KIMBERLY CLARK CORP
For the period ended Sep 30, 2024. Filed Oct 22, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2024 · Filed Oct 22, 2024
KMB$108.43-1.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-06-30; filed 2024-07-23.
0000055785-24-000085
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-09-30; filed 2024-10-22.
0000055785-24-000094
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 71 previous paragraphs and 76 current paragraphs.
36 unchanged; 26 reworded; 14 added; 9 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 20 previous and 20 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (14)
Current report
•Overview of Third Quarter 2024 Results
Current report
•Sale of PPE business - In 2024, we recognized a gain related to the sale of our PPE business discussed above. See Item 1, Note 3 to the unaudited interim condensed consolidated financial statements for details.
Current report
Overview of Third Quarter 2024 Results
Current report
•Operating profit was $1.2 billion compared to $774 in the prior year. Net Income Attributable to Kimberly-Clark Corporation was $907 compared to $587 in the prior year, and diluted earnings per share were $2.69 compared to $1.73 in the prior year. Results in the current and prior year were impacted by the activities discussed in the non-GAAP section above.
Current report
N.M. - Not Meaningful
Current report
(e) Impact of the sale of the Brazil tissue and K-C Professional business, sale of the PPE business and other exited businesses and markets in conjunction with the 2024 Transformation Initiative.
Current report
Consolidated net sales for the three months ended September 30, 2024 of $5.0 billion decreased 4% primarily due to unfavorable currency translation and the impacts from divestitures and business exits. Organic sales increased 1% due to higher net selling prices in hyperinflationary economies, mainly Argentina.
Current report
In North America, net sales decreased 3% primarily due to the divestiture of our PPE business and lower organic sales driven by reduced volume. Outside North America, net sales decreased 4% in D&E markets as unfavorable currency impacts were partially offset by higher organic sales, while net sales decreased 4% in Developed Markets due to lower organic sales, unfavorable currency translation, and the impact of divestitures and business exits. Organic sales increased 8% in D&E markets due to higher net selling prices in hyperinflationary economies, while Developed Markets decreased 2% primarily due to temporary energy surcharge-related price increases in the prior year, partially offset by volume and mix gains.
Current report
The effective tax rate for the three and nine months ended September 30, 2024 was 20.5% and 20.2%, respectively, compared to 22.5% and 21.2% for the prior year. The adjusted effective tax rate for the three and nine months ended September 30, 2024 was 22.7% and 22.4%, respectively, compared to 22.5% and 22.6% for the prior year.
Current report
Net sales for the three months ended September 30, 2024 of $2.6 billion decreased 2% as unfavorable currency impacts of 6% were partially offset by a 3% increase in organic sales. The increase in organic sales was driven by changes in net selling prices and product mix gains of 3% and 1%, respectively. The increase in net selling prices was driven by hyperinflationary economies, mainly Argentina. Net sales for the nine months ended September 30, 2024 of $8.0 billion decreased 1% as unfavorable currency impacts were largely offset by growth in organic sales. Organic sales growth benefited from higher net selling prices in hyperinflationary economies coupled with increased volume within North America and D&E markets.
Current report
(e) Impact of the sale of the Brazil tissue and K-C Professional business and other exited businesses and markets in conjunction with the 2024 Transformation Initiative.
Current report
Operating profit for the three months ended September 30, 2024 of $265 decreased 1% compared to the prior year as productivity savings were offset by unfavorable pricing net of inflation and higher manufacturing costs. Operating profit for the nine months ended September 30, 2024 of $800 increased 13% compared to the prior year. Results benefited from productivity savings and more balanced pricing relative to input costs.
Current report
(e) Impact of the sale of the Brazil tissue and K-C Professional business, sale of the PPE business and other exited businesses and markets in conjunction with the 2024 Transformation Initiative.
Current report
Cash used for financing was $2.5 billion during the nine months ended September 30, 2024 compared to $1.6 billion in the prior year. This increase was primarily due to increased share repurchases coupled with debt repayments during the current year. During the nine months ended September 30, 2024, we repurchased 5.4 million shares of our common stock pursuant to our publicly announced share repurchase programs at a total cost of $752 through a broker in the open market.
