Oct 24, 2005. /Lesprom Network/. Kimberly-Clark Corporation reported on Monday that sales in the third quarter of 2005 were $4.0 billion, an increase of 5.8% percent over the prior year and a new quarterly record. The improvement was driven by volume growth of about 4% along with currency benefits of nearly 2%. Diluted net income of $0.68 per share decreased 22% compared with income from continuing operations of $0.87 per share in 2004. However, excluding charges related to competitive improvement initiatives for streamlining the company's operations, earnings before unusual items in the third quarter of 2005 rose 9% to $0.95 per share. This was in line with the company's previous guidance ($0.94 to $0.96 per share) despite higher-than-expected energy costs and direct expenses from hurricane Katrina that totaled approximately $15 million before tax, or $0.02 per share.

In the third quarter of 2004, reported net income of $0.89 per share included $0.02 per share from discontinued operations, representing the results of the company's former fine paper and technical paper businesses that were part of the Neenah Paper spin-off to shareholders on November 30, 2004.

Chairman and chief executive officer Thomas J. Falk attributed the improvement in third quarter results to continued solid execution of the company's global business plan. He said, "K-C teams are focused on building and extending our brands, reducing costs and improving returns on invested capital. In combination, these strategies are enabling us to generate profitable top-line growth, deliver bottom-line results in line with our objectives and return significant amounts of cash to our shareholders. I am proud of what our teams have accomplished this quarter, particularly in light of the inflationary pressures that have impacted our businesses."

The company noted that sales for the quarter were about 7% above the prior year excluding sales in 2004 from the pulp operations that were also divested in the Neenah Paper spin-off.  Highlights of the 4% increase in sales volumes included continued strength in developing and emerging markets along with double-digit growth for key personal care and consumer tissue brands in North America and for diapers in Europe. In addition to currency effects of 2%, higher net selling prices boosted sales by approximately 1%.

The top-line growth, continued successful cost and tax savings initiatives and the company's ongoing share repurchase program were key factors contributing to the 9% improvement in third quarter earnings per share before unusual items.  In achieving these results, the company absorbed inflation in key cost components totaling approximately $90 million and funded more than $25 million of additional marketing and research spending for new and improved products.

In millions dollar, except per share amounts

Kimberly-Clark and its well-known global brands are an indispensable part of life for people in more than 150 countries. Every day, 1.3 billion people - almost a quarter of the world's population - trust K-C brands and the solutions they provide to enhance their health, hygiene and well being. With brands such as Kleenex, Scott, Huggies, Pull-Ups, Kotex and Depend, Kimberly-Clark holds the №1 or №2 share position in more than 80 countries.