UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~June~~September 30, 2020

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

Commission file number 1-225

KIMBERLY CLARK CORPORATON

(Exact name of registrant as specified in its charter)


Delaware						39-0394230
(State or other jurisdiction of incorporation)						(I.R.S. Employer Identification No.)

P.O. Box 619100

Dallas, TX

75261-9100

(Address of principal executive offices)

(Zip code)

(972) 281-1200

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	KMB	New York Stock Exchange
0.625% Notes due 2024	KMB24	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No x

As of ~~July 16,~~October 15, 2020, there were ~~341,047,156~~340,136,715 shares of the Corporation's common stock outstanding.

Table of Contents


PART I – FINANCIAL INFORMATION			1

Item 1. Financial Statements			1

UNAUDITED CONSOLIDATED INCOME STATEMENTS FOR THE THREE AND ~~SIX~~NINE MONTHS ENDED ~~JUNE~~SEPTEMBER 30, 2020 AND 2019			1
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE THREE AND ~~SIX~~NINE MONTHS ENDED ~~JUNE~~SEPTEMBER 30, 2020 AND 2019			2
CONSOLIDATED BALANCE SHEETS AS OF ~~JUNE~~SEPTEMBER 30, 2020 (UNAUDITED) AND DECEMBER 31, 2019			3
UNAUDITED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY FOR THE THREE AND ~~SIX~~NINE MONTHS ENDED ~~JUNE 3~~0SEPTEMBER , 30, 2020 AND 2019			4
UNAUDITED CONSOLIDATED CASH FLOW STATEMENTS FOR THE ~~THREE AND SIX~~NINE MONTHS ENDED ~~JUNE~~SEPTEMBER 30, 2020 AND 2019			6
UNAUDITED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS			7

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			15

Item 4. Controls and Procedures			23

PART II – OTHER INFORMATION			24

Item 1. Legal Proceedings			24

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			24

Item 6. Exhibits			25

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED INCOME STATEMENTS

(Unaudited)


		Three Months Ended June 30						Six Months Ended June 30							Three Months Ended September 30				Nine Months Ended September 30
(Millions of dollars, except per share amounts)	(Millions of dollars, except per share amounts)	2020		2019		2020		2019		(Millions of dollars, except per share amounts)	2020		2019		2020		2019
Net Sales	Net Sales	$	4,612	$	4,594	$	9,621	$	9,227	Net Sales	$	4,683	$	4,640	$	14,304	$	13,867
Cost of products sold	Cost of products sold	2,835		3,108		6,053		6,313		Cost of products sold	3,093		3,085		9,146		9,398
Gross Profit	Gross Profit	1,777		1,486		3,568		2,914		Gross Profit	1,590		1,555		5,158		4,469
Marketing, research and general expenses	Marketing, research and general expenses	844		811		1,717		1,580		Marketing, research and general expenses	919		815		2,636		2,395
Other (income) and expense, net	Other (income) and expense, net	8		5		22		9		Other (income) and expense, net	5		(175)		27		(166)
Operating Profit	Operating Profit	925		670		1,829		1,325		Operating Profit	666		915		2,495		2,240
Nonoperating expense	Nonoperating expense	(6)		(11)		(17)		(22)		Nonoperating expense	(40)		(11)		(57)		(33)
Interest income	Interest income	2		2		4		5		Interest income	2		3		6		8
Interest expense	Interest expense	(65)		(67)		(126)		(132)		Interest expense	(62)		(66)		(188)		(198)
Income Before Income Taxes and Equity Interests	Income Before Income Taxes and Equity Interests	856		594		1,690		1,176		Income Before Income Taxes and Equity Interests	566		841		2,256		2,017
Provision for income taxes	Provision for income taxes	(199)		(132)		(396)		(275)		Provision for income taxes	(114)		(192)		(510)		(467)
Income Before Equity Interests	Income Before Equity Interests	657		462		1,294		901		Income Before Equity Interests	452		649		1,746		1,550
Share of net income of equity companies	Share of net income of equity companies	35		33		73		60		Share of net income of equity companies	31		31		104		91
Net Income	Net Income	692		495		1,367		961		Net Income	483		680		1,850		1,641
Net income attributable to noncontrolling interests	Net income attributable to noncontrolling interests	(11)		(10)		(26)		(22)		Net income attributable to noncontrolling interests	(11)		(9)		(37)		(31)
Net Income Attributable to Kimberly-Clark Corporation	Net Income Attributable to Kimberly-Clark Corporation	$	681	$	485	$	1,341	$	939	Net Income Attributable to Kimberly-Clark Corporation	$	472	$	671	$	1,813	$	1,610