Removed paragraphs (9)
Previous report
•Overview of Second Quarter 2024 Results
Previous report
Overview of Second Quarter 2024 Results
Previous report
•Operating profit was $655 in 2024 and $113 in 2023. Net Income Attributable to Kimberly-Clark Corporation was $544 in 2024 compared to $102 in 2023, and diluted earnings per share were $1.61 in 2024 compared to $0.30 in 2023. Results in 2024 include charges related to the 2024 Transformation Initiative, compared to 2023 results which include the net benefit related to the sale of the Brazil tissue and K-C Professional business, charges related to the impairment of intangible assets and pension settlement charges.
Previous report
Consolidated net sales for the three months ended June 30, 2024 of $5.0 billion decreased 2 percent compared to the year-ago period. Organic sales increased 4 percent as changes in net selling prices and volume increased sales by 2 percent and 1 percent, respectively, with the increase in net selling prices driven by hyperinflationary economies, mainly Argentina. Changes in foreign currency exchange rates decreased sales by 5 percent, while the divestiture of our Brazil tissue and K-C Professional business decreased sales by 1 percent.
Previous report
In North America, net sales increased 1 percent primarily from a 5 percent increase in Personal Care, partially offset by a decline of 4 percent and 2 percent in K-C Professional and Consumer Tissue, respectively. Outside North America, net sales decreased 7 percent in D&E markets and 4 percent in Developed Markets, primarily due to divestitures and business exits and unfavorable currency impacts. Organic sales increased 12 percent in D&E markets reflecting both pricing and volume gains, while Developed Markets decreased 3 percent due to temporary energy surcharge-related price increases in the prior period, partially offset by volume gains.
Previous report
The effective tax rate for the three and six months ended June 30, 2024 was 15.1 percent and 20.0 percent, respectively. The effective tax rate for the three months ended June 30, 2024 differed from the U.S. statutory federal tax rate of 21.0 percent primarily due to the discrete tax benefits associated with the 2024 Transformation Initiative charges. The effective tax rate for the three months ended June 30, 2023 differed from the U.S. statutory federal tax rate of 21.0 percent primarily due to the discrete tax benefit associated with charges for the impairment of intangible assets. The adjusted effective tax rate for the three and six months ended June 30, 2024 was 20.9 percent and 22.3 percent, respectively, compared to 20.5 percent and 22.6 percent for the same year-ago periods.
Previous report
Net sales for the three months ended June 30, 2024 of $2.7 billion were consistent with the prior year as organic growth of 8 percent was offset by foreign currency translation. The increase in organic sales was driven by changes in net selling prices, volume, and product mix of 4 percent, 3 percent and 1 percent, respectively. The increase in net selling prices was driven by hyperinflationary economies, mainly Argentina, while innovation, commercial execution and supply improvements contributed to volume growth, led by a 4 percent and 2 percent increase in our North America and D&E markets, respectively. Net sales for the six months ended June 30, 2024 were flat to the prior year, consistent with the impacts of organic growth and foreign currency translation discussed above.
Previous report
Operating profit for the three and six months ended June 30, 2024 of $245 and $535 increased 23 percent and 22 percent, respectively, compared to the same year-ago periods. Results benefited from productivity savings and more balanced pricing relative to input costs.
Previous report
We repurchase shares of Kimberly-Clark common stock from time to time pursuant to publicly announced share repurchase programs. During the six months ended June 30, 2024, we repurchased 1.2 million shares of our common stock at a total cost of $159 through a broker in the open market.
