FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended MARCH 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period fromto
Commission file number 1-225
KIMBERLY-CLARK CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 39-0394230
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) 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)
NO CHANGE
(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X. No.
-------
AS OF MAY 8, 1998, 557,143,292 SHARES OF THE CORPORATION'S COMMON STOCK WERE
OUTSTANDING.
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
CONSOLIDATED INCOME STATEMENT
KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES
Three Months
Ended March 31
-------------------------
(Millions of dollars except per share amounts) 1998 1997
- --------------------------------------------------------------------
<S> <C> <C>
NET SALES $3,048.6 $3,237.6
Cost of products sold 1,884.1 1,996.6
--------- ---------
GROSS PROFIT 1,164.5 1,241.0
Advertising, promotion and selling
expenses 494.9 498.3
Research expense 52.9 48.7
General expense 158.2 149.7
Restructuring and other unusual charges 14.2 -
--------- ---------
OPERATING PROFIT 444.3 544.3
Interest income 8.6 8.6
Interest expense (48.2) (43.3)
Other income (expense), net (0.3) 8.7
--------- ---------
INCOME BEFORE INCOME TAXES 404.4 518.3
Provision for income taxes 129.6 171.0
--------- ---------
INCOME BEFORE EQUITY INTERESTS 274.8 347.3
Share of net income of equity companies 29.3 32.5
Minority owners' share of subsidiaries'
net income (6.5) (15.6)
--------- ---------
INCOME BEFORE EXTRAORDINARY GAIN 297.6 364.2
Extraordinary gain, net of income taxes - 4.8
--------- ---------
NET INCOME $297.6 $369.0
========= =========
PER SHARE BASIS:
BASIC:
Income before extraordinary gain $.53 $.65
Extraordinary gain, net of income taxes - .01
--------- ---------
Net income $.53 $.66
========= =========
DILUTED:
Income before extraordinary gain $.53 $.64
Extraordinary gain, net of income taxes - .01
--------- ---------
Net income $.53 $.65
========= =========
CASH DIVIDENDS DECLARED $.25 $.24
========= =========
Unaudited
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CONDENSED CONSOLIDATED BALANCE SHEET
KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES
MARCH 31, December 31,
(Millions of dollars) 1998 1997
- ----------------------------------------------------------------------------
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents $99.3 $90.8
Accounts receivable 1,563.9 1,606.3
Inventories 1,295.9 1,319.5
Other current assets 453.5 472.4
--------- ---------
TOTAL CURRENT ASSETS 3,412.6 3,489.0
PROPERTY 9,870.9 9,756.2
Less accumulated depreciation 4,249.3 4,155.6
--------- ---------
NET PROPERTY 5,621.6 5,600.6
INVESTMENTS IN EQUITY COMPANIES 596.2 567.7
ASSETS HELD FOR SALE 282.7 280.0
GOODWILL, DEFERRED CHARGES AND OTHER ASSETS 1,376.0 1,328.7
--------- ---------
$11,289.1 $11,266.0
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Debt payable within one year $568.2 $663.1
Accounts payable 918.2 1,049.4
Accrued expenses 1,393.5 1,445.6
Other current liabilities 635.8 548.2
--------- ---------
TOTAL CURRENT LIABILITIES 3,515.7 3,706.3
LONG-TERM DEBT 1,805.7 1,803.9
NONCURRENT EMPLOYEE BENEFIT AND OTHER OBLIGATIONS 890.3 887.1
DEFERRED INCOME TAXES 602.7 580.8
MINORITY OWNERS' INTERESTS IN SUBSIDIARIES 175.6 162.6
STOCKHOLDERS' EQUITY 4,299.1 4,125.3
--------- ---------
$11,289.1 $11,266.0
========= =========
Unaudited
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES
Three Months
Ended March 31
--------------
(Millions of dollars) 1998 1997
- -----------------------------------------------------------------
<S> <C> <C>
OPERATIONS
Net Income $297.6 $369.0
Restructuring and other unusual charges 14.2 -
Depreciation 123.6 120.9
Changes in operating working capital (39.7) (220.7)
Extraordinary gain, net of income taxes - (4.8)
Pension funding in excess of expense (3.6) (6.0)
Other 14.6 47.7
-------- --------
CASH PROVIDED BY OPERATIONS 406.7 306.1
-------- --------
INVESTING
Capital spending (135.3) (179.8)
Disposals of property and businesses - 606.3
Other (30.0) (61.4)
-------- --------
CASH PROVIDED BY (USED FOR) INVESTING (165.3) 365.1
-------- --------
FINANCING
Cash dividends paid (131.4) (129.7)
Changes in debt payable within one year (52.9) (237.2)
Increases in long-term debt 220.5 18.1
Decreases in long-term debt (261.6) (36.3)
Proceeds from exercise of stock options 18.2 33.8
Acquisitions of common stock for the treasury (9.1) (255.6)
Other (16.6) 13.6
-------- --------
CASH USED FOR FINANCING (232.9) (593.3)
-------- --------
INCREASE IN CASH AND CASH EQUIVALENTS $8.5 $77.9
======== ========
Unaudited
See Notes to Financial Statements.
