Kimberly-Clark Cleans Up

Paper products company Kimberly-Clark ( KMB) reported Thursday that first-quarter earnings rose 17% from last year, matching both its own and Wall Street's estimates. Total sales increased 10%, helped by the weak dollar.

The company also forecast second-quarter and full-year profit that matches or exceeds analysts' projections.

The company earned $459.3 million, or 91 cents a share, in the quarter ended March 31, compared with $397.7 million, or 78 cents a share, a year ago. In the prior-year period, the company earned $408.8 million, or 80 cents a share, before an unusual item.

Sales rose to $3.8 billion, from $3.46 billion last year. The company said overall sales volume was up 6% and Kimberly-Clark noted it had record shipments of its Pull-Ups training pants. Other areas of volume strength included the company's health-care products, consumer tissue in North America and Europe and the company's operations in Eastern Europe and the Middle East.

Foreign currency contributed positively to sales because changes in exchange rates increased the U.S. dollar value of first-quarter sales by more than 5% compared with 2003, the company said.

Looking forward, the company expects to hit its target for 3% to 5% volume growth and $150 million of cost reductions in 2004. Earnings are seen toward the high end of the company's target of $3.55 to $3.65 a share. Analysts expect $3.64 a share.

In the second quarter, Kimberly-Clark expects to overcome recent increases in fiber, polymer and oil costs and have earnings of 87 to 89 cents a share. That would be an increase of 6% to 9% compared with earnings of 82 cents a share in the prior-year quarter. Analysts are calling for 88 cents a share.

Shares of the Dallas-based company closed at $64.76 Wednesday on the New York Stock Exchange. During the day shares rose 0.41 cents, or 0.63%, to $65.17.

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