Reworded paragraphs (26)
Previous wording
This management's discussion and analysis ("MD&A") of financial condition and results of operations is intended to provide investors with an understanding of our recent performance, financial condition and prospects. Dollar amounts are reported in millions, except per share dollar amounts, unless otherwise noted. The following will be discussed and analyzed:
Current wording
This management's discussion and analysis ("MD&A") of financial condition and results of operations is intended to provide investors with an understanding of our recent performance, financial condition and prospects. Dollar amounts are reported in millions, except per share amounts, unless otherwise noted. The following will be discussed and analyzed:
Previous wording
The 2024 Transformation Initiative is intended to improve our focus on growth and reduce our structural cost base by reorganizing into three new business segments, making the corporate and regional overhead cost structures more efficient and optimizing our global supply chain. The transformation is expected to impact our organization in all major geographies, and workforce reductions are expected to be in the range of 4 percent to 5 percent. Certain actions under the transformation initiative are being finalized for implementation, and accounting for such actions will commence when the actions are authorized for execution. We expect to complete the transition to the new organizational structure by the end of 2024, and the transformation initiative is expected to be completed by the end of 2026. Total pre-tax savings are expected to be $3.0 billion in gross productivity; inclusive of input cost and manufacturing cost savings, and $200 in selling, general and administrative expenses. Total costs are anticipated to be approximately $1.5 billion pre-tax. Cash costs are expected to be approximately half of that amount, primarily related to workforce reductions. Expected non-cash charges are primarily related to incremental depreciation and asset write-offs, including losses associated with the expected exit of certain markets. Second quarter total transformation initiative charges were $190 pre-tax ($117 after tax). For the six months ended June 30, 2024, total transformation initiative charges were $235 pre-tax ($151 after tax).
Current wording
The 2024 Transformation Initiative is intended to improve our focus on growth and reduce our structural cost base by reorganizing into three new business segments, making the corporate and regional overhead cost structures more efficient and optimizing our global supply chain. The transformation is expected to impact our organization in all major geographies, and workforce reductions are expected to be in the range of 4% to 5%. Certain actions under the transformation initiative are being finalized for implementation, and accounting for such actions will commence when the actions are authorized for execution. We expect to complete the transition to the new organizational structure by the end of 2024, and the transformation initiative is expected to be completed by the end of 2026. Total pre-tax savings are expected to be $3.0 billion in gross productivity; inclusive of input cost and manufacturing cost savings, and $200 in selling, general and administrative expenses. Total costs are anticipated to be approximately $1.5 billion pre-tax. Cash costs are expected to be approximately half of that amount, primarily related to workforce reductions. Expected non-cash charges are primarily related to incremental depreciation and asset write-offs, including losses associated with the expected exit of certain markets. For the three months ended September 30, 2024, total transformation initiative charges were $124 pre-tax ($106 after-tax). For the nine months ended September 30, 2024, total transformation initiative charges were $359 pre-tax ($257 after-tax).
Previous wording
On July 1, 2024, we completed the pending sale transaction that was announced on April 7, 2024, of the personal protective equipment business included in our K-C Professional business segment for $640, subject to certain post-closing adjustments. The transaction includes Kimtech branded products, such as gloves, apparel and masks, and KleenGuard branded products, such as gloves, apparel, respirators and eyewear, which serve a variety of scientific and industrial industries globally. The assets included in the sale agreement have been reclassified to Other current assets as of June 30, 2024, and we will recognize a gain in Other (income) and expense, net in the third quarter of 2024.
Current wording
On July 1, 2024, we completed the sale transaction that was announced on April 7, 2024, of the personal protective equipment ("PPE") business included in our K-C Professional business segment for total consideration of $635, including the initial purchase price of $640 less working capital and other closing adjustments of $5. The transaction included Kimtech branded products, such as gloves, apparel and masks, and KleenGuard branded products, such as gloves, apparel, respirators and eyewear, which serve a variety of scientific and industrial industries globally. Upon closure of the transaction, a pre-tax gain of $566 ($453 after-tax) was recognized in Other (income) and expense, net. This gain is net of transaction costs of $14 that were determined to be directly attributable to the sale transaction.
