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$KMB plans to cut costs by $1.5Bil over the next four years, including slashing 5,000 to 5,500 jobs (about 12% of its workforce) and closing 10 facilities. This comes as the company reported a 22% YoY increase in profit for 4Q17, but only a slight uptick in sales. Excluding certain items, earnings were $1.57 per share, up 8% from a year ago.
$KMB posted a 3% YoY earnings growth to $567MM, or $1.60 per share, for 3Q17 as the personal-care company saw a modest sales growth of 1% to $4.6Bil. The company continues to expect FY17 net sales and organic sales to be flat or up slightly. EPS for FY17 is expected to be at the low end of its target range of $6.20 to $6.35.
$HAE elected Robert Abernathy to its BoD. Abernathy has led major medical businesses in North America and Europe with Halyard Health, Inc. Abernathy served as Chairman of the Board and CEO of Halyard Health Inc., a $KMB spinoff medical technology company specializing in important patient health care needs.
$KMB currently expects net sales and organic sales to be flat or slightly higher YoY in fiscal 2017, compared to the previous forecast of a 1-2% rise. Full-year EPS is expected to be in the low end of the $6.20-$6.35 target range. Spending is forecast to be in the lower half of the target range of $850-$950MM.
Sales of $KMB’s Personal Care segment in 2Q17 were almost unchanged from last year, while Consume Tissue sales dropped 2%. Sales of the K-C Professional segment edged up 0.5% compared to 2Q16. Sales in North America dropped 1%, while those in developing and emerging markets rose 3%. Sales in developed markets outside North America were down 7%.
Consumer products manufacturer $KMB reported a decline in 2Q17 profit, which was impacted by lower sales and higher input costs. Net income dropped 6% YoY to $531MM, and EPS declined to $1.49 from $1.56. Sales dipped 1% to $4.6Bil, hurt mainly by lower organic sales. There was a 5% decrease in operating profit.
$KMB said that on interest expense for FY17, the company expects it to come down slightly. The decline is expected as the company has a refinancing this year along with a bond that is coming due for $950MM in Aug. 2017. Additionally, regarding share repurchases, $KMB is expecting to do between $0.8-1Bil worth of share repurchases in FY17.
$KMB stated that regarding the Chinese pricing environment, the pricing in 1Q17 vs. 4Q16 was similar; the company didn't see any degradation. The price decline was a carry-over effect of what happened in 1H16. Currently the company believes the pricing has stabilized and the pricing comps would get more favorable in 2H17.
$KMB sees FY17 net sales increase 1-2%. Organic sales are touted to grow 1-2%, driven by higher volumes for the year. Input cost inflation is estimated at $150-250MM. Capital spending for 1Q17 was $215MM vs. $220MM a year ago. Total debt was $7.8Bil at March 31, 2017.
For $KMB in 1Q17, net sales for Personal Care segment inched 2% up to $2.25Bil. Consumer Tissue segment was down 3% to $1.46Bil. Sales in North America decreased 1% due to lower volumes. Sales in developing and emerging markets increased 9% including a 3 point benefit from favorable currency rates.