Kimberly-Clark Corporation (NYSE:KMB) Q4 2017 Earnings Conference Call Transcript
Jan 23, 2018 • 10:00 am ET
Ladies and gentlemen, thank you for your patience and holding. We now have your speakers in conference. Please be aware that each of your lines is in a listen-only mode. At the conclusion of this morning's presentation, we will open the floor for questions. At that time, instructions will be given as to the procedures to follow-up, if you would like to ask an audio question. It is now my pleasure to introduce today's first presenter Mr. Paul Alexander.
Thank you, and good morning, everyone. Welcome to Kimberly-Clark's year-end earnings conference call. On the call this morning are Tom Falk, Chairman and CEO; Mike Hsu, President and Chief Operating Officer; and Maria Henry, our CFO. Here's the agenda for the call. Maria will begin with a review of full year 2017 results. After that Tom will discuss our announcements this morning of a new global restructuring program and also our multi-year ongoing cost savings target. Mike will then comment on our 2018 outlook and we'll finish with Q&A. As usual, we have a presentation of today's materials in the Investors section of our website. That presentation includes an appendix with a summary of business segment results for 2017 and our key planning assumptions for 2018.
As a reminder, we will be making forward-looking statements today. Please see the Risk Factors section of our latest Annual Report on Form 10-K for further discussion of forward-looking statements. We will also be referring to adjusted results and outlook, both exclude certain items described in this morning's news release. The release has further information about these adjustments and reconciliations to comparable GAAP financial measures.
And now, I'll turn it over to Maria.
Thanks, Paul. Good morning, everyone. Thanks for joining our call today. Let me start with the headlines of our full year results. Sales and earnings were broadly consistent with our previous outlook. We achieved record FORCE cost savings and reduced discretionary spending to help offset commodity inflation and fund competitive investment, and we improved capital efficiency and returned significant cash to shareholders.
Now let's cover the details of our results, starting with our sales. Full year net sales were $18.3 billion. Total sales and organic sales were both pretty similar year-on-year. On organic sales, volumes increased 1% and product mix improved slightly. Net selling prices were down more than 1%, reflecting the competitive environment and in some cases, improving currency rate. Looking at the topline by geography, in developing and emerging markets, organic sales rose 3% with volume growth of 5%. In terms of key growth market, personal care volumes increased mid-single digits in Latin America and in China, and nearly 20% in Eastern Europe. In developed markets outside of North America, organic sales declined 3%. The diaper category decline in South Korea was the big driver of that decrease. In North America, organic sales for consumer products fell 2%. Our results benefited from innovations, but were impacted by competitive activity and the lower US birthrate.
In K-C Professional in North America, organic