Previous wording
In February 24, 2022, we completed our acquisition of a majority and controlling share of Thinx Inc. (“Thinx”), an industry leader in the reusable period and incontinence underwear category, for total consideration of $181. In the first quarter of 2023, we delivered a redemption notice to the third-party minority owner with respect to a portion of the remaining common securities of Thinx. The redemption closed in the second quarter of 2023, and we acquired additional ownership of Thinx for $48, increasing our ownership to 70 percent. As part of the completion of a negotiated final redemption, we acquired the remaining 30 percent ownership of Thinx for $47 in the fourth quarter of 2023. As the purchase of additional ownership in an already controlled subsidiary represents an equity transaction, no gain or loss was recognized in consolidated net income or comprehensive income.
Current wording
In February 24, 2022, we completed our acquisition of a majority and controlling share of Thinx Inc. (“Thinx”), an industry leader in the reusable period and incontinence underwear category, for total consideration of $181. In the first quarter of 2023, we delivered a redemption notice to the third-party minority owner with respect to a portion of the remaining common securities of Thinx. The redemption closed in the second quarter of 2023, and we acquired additional ownership of Thinx for $48, increasing our ownership to 70%. As part of the completion of a negotiated final redemption, we acquired the remaining 30% ownership of Thinx for $47 in the fourth quarter of 2023. As the purchase of additional ownership in an already controlled subsidiary represents an equity transaction, no gain or loss was recognized in consolidated net income or comprehensive income.
Previous wording
Consistent with the humanitarian nature of our products, we manufacture and sell only essential items in Russia, such as baby diapers and feminine pads, which are critical to the health and hygiene of women, girls and babies. Beginning in March 2022, we significantly adjusted our business in Russia, substantially curtailing media, advertising and promotional activity and suspending capital investments, other than certain maintenance investments, in our sole manufacturing facility in Russia. Our Russia business has represented approximately 1 to 2 percent of our net global sales, operating profit and total assets. Our ability to continue our operations in Russia may change as the situation evolves. We have experienced high input costs, supply chain complexities, reduced consumer demand, restricted access to raw materials and production assets, and restricted access to financial institutions, as well as supply chain, professional services, monetary, currency, trade and payment/investment sanctions and related controls. As the business, geopolitical and regulatory environment concerning Russia evolves, we may not be able to sustain the limited manufacture and sale of our products, and our assets may be partially or fully impaired.
Current wording
Consistent with the humanitarian nature of our products, we manufacture and sell only essential items in Russia, such as baby diapers and feminine pads, which are critical to the health and hygiene of women, girls and babies. Beginning in March 2022, we significantly adjusted our business in Russia, substantially curtailing media, advertising and promotional activity and suspending capital investments, other than certain maintenance investments, in our sole manufacturing facility in Russia. Our Russia business has represented approximately 1% to 2% of our net global sales, operating profit and total assets. Our ability to continue our operations in Russia may change as the situation evolves. We have experienced high input costs, supply chain complexities, reduced consumer demand, restricted access to raw materials and production assets, and restricted access to financial institutions, as well as supply chain, professional services, monetary, currency, trade and payment/investment sanctions and related controls. As the business, geopolitical and regulatory environment concerning Russia evolves, we may not be able to sustain the limited manufacture and sale of our products, and our assets may be partially or fully impaired.
Previous wording
This section presents a discussion and analysis of our second quarter 2024 net sales, operating profit and other information relevant to an understanding of the results of operations. In addition, we provide commentary regarding organic sales growth, which describes the impact of changes in volume, product mix and net selling prices excluding prior year's impact of divestitures on business exits on net sales. Changes in foreign currency exchange rates and divestitures and business exits also impact the year-over-year change in net sales. Revenue growth management is used to describe our capability that helps optimize our consumer value proposition and thereby maximize our brands' revenue potential with consumer-centric insights. It focuses on strategic pricing decisions, price pack architecture, managing our product mix, trade promotion activity and trading terms. Our analysis compares thethree and six months ended June 30, 2024 results to the same periods in 2023.