Per Share Basis	Per Share Basis									Per Share Basis
Net Income Attributable to Kimberly-Clark Corporation	Net Income Attributable to Kimberly-Clark Corporation									Net Income Attributable to Kimberly-Clark Corporation
Basic	Basic	$	2.00	$	1.41	$	3.93	$	2.73	Basic	$	1.38	$	1.95	$	5.32	$	4.68
Diluted	Diluted	$	1.99	$	1.40	$	3.92	$	2.71	Diluted	$	1.38	$	1.94	$	5.30	$	4.65

See notes to the unaudited interim consolidated financial statements.

KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)


		Three Months Ended June 30						Six Months Ended June 30							Three Months Ended September 30				Nine Months Ended September 30
(Millions of dollars)	(Millions of dollars)	2020		2019		2020		2019		(Millions of dollars)	2020		2019		2020		2019
Net Income	Net Income	$	692	$	495	$	1,367	$	961	Net Income	$	483	$	680	$	1,850	$	1,641
Other Comprehensive Income (Loss), Net of Tax	Other Comprehensive Income (Loss), Net of Tax									Other Comprehensive Income (Loss), Net of Tax
Unrealized currency translation adjustments	Unrealized currency translation adjustments	125		(4)		(274)		22		Unrealized currency translation adjustments	38		(170)		(236)		(148)
Employee postretirement benefits	Employee postretirement benefits	5		26		39		22		Employee postretirement benefits	0		16		39		38
Other	Other	(24)		(3)		8		(20)		Other	(3)		2		5		(18)
Total Other Comprehensive Income (Loss), Net of Tax	Total Other Comprehensive Income (Loss), Net of Tax	106		19		(227)		24		Total Other Comprehensive Income (Loss), Net of Tax	35		(152)		(192)		(128)
Comprehensive Income	Comprehensive Income	798		514		1,140		985		Comprehensive Income	518		528		1,658		1,513
Comprehensive (income) loss attributable to noncontrolling interests	Comprehensive (income) loss attributable to noncontrolling interests	(15)		(9)		(18)		(16)		Comprehensive (income) loss attributable to noncontrolling interests	(16)		1		(34)		(15)
Comprehensive Income Attributable to Kimberly-Clark Corporation	Comprehensive Income Attributable to Kimberly-Clark Corporation	$	783	$	505	$	1,122	$	969	Comprehensive Income Attributable to Kimberly-Clark Corporation	$	502	$	529	$	1,624	$	1,498

See notes to the unaudited interim consolidated financial statements.

KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(2020 Data is Unaudited)


(Millions of dollars)	(Millions of dollars)	June 30, 2020		December 31, 2019		(Millions of dollars)	September 30, 2020		December 31, 2019
ASSETS	ASSETS					ASSETS
Current Assets	Current Assets					Current Assets
Cash and cash equivalents	Cash and cash equivalents	$	1,448	$	442	Cash and cash equivalents	$	1,518	$	442
Accounts receivable, net	Accounts receivable, net	2,024		2,263		Accounts receivable, net	2,125		2,263
Inventories	Inventories	1,825		1,790		Inventories	1,787		1,790
Other current assets	Other current assets	607		562		Other current assets	645		562
Total Current Assets	Total Current Assets	5,904		5,057		Total Current Assets	6,075		5,057
Property, Plant and Equipment, Net	Property, Plant and Equipment, Net	7,366		7,450		Property, Plant and Equipment, Net	7,497		7,450
Investments in Equity Companies	Investments in Equity Companies	319		268		Investments in Equity Companies	333		268
Goodwill	Goodwill	1,401		1,467		Goodwill	1,418		1,467
Other Assets	Other Assets	1,183		1,041		Other Assets	1,208		1,041
TOTAL ASSETS	TOTAL ASSETS	$	16,173	$	15,283	TOTAL ASSETS	$	16,531	$	15,283