</TABLE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS
KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES
1. The unaudited consolidated financial statements of Kimberly-Clark
Corporation (the "Corporation") have been prepared on the same basis as those
in the 1997 Annual Report to Stockholders and include all adjustments
necessary to present fairly the condensed consolidated balance sheet,
consolidated results of operations and condensed consolidated cash flow
statements for the periods indicated.
2. In the fourth quarter of 1997, the Corporation announced a plan to
restructure its worldwide operations ("Announced Plan"), the total pretax cost
of which was estimated at $810.0 million. In conjunction with the Announced
Plan, the Corporation recorded a 1997 pretax charge of $701.2 million. The
remaining costs of the Announced Plan will be recorded when such costs result
in accruable expenses. During the first quarter of 1998, the Corporation
recorded a pretax charge of $14.2 million related to the Announced Plan. The
1998 charge reduced first quarter 1998 net income by $9.4 million, or $.02 per
share.
3. In March 1997, the Corporation sold its non-core pulp and newsprint
facility located in Coosa Pines, Alabama, for approximately $600 million. In
the first quarter of 1997, the Corporation recorded impairment losses totaling
$111.5 million before income tax benefits on the planned disposal of a pulp
manufacturing mill in Miranda, Spain; a recycled fiber facility in Oconto
Falls, Wisconsin; and a tissue converting facility in Yucca, Arizona; and on
an integrated pulp making facility in Everett, Washington. These transactions
have been aggregated and reported as an extraordinary gain totaling $4.8
million, net of applicable income taxes of $16.0 million, or $.01 per share.
4. There are no adjustments required to be made to Income Before
Extraordinary Gains for purposes of computing basic and diluted earnings per
share ("EPS"). A reconciliation of the average number of common shares
outstanding used in the basic and diluted EPS computations is as follows:
<TABLE>
<CAPTION>
Average Common Shares
Outstanding for the
Three Months Ended March 31
-------------------------------
(Millions) 1998 1997
- -------------------------------------------------------------
<S> <C> <C>
Basic 556.7 560.8
Dilutive effect of stock options 3.0 3.6
Dilutive effect of shares issued for
participation share awards 0.3 0.1
----- -----
Diluted 560.0 564.5
===== =====
</TABLE>
Options to purchase 3,062,100 shares of common stock at $55.9375 per
share were outstanding during the first quarter of 1998 but were not included
in the computation of diluted EPS because the options' exercise price was
greater than the average market price of the common shares. The options,
which expire on February 26, 2008, were still outstanding at March 31, 1998.
The number of common shares outstanding at March 31, 1998 and 1997, was 557.0
million and 559.5 million, respectively.
