Kimberly-Clark 3Q Profit Rises 41 Percent

BETSY VERECKEY

NEW YORK (AP) — Price hikes on Huggies diapers and Kleenex tissues helped push Kimberly-Clark Corp. to a 41 percent profit increase, and the company said it will hold tight to the increases even as many retailers push discounts and store brands.

The maker of Huggies diapers and Kleenex tissues said Thursday its third-quarter profit jumped 41 percent because of higher prices on its products and lower commodity and energy costs. The company raised prices last year to compensate for high commodity costs.

Kimberly-Clark also raised its outlook because of cost-cutting, sales growth and favorable exchange rates, which lifted shares $3.61, or 6.1 percent, to $63.32 in midday trading.

On a conference call Thursday, Chief Executive Thomas J. Falk said that retailers, facing stagnant sales, are cutting prices to stimulate customer traffic. Wal-Mart, the world's biggest retailer, has plans to cut prices each week on thousands of items.

"You're seeing it not just with them," Falk said. "Safeway is running ads with the same kind of program. ... Our focus is more on trying to drive innovation and differentiation and not compete on price."