KMB Financial Analysis

Analysis Date: 1/29/2025

Business Model

Kimberly-Clark generates revenue through three main segments: North America (54.9%), International Personal Care (28.5%), and International Family Care & Professional (16.6%)

Revenue Sources

• North America ($11.0B): Baby & Child Care, Adult Care, Feminine Care, Family Care, Professional
• International Personal Care ($5.7B): Baby & Child Care, Feminine Care, Adult Care
• International Family Care & Professional ($3.3B): Family Care, Professional

Income Statement Analysis

• Net sales decreased 0.8% to $4.9B with organic sales growth of 2.3%
• Gross margin was 34.0%, adjusted gross margin improved 50bps to 35.4%
• Operating profit declined 18.2% due to higher marketing and transformation costs

Balance Sheet Analysis

• Total debt reduced to $7.4B from $8.0B in 2023
• Strong working capital management with improvements in cash conversion cycle
• Maintained solid balance sheet while returning $2.6B to shareholders

Cash Flow Analysis

• Generated strong adjusted free cash flow of $2.7B in 2024
• Capital spending decreased to $721M from $766M in 2023

Capital Allocation

Balanced capital allocation with $721M in capital expenditure, $1.6B in dividends, $1.0B in share repurchases, and $554M in debt repayments during 2024

Management Commentary

2024 was a breakthrough year with launch of transformative Powering Care strategy

Delivered organic top-line growth with upward inflection in volume-plus-mix

Strong productivity gains drove margin expansion and enabled higher investments

Overall Sentiment: Positive and confident about transformation progress and future growth potential

Recommendation

Rating: Buy

Reason for Rating: Strong execution of transformation strategy with improving margins and robust cash flow

Disclaimer: This analysis is based on company filings and public information. It is for informational purposes only and not financial advice. Past performance does not guarantee future results.

Generated on: 1/29/2025, 7:51:41 AM