Kimberly-Clark faces risks from fluctuating foreign currency exchange rates, particularly in Argentina and Türkiye, impacting sales and profitability. Input cost inflation, especially in developing markets, poses a challenge. Supply chain disruptions, geopolitical instability (e.g., war in Ukraine), and potential impairment of assets in Russia are also significant risks. The 2024 Transformation Initiative's success is uncertain, with potential delays or failure to achieve anticipated cost savings.
Financial Upside
Kimberly-Clark anticipates significant cost savings from the 2024 Transformation Initiative, estimated at $1.5 billion pre-tax. The sale of the PPE business generated a pre-tax gain of $566 million. Improved operating profit and net income are expected, driven by productivity savings and favorable volume/mix/pricing in some markets. Acquisitions of Thinx and other subsidiaries could contribute to future growth.