LIABILITIES AND STOCKHOLDERS' EQUITY	LIABILITIES AND STOCKHOLDERS' EQUITY					LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities	Current Liabilities					Current Liabilities
Debt payable within one year	Debt payable within one year	$	850	$	1,534	Debt payable within one year	$	517	$	1,534
Trade accounts payable	Trade accounts payable	3,032		3,055		Trade accounts payable	2,995		3,055
Accrued expenses and other current liabilities	Accrued expenses and other current liabilities	2,252		1,978		Accrued expenses and other current liabilities	2,230		1,978
Dividends payable	Dividends payable	360		352		Dividends payable	360		352
Total Current Liabilities	Total Current Liabilities	6,494		6,919		Total Current Liabilities	6,102		6,919
Long-Term Debt	Long-Term Debt	7,223		6,213		Long-Term Debt	7,851		6,213
Noncurrent Employee Benefits	Noncurrent Employee Benefits	859		897		Noncurrent Employee Benefits	873		897
Deferred Income Taxes	Deferred Income Taxes	527		511		Deferred Income Taxes	500		511
Other Liabilities	Other Liabilities	546		520		Other Liabilities	599		520
Redeemable Preferred Securities of Subsidiaries	Redeemable Preferred Securities of Subsidiaries	29		29		Redeemable Preferred Securities of Subsidiaries	29		29
Stockholders' Equity	Stockholders' Equity					Stockholders' Equity
Kimberly-Clark Corporation	Kimberly-Clark Corporation					Kimberly-Clark Corporation
Preferred stock - no par value - authorized 20.0 million shares, none issued	Preferred stock - no par value - authorized 20.0 million shares, none issued	—		—		Preferred stock - no par value - authorized 20.0 million shares, none issued	0		0
Common stock - $1.25 par value - authorized 1.2 billion shares; issued 378.6 million shares at June 30, 2020 and December 31, 2019		473		473
Common stock - $1.25 par value - authorized 1.2 billion shares; issued 378.6 million shares at September 30, 2020 and December 31, 2019						Common stock - $1.25 par value - authorized 1.2 billion shares; issued 378.6 million shares at September 30, 2020 and December 31, 2019	473		473
Additional paid-in capital	Additional paid-in capital	554		556		Additional paid-in capital	610		556
Common stock held in treasury, at cost - 37.6 and 37.1 million shares at June 30, 2020 and December 31, 2019, respectively		(4,545)		(4,454)
Common stock held in treasury, at cost - 38.2 and 37.1 million shares at September 30, 2020 and December 31, 2019, respectively						Common stock held in treasury, at cost - 38.2 and 37.1 million shares at September 30, 2020 and December 31, 2019, respectively	(4,661)		(4,454)
Retained earnings	Retained earnings	7,299		6,686		Retained earnings	7,395		6,686
Accumulated other comprehensive income (loss)	Accumulated other comprehensive income (loss)	(3,513)		(3,294)		Accumulated other comprehensive income (loss)	(3,482)		(3,294)
Total Kimberly-Clark Corporation Stockholders' Equity	Total Kimberly-Clark Corporation Stockholders' Equity	268		(33)		Total Kimberly-Clark Corporation Stockholders' Equity	335		(33)
Noncontrolling Interests	Noncontrolling Interests	227		227		Noncontrolling Interests	242		227
Total Stockholders' Equity	Total Stockholders' Equity	495		194		Total Stockholders' Equity	577		194
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	16,173	$	15,283	TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	16,531	$	15,283

See notes to the unaudited interim consolidated financial statements.

KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Unaudited)


