Kimberly-Clark Corp. (NYSE:KMB)

The analysis of the financial ratios over the five-year period reveals several notable trends in operational efficiency, liquidity, leverage, profitability, and returns.

Total Asset Turnover

Both reported and adjusted total asset turnover ratios exhibit a generally declining trend from 2016 to 2020. Reported total asset turnover decreased from 1.25 in 2016 to 1.09 in 2020, while the adjusted ratio followed a similar pattern, dropping from 1.20 to 1.10. This decline suggests a reduction in the efficiency with which the company utilizes its assets to generate sales over time.

Current Ratio

The current ratio, indicating short-term liquidity, shows a decreasing trend initially but a slight recovery by the end of the period. Reported current ratio fell from 0.87 in 2016 to a low of 0.73 in 2019 before slightly recovering to 0.80 in 2020. Adjusted current ratios mirror this trend, declining from 0.91 to 0.77 and then rising to 0.84. The overall levels below 1 indicate a consistently tight liquidity position throughout the period, with minor improvement in the final year.

Debt to Equity Ratio

The reported debt to equity ratio data is incomplete, but adjusted figures show significant fluctuations. It decreased from 11.82 in 2016 to 5.96 in 2017, then rose again to 11.47 in 2018 before gradually declining to 5.47 by 2020. This volatility indicates changing capital structure with varying reliance on debt financing, ending with a lower relative debt burden in 2020 compared to 2016.

Debt to Capital Ratio

Both reported and adjusted debt to capital ratios generally decreased during the period. Reported ratios fell from 1.01 in 2016 to 0.93 in 2020, and the adjusted ratios decreased steadily from 0.92 to 0.85. This trend signifies a modest reduction in leverage, implying cautious management of the company’s capital structure.

Financial Leverage

Reported financial leverage data is intermittent but demonstrates a rise from 24.09 in 2017 to 27.99 in 2020. Conversely, the adjusted financial leverage ratio declined significantly, from 22.03 in 2016 to 10.70 in 2020, with intermediate fluctuations. Adjusted figures suggest a considerable reduction in total leverage, while reported figures indicate an increasing trend, highlighting possible differences in calculation methods or adjustments.

Net Profit Margin

The reported net profit margin experienced variability, with a peak of 12.48% in 2017, a notable dip to 7.63% in 2018, followed by recovery to 12.29% by 2020. Adjusted net profit margin shows a more pronounced peak at 15.75% in 2017 and a rebound to 13.25% in 2020 after a deep trough in 2018. These patterns demonstrate fluctuations in profitability, with a significant downturn in 2018 and strong recovery thereafter.

Return on Equity (ROE)

Reported ROE figures are sparse but indicate exceptionally high values in 2017 and 2020 (over 360%), suggesting either extraordinary earnings or effects of leverage. Adjusted ROE values decline steadily from 287.17% in 2016 to 155.64% in 2020, though still markedly elevated relative to typical industry standards. This decreasing trend may reflect normalization of earnings or reduced leverage impact.

Return on Assets (ROA)

Reported ROA shows a decline from 14.83% in 2016 to 9.71% in 2018, followed by a recovery to 13.42% in 2020. Adjusted ROA trends upward overall, from 13.03% to 14.55%, despite a dip in 2018. This indicates improved asset utilization and profitability excluding extraordinary factors, especially in the later years of the period.

In summary, the company experienced decreased asset turnover and tight liquidity, while gradually reducing leverage and capital risk. Profitability and returns exhibited volatility, with a marked decline in 2018 but subsequent improvement, although returns on equity remained exceptionally high likely influenced by leverage effects. The adjusted metrics present a more stable and generally improving profitability and return profile, suggesting effective adjustments may have normalized some of the reported variability.

The financial data over the five-year period reveals several notable trends in sales, asset values, and asset turnover ratios.

Net Sales

Net sales exhibited a generally stable pattern from 2016 to 2019, remaining within a narrow range between approximately 18,200 million and 18,486 million US dollars. In 2020, there was an increase to 19,140 million US dollars, indicating a moderate growth in revenue during that year.

Total Assets

Total assets showed some fluctuations over the years. From 2016 to 2017, there was an increase from 14,602 to 15,151 million US dollars, followed by a decline in 2018 to 14,518 million US dollars. A recovery took place in 2019, raising total assets to 15,283 million US dollars, with a significant jump in 2020 to 17,523 million US dollars. This upward movement in the final year suggests increased investment or acquisitions.

