Kimberly-Clark CEO To Step Down Next Year, Results Beat Estimates
Paper products giant Kimberly-Clark Corp. reported better-than-expected quarterly results on Monday, saying that long-time chief executive officer Thomas Falk would step down and be succeeded by chief operating officer Michael Hsu next year.
The Huggies diaper-/nappy-maker also said that it would keep its organic sales growth and earnings forecast for the year intact, sending its shares up 3% in early trading.
Falk, 60, will step down as CEO on 1 January 2019 and become the executive chairman, according to the company.
Focus On Core Brands
Falk, who has been CEO since 12 September 2002, steered the spin-off of the company's US-based health-care business in 2014, to focus on its core brands, such as Huggies and Kleenex tissues.
During his tenure, the company's annual sales have risen by 38%, while the stock has nearly doubled.
Like other US packaged-goods makers, Kimberly-Clark has also been plagued by surging commodities and transportation costs in recent times.
Changing Consumer Habits
The industry is also being rocked by changing consumer habits and pricing pressure due to the rise of online sales. Kimberly-Clark's stock is down about 9% this year.
Hsu, 54, who has been chief operating officer since 2017, oversaw the company's $8 billion (€7 billion) North American personal-care and consumer tissue business – its biggest unit.
Before joining Kimberly-Clark, Hsu also worked at Kraft Foods and H.J. Heinz, according to the company.
Excluding items, Kimberly-Clark earned $1.71 per share in the third quarter ended September, beating the average analyst estimate of $1.63, according to Refinitiv data.
Overall revenue slipped by 1.7%, to $4.58 billion (€4 billion), due to a strong dollar, but higher pricing pushed up organic revenue by 1%.