<PAGE>
5. The following schedule details inventories by major class as of March
31, 1998 and December 31, 1997:
MARCH 31, December 31,
(Millions of dollars) 1998 1997
- ------------------------------------------------------------------------------
At lower of cost on the First-In,
First-Out (FIFO) method or market:
Raw materials $ 353.0 $ 372.4
Work in process 214.3 228.5
Finished goods 752.1 749.9
Supplies and other 188.0 174.5
--------- ---------
1,507.4 1,525.3
Excess of FIFO cost over Last-In,
First-Out (LIFO) cost (211.5) (205.8)
--------- ----------
Total $ 1,295.9 $ 1,319.5
========= ==========
6. The following schedule provides the detail of comprehensive income:
Three Months Ended March 31
-------------------------------
(Millions of dollars) 1998 1997
- ------------------------------------------------------------------------------
Net Income $ 297.6 $ 369.0
Unrealized currency translation adjustments (4.1) (73.9)
-------- ---------
Comprehensive income $ 293.5 $ 295.1
======== =========
<PAGE>
7. The following schedule presents information concerning consolidated
operations by business segment for the three months ended March 31:
(Millions of dollars) 1998(a) 1997
---------------------------------------------------------------------------
NET SALES:
Personal Care Products $ 1,331.4 $ 1,262.7
Tissue-Based Products 1,565.5 1,765.0
Newsprint, Paper and Other 165.1 224.5
Intersegment sales (13.4) (14.6)
----------- -----------
Consolidated $ 3,048.6 $ 3,237.6
=========== ===========
OPERATING PROFIT:
Personal Care Products $ 212.9 $ 250.8
Tissue-Based Products 205.0 253.8
Newsprint, Paper and Other 37.1 40.8
Unallocated items - net (10.7) (1.1)
----------- -----------
Consolidated $ 444.3 $ 544.3
=========== ===========
(a) Operating profit for the quarter for Personal Care Products and
Tissue-Based Products includes $4.9 million and $9.3 million, respectively, of
the charge related to the Announced Plan described in Note 2.
Description of Product Segments:
Personal Care Products includes infant, child, feminine and incontinence care
products; wet wipes; health care products; and related products.
Tissue-Based Products includes tissue and wipers for household and
away-from-home use; pulp; and related products.
Newsprint, Paper and Other includes newsprint, printing papers, premium
business and correspondence papers, specialty papers, technical papers, and
related products; and other products and services.
Unaudited
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
Management believes that the following commentary and tables appropriately
discuss and analyze the comparative results of operations and the financial
condition of the Corporation for the periods covered.
RESULTS OF OPERATIONS:
FIRST QUARTER OF 1998 COMPARED WITH FIRST QUARTER OF 1997
By Business Segment
(Millions of dollars)
For a description of the Corporation's business segments and a summary of the
business segment data that include restructuring and other unusual charges,
see Note 7 to the Financial Statements. For purposes of this Management's
Discussion and Analysis, restructuring and other unusual charges is shown
separately in the following business segment and geographic presentations to
facilitate a meaningful discussion of ongoing operations.
<TABLE>
<CAPTION>
% Change % OF 1998
NET SALES 1998 vs. 1997 CONSOLIDATED
- -----------------------------------------------------------------------
<S> <C> <C> <C>
Personal Care Products $1,331.4 + 5.4% 43.6%
Tissue-Based Products 1,565.5 -11.3 51.4
Newsprint, Paper and Other 165.1 -26.5 5.4
Intersegment sales (13.4) (.4)
--------- -------
Consolidated $3,048.6 - 5.8% 100.0%
========= =======
</TABLE>
<TABLE>
<CAPTION>
% Change % OF 1998 % Return on Sales
--------------------
OPERATING PROFIT 1998 vs. 1997 CONSOLIDATED 1998 1997
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Personal Care Products $217.8 -13.2% 49.0% 16.4% 19.9%
Tissue-Based Products 214.3 -15.6 48.2 13.7 14.4
Newsprint, Paper and Other 37.1 - 9.1 8.4 22.5 18.2
Restructuring and other
unusual charges (14.2) (3.2)
Unallocated items-net (10.7) (2.4)
------- ------
Consolidated $444.3 -18.4% 100.0% 14.6% 16.8%
======= ======
</TABLE>
Commentary:
Net sales for the quarter were 5.8 percent lower than in 1997; however,
excluding the revenues of the Coosa Pines, Alabama newsprint and pulp
operation ("Coosa") and the Corporation's 50.1 percent interest in Scott
Paper Limited in Canada, businesses which were divested in 1997, first
quarter net sales increased slightly. Excluding the net sales of divested
businesses, worldwide sales volumes increased 4 percent and selling
prices were nearly 1 percent higher. Changes in currency exchange
rates are estimated to have reduced consolidated net sales by approximately
$150 million, substantially offsetting the volume and selling price increases.