Reported Total Asset Turnover

The reported total asset turnover ratio, which measures efficiency in using assets to generate sales, decreased overall during the period. It started at 1.25 in 2016 and fell slightly to 1.21 in 2017. A peak at 1.27 occurred in 2018, followed by a decline to 1.21 in 2019 and a more pronounced drop to 1.09 in 2020. The decline in 2020 may indicate reduced asset efficiency despite higher sales.

Adjusted Total Assets

Adjusted total assets followed a similar trend as total assets, rising from 15,115 million US dollars in 2016 to 15,698 million US dollars in 2017, then decreasing to 15,016 million in 2018 and slightly increasing to 15,228 million in 2019. A more notable increase occurred in 2020, reaching 17,440 million US dollars, reaffirming the expansion observed in total assets.

Adjusted Total Asset Turnover

This metric also exhibited a decreasing trend over the period, starting at 1.20 in 2016, dropping to 1.16 in 2017, increasing marginally to 1.23 in 2018 and staying roughly stable at 1.21 in 2019 before declining to 1.10 in 2020. This pattern mirrors the reported asset turnover trend, supporting a conclusion of reduced efficiency in asset utilization in the most recent year.

In summary, while sales have shown slight growth, particularly in 2020, the company’s asset base has expanded more considerably during the period. However, asset turnover ratios have generally declined, especially in 2020, which suggests that the growth in asset investments has outpaced sales growth, resulting in lower asset efficiency. This could be indicative of recent strategic investments or acquisitions that have yet to fully translate into proportional revenue increases.

The analysis of the financial data reveals a consistent pattern in the company's liquidity position over the five-year period. Both current assets and current liabilities exhibit fluctuations, yet the liabilities generally remain higher than the assets, resulting in a current ratio below the ideal benchmark of 1.

Current Assets

Current assets slightly increased from 5,115 million US dollars in 2016 to 5,211 million in 2017, then declined to 5,041 million in 2018 before stabilizing around the 5,000 million mark through 2019 and 2020.

Current Liabilities

Current liabilities showed a steady increase from 5,846 million US dollars in 2016 to a peak of 6,919 million in 2019, before decreasing to 6,443 million in 2020. The upward trend in liabilities outpaced the growth in assets during much of this period.

Reported Current Ratio

The reported current ratio declined from 0.87 in 2016 to 0.73 in 2019, indicating decreasing short-term liquidity and potential pressure on the company’s ability to cover current liabilities with current assets. In 2020, there was a slight recovery to 0.80, suggesting some improvement but still reflecting a liquidity position below 1.

Adjusted Current Assets and Liabilities

Adjusted current assets were consistently higher than reported current assets, beginning at 5,328 million in 2016 and remaining relatively stable through 2020 at 5,353 million. Adjusted current liabilities followed a similar trend to reported liabilities, rising until 2019 and then decreasing in 2020. The adjustments likely account for reclassifications or more conservative valuations.

Adjusted Current Ratio

The adjusted current ratio, starting at 0.91 in 2016, mirrored the trend of the reported ratio but consistently displayed slightly higher values. It dropped to a low of 0.77 in 2019 but improved to 0.84 in 2020, indicating that when adjustments are considered, the liquidity position appears marginally stronger but still below optimal levels.

Overall, the data indicates that the company experienced some erosion in short-term liquidity from 2016 through 2019, with a modest recovery in 2020. Current liabilities grew faster than assets for most of the period, pressuring the current ratios. Despite adjustments made to assets and liabilities, the company remained with a liquidity ratio under 1, which could signal potential challenges in meeting short-term obligations if the trend persists.

The financial data reveals several noteworthy trends in the company's capital structure over the five-year period from 2016 to 2020.

Total Debt

Total debt exhibited a generally upward trend, starting at $7,572 million in 2016 and increasing to $8,364 million in 2020. There was a slight decrease in 2017 to $7,425 million, followed by a modest rise in 2018 and a more pronounced increase in 2019 and 2020. This indicates the company has gradually increased its borrowings over these years.

Stockholders' Equity (Reported)

The reported stockholders’ equity showed significant volatility. It had a negative balance in 2016 (-$102 million) and 2018 (-$287 million), while 2017 and 2019 recorded relatively small negative figures (-$33 million), ending with a notable positive balance of $626 million in 2020. The fluctuations suggest instability or accounting adjustments affecting equity over the period.

Reported Debt to Equity Ratio

This ratio was available only for 2017 and 2020, recorded at 11.8 and 13.36 respectively. The high values imply a substantial amount of debt relative to reported equity, with a further increase by 2020, reflecting potentially increased financial leverage or weaker equity base when measured by reported figures.