Current wording
This section presents a discussion and analysis of our net sales, operating profit and other information relevant to an understanding of the results of operations for thethree and nine months ended September 30, 2024. In addition, we provide commentary regarding organic sales growth, which describes the impact of changes in volume, product mix and net selling prices excluding prior year's impact of divestitures and business exits on net sales. Changes in foreign currency exchange rates and divestitures and business exits also impact the year-over-year change in net sales. Revenue growth management is used to describe our capability that helps optimize our consumer value proposition and thereby maximize our brands' revenue potential with consumer-centric insights. It focuses on strategic pricing decisions, price pack architecture, managing our product mix, trade promotion activity and trading terms. Our analysis compares thethree and nine months ended September 30, 2024 results to the same periods in 2023.
Previous wording
The non-GAAP financial measures exclude the following items for the relevant time periods as indicated in the reconciliations included later in this MD&A:
Current wording
These non-GAAP financial measures exclude the following items for the relevant time periods as indicated in the reconciliations included later in this MD&A:
Previous wording
•2024 Transformation Initiative - In 2024, we initiated this transformation initiative to improve our focus on growth and reduce our structural cost base by reorganizing into three new business segments, making the corporate and regional overhead cost structures more efficient and optimizing our global supply chain. Results in 2024 include charges related to this program. See Item 1, Note 2 to the unaudited interim consolidated financial statements for details.
Current wording
•2024 Transformation Initiative - In 2024, we initiated this transformation initiative to improve our focus on growth and reduce our structural cost base by reorganizing into three new business segments, making the corporate and regional overhead cost structures more efficient and optimizing our global supply chain. Results in 2024 include charges related to this program. See Item 1, Note 2 to the unaudited interim condensed consolidated financial statements for details.
Previous wording
•Impairment of intangible assets - In the second quarter of 2023, we recognized charges related to the impairment of certain intangible assets related to Softex Indonesia and Thinx. See Item 1, Note 4 to the unaudited interim consolidated financial statements for details.
Current wording
•Impairment of intangible assets - In the third quarter of 2024 and the second quarter of 2023, we recognized charges related to the impairment of certain intangible assets related to Softex and Thinx. See Item 1, Note 4 to the unaudited interim condensed consolidated financial statements for details.
Previous wording
•Sale of Brazil tissue and K-C Professional business - In the second quarter of 2023, we recognized a net benefit related to the sale of our Brazil tissue and K-C Professional business. See Item 1, Note 3 to the unaudited interim consolidated financial statements for details.
Current wording
•Sale of Brazil tissue and K-C Professional business - In the second quarter of 2023, we recognized a net benefit related to the sale of our Brazil tissue and K-C Professional business. See Item 1, Note 3 to the unaudited interim condensed consolidated financial statements for details.
Previous wording
•Net sales of $5.0 billion decreased 2 percent compared to the year-ago period, while organic sales grew 4 percent.
Current wording
•Net sales of $5.0 billion decreased 4% compared to the prior year, while organic sales grew 1%.
Previous wording
This section presents a discussion and analysis of our second quarter 2024 net sales, operating profit and other information relevant to an understanding of the results of operations.
Current wording
This section presents a discussion and analysis of our net sales, operating profit and other information relevant to an understanding of the results of operations for the three and nine months ended September 30, 2024.
Previous wording
Consolidated net sales for the six months ended June 30, 2024 of $10.2 billion decreased 1 percent compared to the year-ago period. Organic sales increased 5 percent, as changes in net selling prices, product mix, and volume increased sales by 3 percent, 1 percent, and 1 percent, respectively. The increase in net selling prices was driven by hyperinflationary economies, mainly Argentina. Changes in foreign currency exchange rates decreased sales by approximately 5 percent, while the divestiture of our Brazil tissue and K-C Professional business decreased sales by 1 percent. Changes in net and organic sales for North America, D&E Markets, and Developed Markets were relatively consistent with those discussed for the quarter-to-date period above.