- - Worldwide sales of personal care products increased approximately 5
percent from 1997, as an increase in sales volumes of 10 percent was halved by
negative foreign currency exchange rate effects. Sales volume growth was
achieved in most international markets; in professional health care, due in
part to the acquisition of Tecnol Medical Products Inc. in December 1997; and
in baby wipes and training and youth pants in North America. However, diaper
volumes in North America were below last year's record levels.
- - Worldwide sales of tissue-based products excluding divested businesses
were 4 percent lower than in 1997 primarily because of changes in foreign
currency exchange rates. Sales volumes were flat overall, with increases in
Latin America and for Kleenex facial tissue and the Corporation's new Kleenex
Cottonelle bathroom tissue in North America and decreases for consumer tissue
products in Europe and the Asia/Pacific region.
Operating profit decreased 18.4 percent in absolute terms, and from 16.8
percent to 14.6 percent as a percentage of net sales. Excluding the
restructuring and other unusual charges of $14.2 million recorded
in 1998, which are part of the remaining $108.8 million of charges
to complete the $810.0 million restructuring program announced in
November 1997 ("Announced Plan"), operating profit decreased 15.8 percent in
absolute terms, and from 16.8 percent to 15.0 percent as a percentage of net
sales. Further, excluding the divested businesses, operating profit declined
12.6 percent.
- - The decline in operating profit for personal care products was
primarily due to investment spending to start up new diaper capacity and to
launch improved diapers and feminine care products in Europe; the lower
volumes and increased manufacturing costs for diapers in North America; and
the currency effects in Asia.
- - The decline in first quarter operating profit for tissue-based products
was a result of lower earnings in Europe, the loss of earnings of divested
businesses and the Asian currency effects, which combined, more than offset
higher earnings of the Corporation's away-from-home business in North America.
- - The overall changes in currency exchange rates, primarily in Asia, are
estimated to have reduced consolidated operating profit
approximately $20 million.
- - Operating profit for the 1998 quarter for Personal Care Products and
Tissue-Based Products includes $4.9 million and $9.3 million, respectively, of
the charge related to the Announced Plan.
<PAGE>
<TABLE>
<CAPTION>
By Geography
(Millions of dollars)
% Change % OF 1998
NET SALES 1998 vs. 1997 CONSOLIDATED
- ----------------------------------------------------------
<S> <C> <C> <C>
North America $2,100.3 - 6.7% 68.9%
Outside North America 1,018.8 - 5.7 33.4
Intergeographic sales (70.5) (2.3)
--------- -----
Consolidated $3,048.6 - 5.8% 100.0%
========= =====
</TABLE>
<TABLE>
<CAPTION>
% Change % OF 1998 % Return on Sales
--------------------
OPERATING PROFIT 1998 vs. 1997 CONSOLIDATED 1998 1997
- ------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
North America $416.5 - 8.5% 93.7% 19.8% 20.2%
Outside North America 52.7 -41.4 11.9 5.2 8.3
Restructuring and other
unusual charges (14.2) (3.2)
Unallocated items-net (10.7) (2.4)
------ -----
Consolidated $444.3 -18.4% 100.0% 14.6% 16.8%
====== =====
</TABLE>
Commentary:
- - Excluding the divested businesses, net sales for North America increased
2.2 percent. The decline in net sales outside North America is primarily due
to the currency effects in Asia.
- - Excluding the divested businesses and the restructuring charge,
operating profit in North America decreased 4.4 percent, primarily due to the
lower volumes and increased manufacturing costs for diapers. The decline in
operating profit outside North America is primarily due to the previously
discussed substantially lower earnings in Europe.
- - Of the $14.2 million of restructuring and other unusual charges recorded
in 1998,$8.5 million was incurred in North America, the remainder
was incurred outside North America.
Additional Income Statement Commentary:
- - The increase in interest expense is primarily attributable to a higher
debt level and higher interest rates internationally.
- - The effective income tax rate decreased to 32.0 percent from 33.0
percent in the prior year and is expected to remain at approximately 32
percent for the balance of 1998. The lower effective tax rate is primarily
due to additional tax planning opportunities.