Adjusted Total Debt

Adjusted total debt follows a similar but somewhat higher trajectory than reported total debt, beginning at $8,106 million in 2016 and growing steadily to $8,920 million in 2020. This adjustment likely includes off-balance-sheet items or additional liabilities, signifying a comprehensive view of indebtedness increasing over time.

Adjusted Total Stockholders’ Equity

The adjusted equity values show substantial fluctuations but an overall increasing trend, starting from $686 million in 2016, peaking at $1,337 million in 2017, dropping to $693 million in 2018, then improving to $811 million in 2019 and surging to $1,630 million in 2020. This variability suggests periodic reevaluations or changes in asset valuations with a significant recovery or improvement towards the end of the period.

Adjusted Debt to Equity Ratio

The adjusted debt to equity ratio decreased overall from 11.82 in 2016 to 5.47 in 2020, despite intermediate fluctuations (notably 11.47 in 2018 and 10.05 in 2019). The decline indicates improving relative equity strength or reduced leverage when considering adjusted figures, suggesting better capital structure management or higher equity base adjustment.

In summary, the company’s reported data suggests high leverage with unstable equity, whereas adjusted figures indicate improvement in the capital structure over the period, mainly due to increasing equity and controlled growth in debt. The trends imply efforts towards strengthening financial stability, despite the evident volatility and fluctuations in reported equity.

The financial data reflects the company's leverage and capital structure trends over the five-year period ending in 2020.

Total Debt

The total debt showed a relatively stable trend from 2016 through 2018, with values fluctuating slightly around 7,400 to 7,500 million US dollars. However, from 2018 onwards, there is a noticeable upward trend, culminating in an increase to 8,364 million US dollars by 2020. This indicates a gradual increase in the company's borrowing.

Total Capital

Total capital exhibits more variability compared to total debt. After increasing from 7,470 million US dollars in 2016 to 8,054 million in 2017, it declined sharply in 2018 to 7,168 million US dollars before ascending again, reaching 8,990 million by 2020. The pattern suggests fluctuations in equity or other capital components that impact the overall capital base.

Reported Debt to Capital Ratio

The reported debt to capital ratio, which measures the proportion of debt in the capital structure, fluctuated around the value of 1.0 or slightly below throughout the period. It decreased from 1.01 in 2016 to 0.92 in 2017, then rose above 1.0 in 2018, indicating total debt slightly exceeded total capital. The ratio then settled back near 1.0 in 2019 and decreased further to 0.93 in 2020, reflecting a modest improvement in the balance between debt and capital.

Adjusted Total Debt and Adjusted Total Capital

The adjusted figures provide a broader perspective on debt and capital. Adjusted total debt rose from 8,106 million in 2016 to 8,920 million in 2020, mirroring the upward trend seen in reported total debt but at higher absolute levels. Adjusted total capital increased steadily from 8,792 million to 10,550 million over the same period, indicating growth in the overall capital base beyond the reported figures.

Adjusted Debt to Capital Ratio

The adjusted debt to capital ratio consistently decreased from 0.92 in 2016 to 0.85 in 2020, suggesting an improving leverage position when considering the adjusted measures. This implies that the growth in adjusted capital outpaced the increase in adjusted debt, indicating strengthening financial structure under these comprehensive adjustments.

The financial data exhibits several notable trends over the five-year period.

Total Assets

Total assets show a generally increasing trend from 14,602 million US dollars at the end of 2016 to 17,523 million US dollars by the end of 2020. There is a slight decrease in 2018, followed by steady growth in subsequent years, indicating an expansion in the company's asset base.

Total Stockholders’ Equity (Reported)

The reported total stockholders’ equity figures display significant volatility, with negative values recorded in 2016, 2018, and 2019 (-102, -287, and -33 million US dollars respectively), and notably positive values in 2017 and 2020 (629 and 626 million US dollars respectively). This fluctuation suggests considerable changes in the company's equity position or accounting adjustments during this period.

Reported Financial Leverage

Available data for reported financial leverage is limited, with recorded ratios of 24.09 in 2017 and 27.99 in 2020. The increasing ratio between these years implies an increase in the company's use of debt relative to equity in the reported figures.

Adjusted Total Assets

Adjusted total assets parallel the trend observed in total assets, rising from 15,115 million US dollars at the end of 2016 to 17,440 million US dollars in 2020. Minor fluctuations occur but the overall trajectory is upward, reflecting growth in the asset base when adjusted for certain factors.