		Three Months Ended June 30, 2020																																																							Three Months Ended September 30, 2020
(Millions of dollars, shares in thousands, except per share amounts)	(Millions of dollars, shares in thousands, except per share amounts)	Common Stock Issued							Additional Paid-in Capital	Treasury Stock								Retained Earnings		Accumulated Other Comprehensive Income (Loss)						Non-controlling Interests				Total Stockholders' Equity							(Millions of dollars, shares in thousands, except per share amounts)					Common Stock Issued										Additional Paid-in Capital		Treasury Stock															Retained Earnings		Accumulated Other Comprehensive Income (Loss)	Non-controlling Interests	Total Stockholders' Equity
			Shares			Amount				Shares		Amount																(Millions of dollars, shares in thousands, except per share amounts)											Shares				Amount				Additional Paid-in Capital				Shares			Amount								Retained Earnings		Accumulated Other Comprehensive Income (Loss)	Non-controlling Interests			Total Stockholders' Equity
Balance at March 31, 2020		378,597		$	473		$	559	37,761	$	(4,562)		$	6,978	$	(3,615)														$	213			$	46
Balance at June 30, 2020																	Balance at June 30, 2020		378,597			$	473							$	554			37,574						$	(4,545)							$	7,299			$	(3,513)					$	227							$	495
Net income in stockholders' equity, excludes redeemable interests' share	Net income in stockholders' equity, excludes redeemable interests' share	—		—			—		—	—			681		—					10				691			Net income in stockholders' equity, excludes redeemable interests' share					—				—								—	—				—										472				—				10			482
Other comprehensive income, net of tax, excludes redeemable interests' share	Other comprehensive income, net of tax, excludes redeemable interests' share	—		—			—		—	—			—		102					4				106			Other comprehensive income, net of tax, excludes redeemable interests' share					—				—								—	—			—										—				30				6			36
Stock-based awards exercised or vested	Stock-based awards exercised or vested	—		—			(38)		(557)	66			—		—					—				28			Stock-based awards exercised or vested					—				—								(2)	(672)			79										—				—				—			77
Shares repurchased	Shares repurchased	—		—			—		370	(49)			—		—					—				(49)			Shares repurchased					—				—								—	1,280			(195)										—				—				—			(195)
Recognition of stock-based compensation	Recognition of stock-based compensation	—		—			38		—	—			—		—					—				38			Recognition of stock-based compensation					—				—								45	—			—										—				—				—			45
Dividends declared ($1.07 per share)	Dividends declared ($1.07 per share)	—		—			—		—	—			(365)		—					—				(365)			Dividends declared ($1.07 per share)					—				—								—	—			—										(365)				—				—			(365)
Other	Other	—		—			(5)		—	—			5		—					—				—			Other					—				—								13	—			—										(11)				1				(1)			2
Balance at June 30, 2020		378,597		$	473		$	554	37,574	$	(4,545)		$	7,299	$	(3,513)				$	227			$	495
Balance at September 30, 2020																	Balance at September 30, 2020		378,597			$	473					$	610				38,182					$	(4,661)							$	7,395			$	(3,482)				$	242				$	577


		Six Months Ended June 30, 2020																																																										Nine Months Ended September 30, 2020
(Millions of dollars, shares in thousands, except per share amounts)	(Millions of dollars, shares in thousands, except per share amounts)	Common Stock Issued							Additional Paid-in Capital	Treasury Stock								Retained Earnings		Accumulated Other Comprehensive Income (Loss)						Non-controlling Interests				Total Stockholders' Equity									(Millions of dollars, shares in thousands, except per share amounts)			Common Stock Issued												Additional Paid-in Capital			Treasury Stock														Retained Earnings		Accumulated Other Comprehensive Income (Loss)			Non-controlling Interests			Total Stockholders' Equity
			Shares			Amount				Shares		Amount																(Millions of dollars, shares in thousands, except per share amounts)													Shares			Amount						Additional Paid-in Capital			Shares				Amount								Retained Earnings	Accumulated Other Comprehensive Income (Loss)		Non-controlling Interests		Total Stockholders' Equity
Balance at December 31, 2019	Balance at December 31, 2019	378,597		$	473		$	556	37,149	$	(4,454)		$	6,686	$	(3,294)														$	227					$	194						Balance at December 31, 2019		378,597		$	473							$	37,149					$	(4,454)												$	(3,294)		$	227		$	194
Net income in stockholders' equity, excludes redeemable interests' share	Net income in stockholders' equity, excludes redeemable interests' share	—		—			—		—	—			1,341		—					24				1,365			Net income in stockholders' equity, excludes redeemable interests' share						—						—							—		—					—											1,813			—				34		1,847
Other comprehensive income, net of tax, excludes redeemable interests' share	Other comprehensive income, net of tax, excludes redeemable interests' share	—		—			—		—	—			—		(219)					(8)				(227)			Other comprehensive income, net of tax, excludes redeemable interests' share					—						—							—		—				—											—			(189)				(2)			(191)
Stock-based awards exercised or vested	Stock-based awards exercised or vested	—		—			(52)		(1,622)	187			—		—					—				135			Stock-based awards exercised or vested					—						—							(54)		(2,294)				266											—			—				—		212
Shares repurchased	Shares repurchased	—		—			—		2,047	(278)			—		—					—				(278)			Shares repurchased					—						—							—		3,327				(473)											—			—				—		(473)
Recognition of stock-based compensation	Recognition of stock-based compensation	—		—			53		—	—			—		—					—				53			Recognition of stock-based compensation					—						—							98		—				—											—			—				—		98
Dividends declared ($2.14 per share)		—		—			—		—	—			(730)		—					(17)				(747)
Dividends declared ($3.21 per share)																	Dividends declared ($3.21 per share)		—			—							—						—						—									(1,095)			—						(17)					(1,112)
Other	Other	—		—			(3)		—	—			2		—					1				—			Other					—						—							10		—				—											(9)			1				—		2
Balance at June 30, 2020		378,597		$	473		$	554	37,574	$	(4,545)		$	7,299	$	(3,513)				$	227			$	495
Balance at September 30, 2020																	Balance at September 30, 2020		378,597			$	473					$	610					38,182						$	(4,661)								$	7,395		$	(3,482)					$	242				$	577