- - The 9.8 percent decrease in the Corporation's share of net income of
equity companies is principally due to a charge of $3.8 million related to the
change in the value of the Mexican peso. Excluding this charge, the
Corporation's share of net income of equity companies was $33.1 million in the
first quarter of 1998 compared with $32.5 million in 1997. Improved product
pricing at the Corporation's Mexican affiliate, Kimberly-Clark de Mexico, S.A.
de C.V., resulted in better equity company net income. The higher net income
in Mexico was partially offset by lower earnings of other equity companies.
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
- - Cash provided by operations in the first quarter of 1998 increased by
$100.6 million compared with the first quarter of 1997, primarily due to a
reduced investment in working capital which more than offset the lower
contribution from net income.
- - At March 31, 1998, $573.2 million of the charge for the estimated costs
of the restructuring program announced in November 1997 remain to be utilized.
These reserves for restructuring and other unusual charges are estimated to be
adequate to cover the planned actions.
- - The first quarter of 1997 included approximately $600 million in
proceeds from the sale of Coosa.
- - During the first quarter of 1997, the Corporation repurchased 5 million
shares of its common stock for approximately $250 million. No share
repurchases were made during the first quarter of 1998. Depending on market
conditions, the Corporation intends to repurchase additional shares beginning
in the second quarter of 1998 under its existing authority to purchase up to
15.5 million shares of common stock.
- - The Corporation reduced its debt levels in the first quarter of 1998
resulting in a debt to capital ratio of 34.7 percent at March 31, 1998
compared with 36.5 percent at year-end 1997. This ratio is consistent with
the Corporation's objective of maintaining a total debt to capital ratio in
the range of 30 to 40 percent.
- - Management believes cash flow from operations plus the ability to issue
both short-term and long-term debt will be sufficient to fund capital
expenditures, pay dividends, meet debt maturity requirements, fund business
acquisitions and allow the Corporation to continue its previously announced
share repurchase program.
- - On May 5, 1998, the Corporation announced that it will shut down its
pulp mill in Mobile, Alabama in September 1999 and will sell the associated
woodlands operations. This action is expected to result in a net gain. As a
result of the shutdown, the Corporation will no longer be required to invest
approximately $260 million at such facility to comply with newly issued
environmental regulations for pulp mills. It is expected that the closure of
the pulp mill will reduce the percentage of virgin fiber the Corporation
produces for use in its products from nearly 70 percent to about 45 percent.
The Corporation reiterated that it plans to sell its pulp mills in Terrace
Bay, Ontario and Miranda, Spain, but said it will continue to operate pulp
mills in Everett, Washington and Pictou County, Nova Scotia. The Corporation
also announced that it will continue to operate its Mobile tissue mill and
plans to invest approximately $100 million in such facility over the next
several years to install systems that process recycled fiber and that allow
the use of baled pulp.
ENVIRONMENTAL MATTERS
The Corporation has been named as a potentially responsible party at a number
of waste disposal sites, none of which, individually or in the aggregate, in
management's opinion, is likely to have a material adverse effect on its
business or results of operations.
OUTLOOK
Earnings from operations are expected to improve over the balance of 1998 as
benefits of recently implemented price increases for tissue products in the
United States are realized and savings from the previously announced
restructuring plan build. As a result, management believes earnings per share
from operations for the last nine months of 1998 should be greater than the
same period a year ago.
<PAGE>
INFORMATION CONCERNING FORWARD-LOOKING STATEMENTS
Certain information in this report is forward-looking and is based on various
assumptions. Such information includes, without limitation, the business
outlook, anticipated financial position and operating results, strategies,
contingencies and contemplated transactions of the Corporation and the
Corporation's estimated effective income tax rate for 1998. These
forward-looking statements are based upon management's expectations and
beliefs concerning future events impacting the Corporation. There can be no
assurance that such events will occur or that their effects on the Corporation
will be as currently expected. For a description of certain factors that
could cause the Corporation'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 Corporation's Annual Report on Form 10-K for the year ended
December 31, 1997 entitled "Factors That May Affect Future Results."
<PAGE>
PART II - OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The 1998 Annual Meeting of Stockholders was convened at 11:00 a.m. on
Thursday, April 30, 1998, at the Corporation's World Headquarters, 351 Phelps
Drive, Irving, Texas. Represented at the meeting in person or by proxy were
514,860,702 shares of common stock or 92% of all shares of common stock
outstanding.