Adjusted Total Stockholders’ Equity

Adjusted equity reveals a positive and generally increasing pattern over the review period, starting at 686 million US dollars in 2016 and peaking at 1,630 million US dollars by 2020. There is a decline in 2018 but recovery and growth occur subsequently, suggesting improvement in the company's adjusted net worth.

Adjusted Financial Leverage

The adjusted financial leverage ratio demonstrates a decreasing trend from 22.03 in 2016 to 10.70 in 2020, with some oscillation in intermediate years. This downward movement indicates a reduction in leverage, reflecting potentially lower debt levels or strengthened equity on an adjusted basis.

In summary, the company shows growth in total and adjusted assets over time. While the reported equity fluctuates substantially with occasional negative values, the adjusted equity paints a more stable and improving picture. Adjusted financial leverage shows a declining trend, implying de-leveraging efforts or stronger equity buffers despite an increase in reported leverage ratios at select points. These observations highlight differences between reported and adjusted figures, which may be linked to accounting changes, reclassifications, or adjustments made for analytical clarity.

The financial data exhibits fluctuating patterns in profitability and sales performance over the five-year period.

Net Income Attributable to the Corporation

The net income shows variability, increasing from 2,166 million USD in 2016 to 2,278 million USD in 2017, followed by a significant decrease to 1,410 million USD in 2018. The figure then recovers to 2,157 million USD in 2019 and further rises to 2,352 million USD in 2020, indicating a rebound to levels surpassing the earlier peak in 2017.

Net Sales

Net sales remain relatively stable with slight growth over the period. Starting at 18,202 million USD in 2016, the sales incrementally increased to 18,259 million USD in 2017 and 18,486 million USD in 2018, before a slight decline to 18,450 million USD in 2019. In 2020, net sales increased noticeably to 19,140 million USD, representing the highest sales figure across the observed years.

Reported Net Profit Margin

The reported net profit margin follows a trend similar to net income, with a relatively stable high in 2017 at 12.48%, a sharp decline to 7.63% in 2018, and recovery in the subsequent years to 11.69% in 2019 and 12.29% in 2020. This margin trend highlights the profitability challenges experienced in 2018 and the effectiveness of recovery efforts afterwards.

Adjusted Net Income

Adjusted net income exhibits more pronounced fluctuations than net income. It increases substantially from 1,970 million USD in 2016 to a peak of 2,876 million USD in 2017, then drops sharply to 1,420 million USD in 2018. A recovery follows, with adjusted net income rising to 2,096 million USD in 2019 and reaching 2,537 million USD in 2020. These shifts suggest that adjustments in accounting or one-time items had notable impacts on reported profitability, especially in 2017 and 2018.

Adjusted Net Profit Margin

Adjusted net profit margins mirror the trend observed in adjusted net income. From 10.82% in 2016, there is a marked increase to 15.75% in 2017, followed by a substantial decrease to 7.68% in 2018. The margin then improves to 11.36% in 2019 and peaks again at 13.25% in 2020. The elevated margin in 2017 suggests particularly strong profitability excluding certain items, whereas 2018 reflects a period of reduced profitability even on an adjusted basis.

The financial data reveals notable fluctuations in the profitability and equity of the company over the five-year period analyzed.

Net Income Attributable to Kimberly-Clark Corporation

Net income displayed variability, starting at $2,166 million in 2016, increasing slightly to $2,278 million in 2017. It then experienced a significant drop to $1,410 million in 2018, followed by a recovery to $2,157 million in 2019 and further growth to $2,352 million in 2020. This pattern indicates a temporary setback in 2018, with a subsequent strong rebound over the following two years.

Total Kimberly-Clark Corporation Stockholders’ Equity

Reported total stockholders’ equity showed substantial negative volatility. Beginning with a negative balance of -$102 million in 2016, it worsened markedly to -$629 million in 2017, further declining to -$287 million in 2018 and -$33 million in 2019, before returning to a positive $626 million in 2020. These swings indicate instability in reported equity figures, culminating in an improvement by the end of the period.

Reported Return on Equity (ROE)

Reported ROE figures were only available for 2017 and 2020, both exhibiting exceptionally high percentages (362.16% in 2017 and 375.72% in 2020). Such unusually elevated returns may result from the negative equity figures in those years, which can distort the ROE calculation, suggesting caution in interpreting these values directly.

