at approximately $900 million.

  4. How is the company's debt and capital structure positioned?

    Long-term debt was $2,844.0 million at December 31, 2002, up from $2,424.0 million. The ratio of net debt and preferred securities to capital was 39.8 percent, within the target range of 35 to 45 percent. The company's long-term debt carries a Double-A rating.

  5. How does the company describe its business segments?

    Kimberly-Clark has three reportable segments: Personal Care, which includes Huggies, Kotex and Depend brands and had net sales of $5,101.7 million; Consumer Tissue, with Kleenex, Scott and Cottonelle brands and net sales of $5,018.6 million; and Business-to-Business, which includes health care and away-from-home products and had net sales of $3,593.0 million.

04—Continue

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