See notes to the unaudited interim consolidated financial statements.

KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Unaudited)


		Three Months Ended June 30, 2019																																																							Three Months Ended September 30, 2019
(Millions of dollars, shares in thousands, except per share amounts)	(Millions of dollars, shares in thousands, except per share amounts)	Common Stock Issued							Additional Paid-in Capital	Treasury Stock								Retained Earnings		Accumulated Other Comprehensive Income (Loss)						Non-controlling Interests				Total Stockholders' Equity							(Millions of dollars, shares in thousands, except per share amounts)					Common Stock Issued										Additional Paid-in Capital		Treasury Stock															Retained Earnings		Accumulated Other Comprehensive Income (Loss)	Non-controlling Interests	Total Stockholders' Equity
			Shares			Amount				Shares		Amount																(Millions of dollars, shares in thousands, except per share amounts)											Shares				Amount				Additional Paid-in Capital				Shares			Amount								Retained Earnings		Accumulated Other Comprehensive Income (Loss)	Non-controlling Interests			Total Stockholders' Equity
Balance at March 31, 2019		378,597		$	473		$	538	34,657	$	(4,075)		$	6,048	$	(3,289)														$	223			$	(82)
Balance at June 30, 2019																	Balance at June 30, 2019		378,597			$	473							$	510			34,381						$	(4,062)							$	6,170			$	(3,269)					$	228							$	50
Net income in stockholders' equity, excludes redeemable interests' share	Net income in stockholders' equity, excludes redeemable interests' share	—		—			—		—	—			485		—					9				494			Net income in stockholders' equity, excludes redeemable interests' share					—				—								—	—				—										671				—				8			679
Other comprehensive income, net of tax, excludes redeemable interests' share	Other comprehensive income, net of tax, excludes redeemable interests' share	—		—			—		—	—			—		20					(2)				18			Other comprehensive income, net of tax, excludes redeemable interests' share					—				—								—	—			—										—				(142)				(10)			(152)
Stock-based awards exercised or vested	Stock-based awards exercised or vested	—		—			(60)		(1,672)	192			—		—					—				132			Stock-based awards exercised or vested					—				—								(3)	(483)			55										—				—				—			52
Shares repurchased	Shares repurchased	—		—			—		1,396	(179)			—		—					—				(179)			Shares repurchased					—				—								—	1,562			(215)										—				—				—			(215)
Recognition of stock-based compensation	Recognition of stock-based compensation	—		—			31		—	—			—		—					—				31			Recognition of stock-based compensation					—				—								24	—			—										—				—				—			24
Dividends declared ($1.03 per share)	Dividends declared ($1.03 per share)	—		—			—		—	—			(355)		—					—				(355)			Dividends declared ($1.03 per share)					—				—								—	—			—										(354)				—				—			(354)
Other	Other	—		—			1		—	—			(8)		—					(2)				(9)			Other					—				—								4	—			—										(2)				(1)				3			4
Balance at June 30, 2019		378,597		$	473		$	510	34,381	$	(4,062)		$	6,170	$	(3,269)				$	228			$	50
Balance at September 30, 2019																	Balance at September 30, 2019		378,597			$	473					$	535				35,460					$	(4,222)							$	6,485			$	(3,412)				$	229				$	88