Adjusted Net Income

Adjusted net income follows a similar yet more pronounced trend compared to reported net income. It increased from $1,970 million in 2016 to $2,876 million in 2017, dropped sharply to $1,420 million in 2018, then rose steadily to $2,096 million in 2019 and further to $2,537 million in 2020. These adjustments likely reflect normalization or exclusion of extraordinary items, providing a clearer view of recurring profitability.

Adjusted Total Stockholders’ Equity

Adjusted stockholders’ equity shows a generally positive trajectory. Starting at $686 million in 2016, it nearly doubled to $1,337 million in 2017, fell considerably to $693 million in 2018, modestly recovered to $811 million in 2019, and surged to $1,630 million in 2020. This pattern indicates some volatility but an overall strengthening of equity base when adjustments are applied.

Adjusted Return on Equity (ROE)

Adjusted ROE remained at high levels throughout the period but exhibited a downward trend from 287.17% in 2016 to 155.64% in 2020. The ROE decreased steadily after peaking in 2016, suggesting diminishing returns on equity despite the improvement in adjusted equity figures. The high absolute values imply significant profitability relative to the equity base, though the downward trend may warrant monitoring.

In summary, while the company maintained strong profitability with occasional fluctuations, the reported equity figures exhibited instability, leading to highly volatile ROE calculations. The use of adjusted figures provides a more consistent view, showing a strengthening equity position and a decline in adjusted ROE over the period. This nuanced view highlights improvements in underlying financial health, tempered by a need for attention to the declining efficiency of equity utilization.

The financial data over the five-year period demonstrates several notable trends and fluctuations in key performance indicators.

Net Income

The net income attributable to the company showed an overall fluctuating pattern. Starting at $2,166 million in 2016, it increased slightly to $2,278 million in 2017, then declined sharply to $1,410 million in 2018. The net income rebounded in 2019 to $2,157 million and further increased to $2,352 million by the end of 2020. This pattern indicates a significant dip in profitability in 2018 followed by recovery and growth in subsequent years.

Total Assets

Total assets exhibited a generally upward trajectory. From $14,602 million in 2016, assets increased marginally to $15,151 million in 2017 but then decreased to $14,518 million in 2018. From 2018 onward, total assets increased steadily, reaching $15,283 million in 2019 and a more pronounced rise to $17,523 million in 2020. This growth in total assets suggests expansion or acquisition activities, especially notable in 2020.

Reported Return on Assets (ROA)

The reported ROA mirrored the volatility observed in net income. The metric was relatively strong at 14.83% in 2016 and slightly improved to 15.04% in 2017. There was a meaningful decline to 9.71% in 2018, corresponding with the drop in net income and total assets. ROA recovered to 14.11% in 2019 but slightly decreased to 13.42% by 2020, indicating some pressure on profitability relative to asset base despite asset growth.

Adjusted Net Income

Adjusted net income showed a pronounced increase in 2017, reaching $2,876 million from $1,970 million in 2016, suggesting the exclusion of certain adjustments or one-time items in that year. However, it fell sharply to $1,420 million in 2018, consistent with the trend in reported net income. The adjusted figure then increased to $2,096 million in 2019, followed by a further rise to $2,537 million in 2020, reflecting stronger underlying profitability when adjustments are considered.

Adjusted Total Assets

Adjusted total assets followed a pattern similar to total assets, starting at $15,115 million in 2016, increasing to $15,698 million in 2017, and then dipping to $15,016 million in 2018. The amount then stabilized slightly at $15,228 million in 2019 before a substantial increase to $17,440 million in 2020. This trend corroborates the asset growth seen in total assets, with a significant expansion in the most recent year.

Adjusted Return on Assets (ROA)

The adjusted ROA showed a marked improvement in 2017, jumping from 13.03% in 2016 to 18.32%, surpassing the reported ROA and indicating higher operational efficiency or profitability after adjustments. In 2018, it dropped to 9.46%, reflecting a difficult year consistent with other metrics. Subsequent years saw recovery with adjusted ROA increasing to 13.76% in 2019 and further to 14.55% in 2020, indicating improving returns on the adjusted asset base.

Overall, the financial data reflect a period of volatility around 2018, characterized by a decline in net income and returns, paired with a dip in asset values. However, subsequent years show a recovery in profitability and a significant increase in asset base, especially in 2020, indicating resumed growth and improved performance efficiency when considering adjusted figures. The adjusted metrics consistently show higher profitability ratios compared to reported figures, highlighting the impact of accounting adjustments on the company’s financial presentation.