Current wording
Consolidated net sales for the nine months ended September 30, 2024 of $15.1 billion decreased 2% compared to the prior year. Organic sales increased 4%, as changes in net selling prices, product mix, and volume increased sales by 2%, 1%, and 1%, respectively. The increase in net selling prices was driven by hyperinflationary economies, mainly Argentina. Changes in foreign currency exchange rates decreased sales by approximately 4%, while divestitures and business exits decreased sales by 1%. In North America, net sales were flat as higher organic sales were offset by the divestiture of our PPE business. Changes in net and organic sales for D&E Markets and Developed Markets were relatively consistent with those discussed for the quarter-to-date period above.
Previous wording
Operating profit for the three and six months ended June 30, 2024 was $655 and $1.5 billion, respectively, compared to $113 and $900 for the same year-ago periods. Results in 2024 include charges related to the 2024 Transformation Initiative, compared to 2023 results which include the net benefit related to the sale of the Brazil tissue and K-C Professional business and charges related to the impairment of intangible assets. Excluding these items, adjusted operating profit for the three and six months ended June 30, 2024 was $845 and $1.7 billion, respectively, representing a 16 percent and 15 percent increase compared to the same year-ago periods. Results benefited from improved gross profit as a result of higher organic sales, and gross supply chain productivity savings of approximately $135 and $255 for the three and six months ended June 30, 2024, respectively, partially offset by input cost inflation, primarily in D&E markets, supply chain related investments, unfavorable currency effects and higher marketing, research and general expenses.
Current wording
Operating profit for the three and nine months ended September 30, 2024 was $1.2 billion and $2.7 billion, respectively, compared to $774 and $1.7 billion for the prior year. Results in 2024 include charges related to the 2024 Transformation Initiative, the gain recognized for the sale of the PPE business, and charges related to the impairment of intangible assets, compared to 2023 results which include the net benefit related to the sale of the Brazil tissue and K-C Professional business and charges related to the impairment of intangible assets. Excluding these items, adjusted operating profit for the three and nine months ended September 30, 2024 was $810 and $2.6 billion, respectively, representing a 5% and 12% increase compared to the prior year. Results benefited from gross supply chain productivity savings of approximately $130 and $385, respectively, partially offset by supply chain related investments, input cost inflation, primarily in D&E markets, unfavorable currency effects and the impact of divestitures.
Previous wording
Interest expense for the three and six months ended June 30, 2024 was $72 and $139, respectively, compared to $76 and $149 for the same year-ago periods.
Current wording
Interest expense for the three and nine months ended September 30, 2024 was $67 and $206, respectively, compared to $74 and $223 for the prior year.
Previous wording
Our share of net income of equity companies for the three and six months ended June 30, 2024 was $63 and $124, respectively, compared to $50 and $93 for the same year-ago periods. The increases were driven by Kimberly-Clark de Mexico, S.A.B. de C.V. results which benefited from favorable foreign currency effects, volume and mix growth, and productivity savings, partially offset by higher general and administrative expenses.
Current wording
Our share of net income of equity companies for the three and nine months ended September 30, 2024 was $48 and $172, respectively, compared to $50 and $143 for the prior year. The changes for the nine months ended were driven by Kimberly-Clark de Mexico, S.A.B. de C.V. results which benefited from volume, mix and pricing growth, productivity savings, and favorable foreign currency effects, partially offset by higher general and administrative expenses.
Previous wording
Diluted earnings per share for the three and six months ended June 30, 2024 were $1.61 and $3.52, respectively, compared to $0.30 and $1.97 for the same year-ago periods. Adjusted diluted earnings per share for the three and six months ended June 30, 2024 were $1.96 and $3.97, respectively, representing a 19 percent and 20 percent increase compared to the same year-ago periods.
Current wording
Diluted earnings per share for the three and nine months ended September 30, 2024 were $2.69 and $6.21, respectively, compared to $1.73 and $3.70 for the prior year. Adjusted diluted earnings per share for the three and nine months ended September 30, 2024 were $1.83 and $5.80, respectively, representing a 5% and 15% increase compared to the prior year.
Previous wording
Operating profit for the three and six months ended June 30, 2024 of $540 and $1.1 billion increased 14 percent and 13 percent, respectively, compared to the same year-ago periods. Results benefited primarily from favorable volume and mix, pricing net of inflation and gross supply chain productivity savings, partially offset by unfavorable currency effects and higher marketing, research and general expenses.
