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Kenvue 8-K Report, Financial Results (Feb 8, 2024)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed February 8, 2024
Period End
February 8, 2024
Security
KVUE
In the record · 2023–202610-K310-Q128-K34

KVUE filed 3 annual reports (10-K), 12 quarterly reports (10-Q) and 34 current reports (8-K) between 2023 and 2026.

  1. Change in control8-K · Aug ’23Aug ’23
  2. Leadership change8-K · Jul ’24Jul ’24
  3. Leadership change8-K · Jun ’25Jun ’25
  4. Change in control8-K · Nov ’26Nov ’26

01—Abstract

Summary

Summary of the 8-K filed February 8, 2024. Cited figures are marked; the original filing is the authoritative source.

Kenvue Inc. (NYSE: KVUE) reported full-year 2023 net sales of $15.4 billiona, up 3.3% from the prior year, with organic growth of 5.0%.

The increase reflected 7.7% value realization partially offset by 2.7% volume declines. Full-year diluted earnings per share were $0.90b on a reported basis and $1.29 on an adjusted basis. Reported operating income margin fell to 16.3% from 17.9%, driven by separation-related costs, while adjusted operating income margin held at 22.4%.

Free cash flow for 2023 was $2.7 billionc on net cash from operating activities of $3.2 billion. Fourth-quarter results were weaker. Net sales decreased 2.7% to $3.7 billion, with organic growth of (2.4)%, as volume declined 8.2%.

The filing attributes about five points of that volume decline to unique factors, including lapping a strong cold, cough and flu season in the prior year, and the remaining three points mainly to softer performance in U.S. Skin Health and Beauty and continued softness in China. Fourth-quarter diluted EPS was $0.17d reported and $0.31 adjusted. Skin Health and Beauty adjusted operating income fell to $162 million from $92 million in the prior-year quarter, while Essential Health declined to $241 million from $290 million.

For 2024, Kenvue guided to reported net sales growth of 1.0% to 3.0% and organic growth of 2.0% to 4.0%, with organic growth expected to improve through the year. Adjusted diluted EPS is guided to $1.10 to $1.20 on a share count of 1.92 billion, and adjusted operating income margin is expected to be slightly below 2023.

Management highlighted increased brand investment and operating model optimization initiatives expected to contribute in the second half of the year. The press release is furnished under Item 2.02 and not deemed filed.

02—Key points

Key Highlights

  1. FY2023 net sales rose 3.3% to $15.4 billion, with organic growth of 5.0% driven by 7.7% value realization and 2.7% volume declines.
  2. Q4 2023 net sales decreased 2.7% to $3.7 billion, with organic growth of (2.4)% and volume down 8.2%.
  3. FY2023 reported diluted EPS was $0.90 versus adjusted diluted EPS of $1.29; Q4 reported EPS was $0.17 versus adjusted $0.31.
  4. Reported operating income margin fell to 16.3% from 17.9%, mainly due to separation-related costs, while adjusted operating income margin held at 22.4%.
  5. 2024 guidance calls for reported net sales growth of 1.0% to 3.0%, organic growth of 2.0% to 4.0%, and adjusted diluted EPS of $1.10 to $1.20.
  6. U.S. Skin Health and Beauty softness and continued weakness in China were cited as drivers of fourth-quarter volume declines.
  7. At December 31, 2023, cash and cash equivalents were $1.4 billion, total debt $8.3 billion, and net debt $6.9 billion.

03—Questions

Frequently Asked Questions

  1. How did Kenvue perform in full-year 2023?

    Net sales increased 3.3% to $15.4 billion, and organic growth was 5.0%. Reported diluted EPS was $0.90 and adjusted diluted EPS was $1.29. Free cash flow was $2.7 billion.

  2. Why did fourth-quarter sales decline?

    Q4 net sales fell 2.7% to $3.7 billion. The filing attributes about five points of the 8.2% volume decline to factors including lapping a strong prior-year cold and flu season, 2022 product discontinuations and customer inventory reductions. The remaining roughly three points reflect softer U.S. Skin Health and Beauty performance and continued softness in China.

  3. What is Kenvue's 2024 outlook?

    Kenvue expects reported net sales growth of 1.0% to 3.0% and organic growth of 2.0% to 4.0%, with organic growth improving sequentially. Adjusted diluted EPS is expected to be $1.10 to $1.20 on 1.92 billion diluted shares, and interest expense, net is expected to be about $400 million.

  4. Why did reported operating margin decline while adjusted margin held steady?

    Full-year reported operating income margin fell to 16.3% from 17.9%, driven by separation-related costs. Adjusted operating income margin was 22.4% in both years, as strong adjusted gross margin offset incremental public company costs and foreign currency headwinds.

  5. What did the filing say about the segments?

    Self Care grew organic net sales 8.4% for the year, Essential Health grew 3.6%, and Skin Health and Beauty grew 1.8%. In Q4, Skin Health and Beauty adjusted operating income rose to $162 million from $92 million, while Essential Health declined to $241 million from $290 million.

04—Continue

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