Kimberly-Clark (KMB) Barclays 19th Annual Global Consumer Conference summary

Powering Care strategy and business performance

• Powering Care strategy focuses on pioneering innovation, optimizing margin structure, and wiring the organization for growth, aiming for superior value and leveraging global scale.

• Achieved consistent organic growth, with 10 consecutive quarters of volume and mix growth, expanded margins, and reduced earnings volatility.

• Premiumization in key markets like North America and China has driven category growth, with China’s premium segment rising from 6% in 2019 to over 50% today.

• Recent business environment is described as choppy, with increased promotional intensity and inventory adjustments impacting short-term results.

• Teams have demonstrated agility, with strong growth and share gains in markets such as India, Vietnam, Korea, and Indonesia despite headwinds in China and North America.

Financial outlook and cost management

• Third quarter is expected to see revenue contract in low single digits and a low teens decline in EPS versus prior year, driven by China headwinds, postponed innovation launches, distributor disruptions, and higher freight costs.

• Full-year guidance remains unchanged for now, with updates to be provided at the next earnings call if necessary.

• Long-term outlook for 2027 and 2028 remains in line with expectations, targeting mid to high single-digit EPS growth from 2028 onward.

• $150 million in incremental input cost inflation for the second half is being offset by pricing actions, tariff refunds, and other mitigating measures.

• Additional cost headwinds include $35–$40 million from freight and $10 million from Canadian tariffs, with ongoing efforts to manage PNOC neutrality.

Portfolio reshaping and innovation

• Joint venture with Suzano (Arbex) halves exposure to fiber-based inputs, reduces EPS volatility, and brings upfront cash for the Kenvue acquisition.

• Alternative natural fiber program promises superior product performance, environmental benefits, and lower cost volatility, with scalability being the next milestone.

• Disciplined capital allocation is applied to alternative fiber platforms, aiming to improve margins and reduce input cost volatility.