Current wording
Operating profit for the three months ended September 30, 2024 of $482 decreased 4% compared to the prior year as pricing net of inflation and gross supply chain productivity savings were more than offset by unfavorable currency effects and higher advertising investments. Both pricing and the impacts of currency were primarily driven by hyperinflationary economies. Operating profit for the nine months ended September 30, 2024 of $1.6 billion increased 7% compared to the prior year. Results benefited primarily from favorable volume and mix, pricing net of inflation and gross supply chain productivity savings, partially offset by unfavorable currency effects and higher marketing, research and general expenses.
Previous wording
Net sales for the three months ended June 30, 2024 of $1.5 billion decreased 4 percent due to impacts from divestitures and business exits of 2 percent and a 2 percent decline in organic sales. Organic sales were negatively impacted by retailer inventory volume adjustments in North America and lower pricing in Developed Markets due to temporary energy surcharge-related price increases in the prior period. Net sales for the six months ended June 30, 2024 of $3.1 billion decreased 3 percent due to impacts from divestitures and business exits, coupled with a decline in organic sales from lower pricing in Developed Markets.
Current wording
Net sales for the three months ended September 30, 2024 of $1.5 billion decreased 2% primarily due to a 1% decline in organic sales. Organic sales were negatively impacted by retailer inventory volume adjustments in North America and lower pricing in Developed Markets due to temporary energy surcharge-related price increases in the prior year. Net sales for the nine months ended September 30, 2024 of $4.6 billion decreased 3% due to impacts from divestitures and business exits, coupled with a decline in organic sales from lower pricing in Developed Markets.
Previous wording
Net sales for the three months ended June 30, 2024 of $841 decreased 5 percent primarily due to divestitures and business exits and unfavorable currency impacts. Organic sales were flat to the prior period as favorable mix gains were offset by lower pricing in Developed Markets due to temporary energy surcharge-related price increases in the prior period and decreased volume in North America partially due to ongoing rightsizing of the portfolio to enhance focus on profitable growth. Net sales for the six months ended June 30, 2024 of $1.7 billion decreased 4 percent primarily due to divestitures and business exits and unfavorable currency impacts. This decline was partially offset by a 1 percent increase in organic sales driven by price realization and mix benefits.
Current wording
Net sales for the three months ended September 30, 2024 of $767 decreased 10% primarily due to divestitures and business exits and unfavorable currency impacts. Organic sales declined 1% primarily from the impacts of lower pricing in Developed Markets due to temporary energy surcharge-related price increases in the prior year and decreased volume in North America due to softer demand in retail and industrial channels. Net sales for the nine months ended September 30, 2024 of $2.4 billion decreased 6% primarily due to divestitures and business exits and unfavorable currency impacts. Organic sales were flat to the prior year as favorable mix gains were offset by lower volume in North America.
Previous wording
Operating profit for the three months ended June 30, 2024 of $186 decreased 1 percent compared to the prior year as productivity gains were offset by manufacturing cost headwinds, higher marketing, research and general expenses, and unfavorable pricing net of cost inflation. Operating profit for the six months ended June 30, 2024 of $374 increased 8 percent compared to the same year-ago period. Results primarily benefited from productivity savings and higher net selling prices, partially offset by lower volumes.
Current wording
Operating profit for the three months ended September 30, 2024 of $161 decreased 4% compared to the prior year primarily due to the divestiture of the PPE business and unfavorable pricing net of cost inflation, partially offset by productivity gains. Operating profit for the nine months ended September 30, 2024 of $535 increased 4% compared to the prior year. Results primarily benefited from productivity savings, partially offset by the divestiture of the PPE business.
Previous wording
Cash provided by operations was $1.5 billion during the six months ended June 30, 2024 compared to $1.4 billion in the prior year. The increase was driven by the increase in operating profit, excluding the effect of non-cash charges, partially offset by unfavorable changes in operating working capital.