		Six Months Ended June 30, 2019																																																										Nine Months Ended September 30, 2019
(Millions of dollars, shares in thousands, except per share amounts)	(Millions of dollars, shares in thousands, except per share amounts)	Common Stock Issued							Additional Paid-in Capital	Treasury Stock								Retained Earnings		Accumulated Other Comprehensive Income (Loss)						Non-controlling Interests				Total Stockholders' Equity									(Millions of dollars, shares in thousands, except per share amounts)			Common Stock Issued												Additional Paid-in Capital			Treasury Stock														Retained Earnings		Accumulated Other Comprehensive Income (Loss)			Non-controlling Interests			Total Stockholders' Equity
			Shares			Amount				Shares		Amount																(Millions of dollars, shares in thousands, except per share amounts)													Shares			Amount						Additional Paid-in Capital			Shares				Amount								Retained Earnings	Accumulated Other Comprehensive Income (Loss)		Non-controlling Interests		Total Stockholders' Equity
Balance at December 31, 2018	Balance at December 31, 2018	378,597		$	473		$	548	33,635	$	(3,956)		$	5,947	$	(3,299)														$	241					$	(46)						Balance at December 31, 2018		378,597		$	473							$	33,635					$	(3,956)												$	(3,299)		$	241		$	(46)
Net income in stockholders' equity, excludes redeemable interests' share	Net income in stockholders' equity, excludes redeemable interests' share	—		—			—		—	—			939		—					20				959			Net income in stockholders' equity, excludes redeemable interests' share						—						—							—		—					—											1,610			—				28		1,638
Other comprehensive income, net of tax, excludes redeemable interests' share	Other comprehensive income, net of tax, excludes redeemable interests' share	—		—			—		—	—			—		30					(7)				23			Other comprehensive income, net of tax, excludes redeemable interests' share					—						—							—		—				—											—			(112)				(17)			(129)
Stock-based awards exercised or vested	Stock-based awards exercised or vested	—		—			(87)		(2,159)	247			—		—					—				160			Stock-based awards exercised or vested					—						—							(90)		(2,642)				302											—			—				—		212
Shares repurchased	Shares repurchased	—		—			—		2,905	(353)			—		—					—				(353)			Shares repurchased					—						—							—		4,467				(568)											—			—				—		(568)
Recognition of stock-based compensation	Recognition of stock-based compensation	—		—			48		—	—			—		—					—				48			Recognition of stock-based compensation					—						—							72		—				—											—			—				—		72
Dividends declared ($2.06 per share)		—		—			—		—	—			(709)		—					(24)				(733)
Dividends declared ($3.09 per share)																	Dividends declared ($3.09 per share)		—			—							—						—						—									(1,063)			—						(24)					(1,087)
Other	Other	—		—			1		—	—			(7)		—					(2)				(8)			Other					—						—							5		—				—											(9)			(1)				1		(4)
Balance at June 30, 2019		378,597		$	473		$	510	34,381	$	(4,062)		$	6,170	$	(3,269)				$	228			$	50
Balance at September 30, 2019																	Balance at September 30, 2019		378,597			$	473					$	535					35,460						$	(4,222)								$	6,485		$	(3,412)					$	229				$	88

See notes to the unaudited interim consolidated financial statements.

KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED CASH FLOW STATEMENTS

(Unaudited)


		Six Months Ended June 30							Nine Months Ended September 30
(Millions of dollars)	(Millions of dollars)	2020		2019		(Millions of dollars)	2020		2019
Operating Activities	Operating Activities					Operating Activities
Net income	Net income	$	1,367	$	961	Net income	$	1,850	$	1,641
Depreciation and amortization	Depreciation and amortization	414		470		Depreciation and amortization	606		700

Stock-based compensation	Stock-based compensation	54		48		Stock-based compensation	101		74
Deferred income taxes	Deferred income taxes	12		26		Deferred income taxes	(30)		8
Net (gains) losses on asset dispositions	Net (gains) losses on asset dispositions	13		17		Net (gains) losses on asset dispositions	67		(155)
Equity companies' earnings (in excess of) less than dividends paid	Equity companies' earnings (in excess of) less than dividends paid	(47)		(30)		Equity companies' earnings (in excess of) less than dividends paid	(53)		(31)
Operating working capital	Operating working capital	490		(525)		Operating working capital	292		(399)
Postretirement benefits	Postretirement benefits	(15)		(21)		Postretirement benefits	7		(16)
Other	Other	(5)		(20)		Other	2		(10)
Cash Provided by Operations	Cash Provided by Operations	2,283		926		Cash Provided by Operations	2,842		1,812
Investing Activities	Investing Activities					Investing Activities
Capital spending	Capital spending	(636)		(569)		Capital spending	(894)		(867)