The following directors were elected to three-year terms expiring in 2001:
Pastora San Juan Cafferty, Claudio X. Gonzalez, Louis E. Levy and Linda
Johnson Rice. Of the shares represented at the meeting, at least 98.3% voted
for each nominee, and 1.6% withheld authority to vote.
The Corporation's other directors are John F. Bergstrom, Paul J. Collins,
Robert W. Decherd, William O. Fifield, Frank A. McPherson, Wayne R. Sanders,
Wolfgang R. Schmitt and Randall L. Tobias.
In addition to the election of directors, the stockholders approved the
selection of Deloitte & Touche LLP as the independent auditors for the
Corporation. Of the shares represented at the meeting, 99.6% voted for such
selection, .1% voted against and .3% abstained or did not vote.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits
(3)a Restated Certificate of Incorporation, dated June 12, 1997,
incorporated by reference to Exhibit No. (3)a of the Corporation's Quarterly
Report on Form 10-Q for the quarter ended June 30, 1997.
(3)b By-Laws, as amended November 22, 1996, incorporated by reference
to Exhibit No. 4.2 of the Corporation's Registration Statement on Form S-8
filed with the Securities and Exchange Commission on December 6, 1996 (File
No. 33-17367).
(4) Copies of instruments defining the rights of holders of long-term
debt will be furnished to the Securities and Exchange Commission upon request.
(12) The following computation is filed as an exhibit to Part I of
this Form 10-Q:
<TABLE>
<CAPTION>
KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(MILLIONS OF DOLLARS)
Three Months Ended March 31
-------------------------------
1998 1997
- --------------------------------------------------------------------------------
<S> <C> <C>
Consolidated Companies
- -----------------------
Income before income taxes $ 404.4 $ 518.3
Interest expense 48.2 43.3
Interest factor in rent expense 11.5 12.5
Amortization of capitalized interest 2.3 2.2
Equity Affiliates
- ------------------
Share of 50%-owned:
Income before income taxes 11.7 13.4
Interest expense 1.6 1.9
Interest factor in rent expense .2 .2
Amortization of capitalized interest - .2
---------- --------
Earnings $ 479.9 $ 592.0
========== ========
Consolidated Companies
- -----------------------
Interest expense $ 48.2 $ 43.3
Capitalized interest 1.5 4.5
Interest factor in rent expense 11.5 12.5
Equity Affiliates
- ------------------
Share of 50%-owned:
Interest expense and capitalized interest 1.6 1.9
Interest factor in rent expense .2 .2
---------- --------
Fixed charges $ 63.0 $ 62.4
========== ========
Ratio of earnings to fixed charges 7.62 9.49
========== ========
</TABLE>
(27) The Financial Data Schedule required by Item 601(b)(27) of Regulation
S-K has been included with the electronic filing of this Form 10-Q.
(b) Reports on Form 8-K
None.
<PAGE>
SIGNATURES
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 thereunto duly authorized.
KIMBERLY-CLARK CORPORATION
(Registrant)
By: /s/ John W. Donehower
------------------------
John W. Donehower
Senior Vice President and
Chief Financial Officer
(principal financial officer)
By: /s/ Randy J. Vest
--------------------
Randy J. Vest
Vice President and Controller
(principal accounting officer)
May 12, 1998
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> MAR-31-1998
<CASH> 99300
<SECURITIES> 0
<RECEIVABLES> 1563900
<ALLOWANCES> 0<F1>
<INVENTORY> 1295900
<CURRENT-ASSETS> 3412600
<PP&E> 9870900
<DEPRECIATION> 4249300
<TOTAL-ASSETS> 11289100
<CURRENT-LIABILITIES> 3515700
<BONDS> 1805700
0
0
<COMMON> 0
<OTHER-SE> 0<F1>
<TOTAL-LIABILITY-AND-EQUITY> 11289100
<SALES> 3048600
<TOTAL-REVENUES> 3048600
<CGS> 1884100
<TOTAL-COSTS> 2604300
<OTHER-EXPENSES> 0<F1>
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 48200
<INCOME-PRETAX> 404400
<INCOME-TAX> 129600
<INCOME-CONTINUING> 297600
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 297600
<EPS-PRIMARY> .53
<EPS-DILUTED> .53
<FN>
<F1>Items not disclosed since they are not required for interim reporting under
regulation S-X, Article 10.
</FN>
</TABLE>
