Kimberly-Clark, a leading global consumer goods company, reported a 2 per cent year-on-year (YoY) increase in sales to $5.2 billion in the first quarter (Q1) of fiscal 2023 (FY23), driven by strong organic sales growth. Organic sales increased by 5 per cent YoY, with North American sales up 5 per cent YoY, and sales outside of North America up 4 per cent YoY in developing and emerging markets and 10 per cent YoY in developed markets.

The company's gross margin improved by 340 basis points to 33.2 per cent YoY in Q1 FY23, thanks to higher net revenue realisation and cost savings offsetting higher input costs of $160 million. Operating profit for the quarter was $787 million, up from $693 million in the same period last year, resulting in an operating margin of 15.1 per cent, an increase of 150 basis points. On an adjusted basis, operating profit increased by 25 per cent YoY. The net income of equity companies was $43 million, up from $23 million last year, driven by Kimberly-Clark de Mexico, the company said in a press release.

Kimberly-Clark’s earnings per share (EPS) increased by 8 per cent YoY to $1.67 per diluted share on a reported basis and 24 per cent YoY on an adjusted basis, driven by the 25 per cent increase in operating profit versus adjusted results last year.

The company's personal care segment reported sales of $2.7 billion in Q1 FY23, down 1 per cent YoY, but organic sales increased by 3 per cent YoY. The consumer tissue segment reported sales of $1.6 billion, up 4 per cent YoY, including organic growth of 7 per cent YoY. The K-C Professional (KCP) segment reported sales of $847 million, up 9 per cent, including organic growth of 11 per cent YoY, driven by price and mix partially offset by volume.

In FY23, Kimberly-Clark expects its organic sales to remain unchanged, with a range of 2-4 per cent. Net sales are expected to grow by 0-2 per cent, and the company is forecasting an increase in operating profit, up low double digits compared to the previous projection of up mid to high single digits, the release added.

"I'm proud of our teams around the world for a strong start to the year. We grew organic sales by 5 per cent, which reflects the health of our categories and the essential nature of our products," said chairman and CEO Mike Hsu. "Our growth strategy continues to deliver behind strong execution of our commercial programmes. Revenue growth management initiatives drove continued sales momentum with a better-than-expected elasticity impact on volume. Looking ahead, we have an exciting innovation pipeline that will deliver superior performance in health, wellness, and sustainability. With our strong portfolio of trusted brands, we have our sights set on growing our categories and winning with consumers to enable long-term, profitable growth."