Proceeds from dispositions of property						Proceeds from dispositions of property	5		206
Investments in time deposits	Investments in time deposits	(323)		(186)		Investments in time deposits	(509)		(353)
Maturities of time deposits	Maturities of time deposits	254		229		Maturities of time deposits	404		287
Other	Other	15		4		Other	17		(40)
Cash Used for Investing	Cash Used for Investing	(690)		(522)		Cash Used for Investing	(977)		(767)
Financing Activities	Financing Activities					Financing Activities
Cash dividends paid	Cash dividends paid	(722)		(700)		Cash dividends paid	(1,087)		(1,054)
Change in short-term debt	Change in short-term debt	(667)		543		Change in short-term debt	(497)		324
Debt proceeds	Debt proceeds	1,241		696		Debt proceeds	1,842		700
Debt repayments	Debt repayments	(252)		(703)		Debt repayments	(753)		(705)
Proceeds from exercise of stock options	Proceeds from exercise of stock options	135		160		Proceeds from exercise of stock options	212		211
Acquisitions of common stock for the treasury	Acquisitions of common stock for the treasury	(263)		(330)		Acquisitions of common stock for the treasury	(449)		(544)
Other	Other	(39)		(79)		Other	(40)		(92)
Cash Used for Financing	Cash Used for Financing	(567)		(413)		Cash Used for Financing	(772)		(1,160)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	Effect of Exchange Rate Changes on Cash and Cash Equivalents	(20)		4		Effect of Exchange Rate Changes on Cash and Cash Equivalents	(17)		(8)
Change in Cash and Cash Equivalents	Change in Cash and Cash Equivalents	1,006		(5)		Change in Cash and Cash Equivalents	1,076		(123)
Cash and Cash Equivalents - Beginning of Period	Cash and Cash Equivalents - Beginning of Period	442		539		Cash and Cash Equivalents - Beginning of Period	442		539
Cash and Cash Equivalents - End of Period	Cash and Cash Equivalents - End of Period	$	1,448	$	534	Cash and Cash Equivalents - End of Period	$	1,518	$	416

See notes to the unaudited interim consolidated financial statements.

KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1. Accounting Policies

Basis of Presentation

The accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all material adjustments which are of a normal and recurring nature necessary for a fair presentation of the results for the periods presented have been reflected. Dollar amounts are reported in millions, except per share dollar amounts, unless otherwise noted.

For further information, refer to the consolidated financial statements and footnotes included in our Annual Report on Form 10-K for the year ended December 31, 2019. The terms "Corporation," "Kimberly-Clark," "K-C," "we," "our" and "us" refer to Kimberly-Clark Corporation and its consolidated subsidiaries.

Highly Inflationary Accounting in Argentina

GAAP guidance requires the use of highly inflationary accounting for countries whose cumulative three-year inflation exceeds 100 percent. In the second quarter of 2018, published inflation indices indicated that the three-year cumulative inflation in Argentina exceeded 100 percent, and as of July 1, 2018, we elected to adopt highly inflationary accounting for our subsidiaries in Argentina (“K-C Argentina”). Under highly inflationary accounting, K-C Argentina’s functional currency became the U.S. dollar, and its income statement and balance sheet have been measured in U.S. dollars using both current and historical rates of exchange. The effect of changes in exchange rates on peso-denominated monetary assets and liabilities has been reflected in earnings in Other (income) and expense, net and was not material. As of ~~June~~September 30, 2020, K-C Argentina had a small net peso monetary position. Net sales of K-C Argentina were approximately 1 percent of our consolidated net sales for the ~~six~~nine months ended ~~June~~September 30, 2020 and 2019.

Recently Adopted Accounting Standards

The Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No. 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40). The new guidance reduces complexity for the accounting for costs of implementing a cloud computing service arrangement and aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal use software license). We adopted this standard as of January 1, 2020 on a prospective basis. The effects of this standard on our financial position, results of operations and cash flows were not material.

