FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
DATE OF REPORT: NOVEMBER 21, 1997
(Date of earliest event reported)
KIMBERLY-CLARK CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 1-225 39-0394230
(State or other jurisdiction (Commission File (IRS Employer
of incorporation) Number) Identification No.)
P.O. BOX 619100, DALLAS, TEXAS 75261-9100
(Address of principal executive offices) (Zip Code)
(972) 281-1200
(Registrant's telephone number, including area code)
_____________________________________
Item 5. Other Events
Attached hereto as Exhibit 99 is a Press Release issued by Kimberly-
Clark Corporation on November 21, 1997 announcing a restructuring plan.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
KIMBERLY-CLARK CORPORATION
Date: November 25, 1997 By: /s/ Randy J. Vest
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Randy J. Vest
Vice President and
Controller
EXHIBIT INDEX
(99) Press Release issued by Kimberly-Clark Corporation on
November 21, 1997 announcing a restructuring plan.
Tina S. Barry
(972) 281-1484
KIMBERLY-CLARK ANNOUNCES MAJOR RESTRUCTURING
$590 MILLION PROGRAM TO STREAMLINE OPERATIONS, CREATE A SUPERIOR COST AND
DISTRIBUTION STRUCTURE
PLAN TO SUPPORT GROWTH THROUGH YEAR 2000 AND BEYOND
DALLAS, November 21, 1997 _ Kimberly-Clark Corporation (NYSE: KMB) today
announced a major restructuring plan that moves the company closer to
achieving its "stretch" financial target of doubling earnings per share
from operations between 1995 and the year 2000. The restructuring
includes the sale, closure or downsizing of up to 18 manufacturing
facilities worldwide and a workforce reduction of approximately 5,000
employees.
The plan is expected to reduce the company's operating costs by $200
million annually by the year 2000. The company said it will begin to
implement the restructuring immediately and record the plan's after-tax
cost of $590 million, or $1.06 per share, in the fourth quarter of 1997.
"As a result of this restructuring, Kimberly-Clark will be in a
better position than ever to take advantage of the strengths inherent in
its global brands and advantaged technologies," said Wayne R. Sanders,
chairman and chief executive officer. "Progress toward our long-term
financial goals has been hampered this year by transitional issues in our
away-from-home business, heightened competition in Europe and continued
low selling prices for our products around the world. Lower selling
prices alone will negatively impact our 1997 operating profit by about
$250 million compared to last year.
"We have examined all of our businesses worldwide and determined
that there are significant opportunities to lower costs and improve
operating efficiencies. Our plan is to create a superior cost and
distribution structure to support our growth through the year 2000 and
beyond. By consolidating facilities, we will eliminate excess, high-cost
production capacity and narrow our focus to advantaged technologies. We
also are setting the stage for the next generation of supply chain
savings, which will enable us to further streamline the way we distribute
our products and provide additional funds to invest in the growth of our
global brands.
"We will attempt to sell the facilities slated for consolidation
wherever possible," he said. "In all cases, we will do our utmost to see
that employees are treated fairly." Operations affected by the plan
include a tissue mill in Winslow, Maine, which the company plans to sell,
and another in Marinette, Wis., which is being downsized. Other
facilities will not be identified publicly until employees are notified.
The pretax amount of the restructuring charge is approximately $810
million. Restructuring of the company's tissue operations accounts for
about 70 percent of the total, and most of the remainder relates to the
company's personal care operations. The program is worldwide in scope,
with approximately 60 percent of the cost targeted for North America.
The workforce reduction will affect approximately 7 percent of employees
worldwide.
The restructuring plan calls for consolidation of manufacturing
operations into fewer, larger, more productive facilities. These actions
will also eliminate excess production capacity, including more than
200,000 metric tons of high-cost tissue manufacturing capacity. The
excess tissue capacity stems from productivity improvements and
installation of new technology -- additions which have outpaced growth in
demand for the company's products since the merger with Scott Paper
Company in late 1995. The company has sufficient capacity for its tissue
businesses and will add modern, low-cost capacity as necessary to support
future growth.
Plans also have been developed to generate incremental savings at
ongoing facilities, with a goal to lower costs and improve productivity
to best ever levels. The company expects the restructuring will simplify
its distribution structure and enable it to further streamline its
dealings with suppliers and customers, thereby generating additional
efficiencies.
Cash outlays for severance, removal of equipment and other actions
comprise approximately 35 percent of the total charge and will be
incurred over the next one to two years. The balance of the charge is
primarily for asset write-offs. The income tax benefit of the
restructuring charge is estimated to be $220 million, or 27 percent of
the pretax amount.
The cumulative after-tax cash cost of the restructuring charge is
expected to be less than $100 million. Planned pretax savings are
expected to exceed $100 million in 1998 and rise to approximately $200
million in the year 2000. The company anticipates that more than 80
percent of the savings will be realized in cash.
The restructuring charge and savings include amounts related to the
proposed combination of the company's Professional Health Care operations
with those of Tecnol Medical Products, Inc., assuming the Tecnol
acquisition is approved by its shareholders on December 18, 1997.
Mr. Sanders said, "With this restructuring, we are taking aggressive
steps to ensure our results improve from this point forward. As the
savings ramp up, they will begin to offset the lower selling prices we
have experienced this year. At the same time, we plan to grow our core
businesses more aggressively, expanding their reach to every growth
market in the world. We are committed to achieving our long-term goals
and, in the process, creating significant value for our shareholders and
the brightest possible future for more than 60,000 employees worldwide."
A Fortune 100 company, Kimberly-Clark is a leading global
manufacturer of personal care, consumer tissue and away-from-home
products. The company's global brands include Huggies, Pull-Ups, Kotex,
Depend, Kleenex, Scott, Kimwipes and WypAll. Other brands well-known
outside the U.S. include Andrex, Scottex, Page, Popee, and Kimbies.
Kimberly-Clark also is a major producer of professional health care
products and premium business, correspondence and technical papers. The
company has manufacturing operations in 37 countries and sells its
products in more than 150 countries.
Certain matters contained in this news release concerning the
business outlook, anticipated financial and operating results and
contemplated transactions of the company constitute forward-looking
statements and are based upon management's expectations and beliefs
concerning future events impacting the company. For a description of
certain factors that could cause the company's future results to differ
materially from those expressed in any such forward-looking statements,
see the section of Part I, Item 1 of the company's Annual Report on Form
10-K for the year ended December 31, 1996 entitled "Factors That May
Affect Future Results."
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