Kimberly-Clark profit beats Street as costs decline
(Reuters) - Kimberly-Clark Corp (KMB.N) posted a greater-than-expected rise in quarterly profit on Friday as it cut costs, and the company said it expects the savings to help it overcome moderate increases in commodity prices.
The maker of Kleenex tissues also forecast full-year earnings that could beat Wall Street estimates.
Kimberly-Clark has been cutting costs and has benefited from a decline in commodity prices, which for years had been a pressure point for the tissue, toilet paper and diaper maker.
For the full year, the company expects to earn between $5.50 and $5.65 a share, before one-time items. Analysts on average were expecting $5.58, according to Thomson Reuters I/B/E/S.
In October, Kimberly-Clark said it would stop selling its Huggies diapers in much of Western and Central Europe as part of a plan to leave low-profit businesses in that region.
Fourth-quarter earnings per share, excluding restructuring costs, rose to $1.37 from $1.28 a year earlier, topping analysts' average forecast of $1.35.
Net profit declined to $267 million, or 68 cents per share, from $401 million, or $1.01 per share, a year earlier.
The company, which has been spending more on marketing to compete against larger rivals such as Pampers diaper maker Procter & Gamble Co (PG.N), said fourth-quarter net sales rose 3 percent to $5.3 billion.
Shares of the company rose to $87.80 in premarket trading Friday, up from a Thursday close at $86.58 on the New York Stock Exchange.