Current wording
Cash provided by operations was $2.4 billion during the nine months ended September 30, 2024 compared to $2.3 billion in the prior year. The increase was driven by the higher operating profit, excluding the effect of non-cash charges, and favorable changes in operating working capital, partially offset by cash payments related to our 2024 Transformation Initiative.
Previous wording
During the six months ended June 30, 2024, our capital spending was $352 compared to $389 in the prior year. We anticipate that full year capital spending will be approximately $800, including incremental spending from the 2024 Transformation Initiative. Proceeds from asset and business dispositions of $218 in the first six months of 2023 primarily reflected the sale of our Brazil tissue and K-C Professional business.
Current wording
Cash provided by investing was $94 during the nine months ended September 30, 2024 compared to cash used in the prior year of $266, as capital spending was more than offset by proceeds from asset and business dispositions. During the nine months ended September 30, 2024, our capital spending was $512 compared to $549 in the prior year. We anticipate that full year capital spending will be approximately $800, including incremental spending from the 2024 Transformation Initiative. Proceeds from asset and business dispositions of $649 in the first nine months of 2024 primarily reflected the sale of our PPE business. Proceeds from asset and business dispositions of $219 in the first nine months of 2023 primarily reflected the sale of our Brazil tissue and K-C Professional business.
Previous wording
Our short-term debt, which consists of U.S. commercial paper with original maturities up to 90 days and/or other similar short-term debt issued by non-U.S. subsidiaries, was $9 as of June 30, 2024 (included in Debt payable within one year on the consolidated balance sheet). The average month-end balance of short-term debt for the second quarter of 2024 was $6. These short-term borrowings provide supplemental funding to support our operations. The level of short-term debt generally fluctuates depending upon the amount of operating cash flows and the timing of customer receipts and payments for items such as dividends and income taxes.
Current wording
Our short-term debt, which consists of U.S. commercial paper with original maturities up to 90 days and/or other similar short-term debt issued by non-U.S. subsidiaries, was $4 as of September 30, 2024 (included in Debt payable within one year on the condensed consolidated balance sheet). The average month-end balance of short-term debt for the nine months ended September 30, 2024 was $5. These short-term borrowings provide supplemental funding to support our operations. The level of short-term debt generally fluctuates depending upon the amount of operating cash flows and the timing of customer receipts and payments for items such as dividends and income taxes.
Previous wording
At June 30, 2024 and December 31, 2023, total debt was $8.0 billion.
Current wording
As of September 30, 2024 and December 31, 2023, total debt was $7.5 billion and $8.0 billion, respectively.
Previous wording
We have evaluated the effects of the Global anti-Base Erosion rules set forth by the Organization for Economic Co-Operation and Development, referred to as “Pillar 2,” which establishes a global minimum corporate tax rate of 15 percent. We have (1) determined that Pillar 2 legislation has been enacted in one or more of the jurisdictions in which the Company operates and the Company is within the scope of such legislation, (2) assessed such enacted legislation and, as applicable, the Transitional Safe Harbor provisions for Pillar 2 that apply, and (3) determined the impact will be immaterial to our financial results. We intend to file a Qualified Country-by-Country Report for the current year for each jurisdiction in which we intend to rely on the Transitional Country-by-Country Reporting Safe Harbor provisions.
Current wording
We have evaluated the effects of the Global anti-Base Erosion rules set forth by the Organization for Economic Co-Operation and Development, referred to as “Pillar 2,” which establishes a global minimum corporate tax rate of 15%. We have (1) determined that Pillar 2 legislation has been enacted in one or more of the jurisdictions in which the Company operates and the Company is within the scope of such legislation, (2) assessed such enacted legislation and, as applicable, the Transitional Safe Harbor provisions for Pillar 2 that apply, and (3) determined the impact will be immaterial to our financial results. We intend to file a Qualified Country-by-Country Report for the current year for each jurisdiction in which we intend to rely on the Transitional Country-by-Country Reporting Safe Harbor provisions.