Huggies Maker Kimberly-Clark's Q1 Earnings Top Estimates; Boosts 2023 EPS Growth Outlook

Kimberly-Clark Corp KMB reported first-quarter FY23 sales growth of 2% year-on-year to $5.20 billion, beating the consensus of $5.06 billion.
Organic sales increased by 5% driven by a 10% increase in price and favorable product mix from ongoing revenue growth management programs offset by a 5% decrease in volume.
In North America, organic sales rose 5% in consumer Tissue, 12% in K-C Professional and 2% in Personal Care.
EPS of $1.67 beat the analyst consensus of $1.32.
Gross profit grew by 14% Y/Y to $1.72 billion. Marketing, research, and general expenses increased 4% Y/Y to $924 million.
Operating income increased 13.6% to $787 million, with an operating margin of 15.1%.
Cash provided by operations in the quarter was $613 million. The company held $524 million in cash and equivalents as of March 31, 2023.
"We will continue to lean into our productivity and cost savings programs to mitigate elevated costs, while strategically investing in future growth platforms that will expand our presence in attractive markets for years to come," said Chairman and CEO Mike Hsu.
Outlook: Kimberly-Clark continues to expect FY23 sales to increase 0% - 2%. The company raised FY23 EPS growth outlook from 2% - 6% to 6% - 10% increase versus FY22 adj EPS.
It also raised FY23 operating profit growth outlook to up low double digits (prior view: up mid to high single digits).
It continues to see share repurchases of $100 million - $150 million, subject to market conditions.
Price Action: KMB shares are trading higher by 2.23% at $145.61 on the last check Tuesday.

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