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Kimberly-Clark's warning
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March 12, 1998: 6:58 p.m. ET
Earnings of 54-58 cents a share will trail estimates; European units cited
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NEW YORK (CNNfn) - As a result of weaker European operations, Kimberly-Clark Corp. anticipates earnings from operations for the first quarter of 1998 will fall below expectations to a range of 54 cents to 58 cents a share.
Analysts had expected the Dallas-based paper products giant to earn about 62 cents a share in the first quarter. In the year-ago period, the company earned 65 cents a share.
"Our businesses in North America and Latin America continue to be solid, and while the environment in the Asia/Pacific region is difficult, the impact on our overall results has been small. However, earnings in Europe are substantially lower than expected," said Wayne R. Sanders, Kimberly-Clark chairman and chief executive.
The company said its cost-cutting initiatives in the region's highly competitive tissue markets haven't yet achieved their desired results. At the same time, the company has been spending heavily to start up new diaper capacity and to launch improved diapers and feminine care products in Europe.
The company said it expects earnings from operations to improve over the balance of the year.
As a result, earnings per share from operations during the last nine months of 1998 should be greater than the same period a year ago.
For the nine months ended Sept. 30, 1997, Kimberly-Clark reported net income of $1.05 billion, or $1.88 a share, on sales of $9.45 billion.
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Kimberly-Clark
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