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This guidance provides temporary optional expedients and exceptions to accounting guidance on contract modifications and hedge accounting to ease entities’ financial reporting burdens as the market transitions from the London Interbank Offered Rate (LIBOR) and other interbank offered rates to alternative reference rates. The guidance was effective upon issuance and generally can be applied through December 31, 2022. The effects of this standard on our financial position, results of operations and cash flows are not expected to be material.

Accounting Standards Issued - Not Yet Adopted

The FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes (Topic 740). The new guidance simplifies the accounting for income taxes by eliminating certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, the calculation of the income tax impact of hybrid taxes, tax basis of goodwill after a business combination and ~~the~~ recognition of deferred tax liabilities for outside basis differences. It also clarifies and simplifies other aspects of the accounting for income taxes. For public companies, the amendments in this ASU are effective for fiscal years beginning after December 15, 2020 and interim periods within those fiscal years. Early adoption is permitted in interim or annual periods with any adjustments reflected as of the beginning of the annual period that includes that interim period. Additionally, entities that elect early adoption must adopt all the amendments in the same period. Amendments are to be applied prospectively, except for certain amendments that are to be applied either retrospectively or with a modified retrospective approach through a cumulative effect adjustment recorded to retained earnings. The effects of this standard on our financial position, results of operations or cash flows are not expected to be material.

Note 2. 2018 Global Restructuring Program

In January 2018, we announced the 2018 Global Restructuring Program to reduce our structural cost base by streamlining and simplifying our manufacturing supply chain and overhead organization. We expect to close or sell approximately 10 manufacturing facilities and expand production capacity at several others. We expect to exit or divest some lower-margin businesses that generate approximately 1 percent of our net sales. The restructuring is expected to impact our organizations in all major geographies. Workforce reductions are expected to be in the range of 5,000 to 5,500. Certain capital appropriations under the 2018 Global Restructuring Program are being finalized. Accounting for actions related to each appropriation will commence when the appropriation is authorized for execution.

The restructuring is expected to be completed in 2021, with total costs anticipated to be toward the high end of the range of $1.7 billion to $1.9 billion pre-tax ($1.3 billion to $1.4 billion after tax). Cash costs are expected to be $900 to $1.0 billion, primarily related to workforce reductions. Non-cash charges are expected to be $800 to $900 pre-tax and will primarily consist of incremental depreciation, asset write-offs and pension settlement and curtailment charges.

The following net charges were incurred in connection with the 2018 Global Restructuring Program:


		Three Months Ended June 30						Six Months Ended June 30							Three Months Ended September 30				Nine Months Ended September 30
		2020		2019		2020		2019			2020		2019		2020		2019
Cost of products sold:	Cost of products sold:									Cost of products sold:
Charges for workforce reductions	Charges for workforce reductions	$	1	$	2	$	1	$	32	Charges for workforce reductions	$	15	$	1	$	16	$	33

Asset write-offs	Asset write-offs	3		15		9		27		Asset write-offs	50		18		59		45
Incremental depreciation	Incremental depreciation	33		65		68		132		Incremental depreciation	18		57		86		189
Other exit costs	Other exit costs	23		20		52		36		Other exit costs	24		28		76		64
Total	Total	60		102		130		227		Total	107		104		237		331
Marketing, research and general expenses:	Marketing, research and general expenses:									Marketing, research and general expenses:
Charges (adjustments) for workforce reductions	Charges (adjustments) for workforce reductions	1		(12)		(2)		(8)		Charges (adjustments) for workforce reductions	1		(4)		(1)		(12)
Other exit costs	Other exit costs	26		29		52		53		Other exit costs	24		25		76		78
Total	Total	27		17		50		45		Total	25		21		75		66
Other (income) and expense, net	Other (income) and expense, net	—		—		—		(1)		Other (income) and expense, net	(1)		(181)		(1)		(182)
Nonoperating expense										Nonoperating expense	26		0		26		0
Total charges	Total charges	87		119		180		271		Total charges	157		(56)		337		215
Provision for income taxes	Provision for income taxes	(15)		(27)		(33)		(58)		Provision for income taxes	(50)		23		(83)		(35)
Net charges	Net charges	72		92		147		213		Net charges	107		(33)		254		180
Net impact related to equity companies and noncontrolling interests	Net impact related to equity companies and noncontrolling interests	—		—		(1)		1		Net impact related to equity companies and noncontrolling interests	0		0		(1)		1
Net charges attributable to Kimberly-Clark Corporation	Net charges attributable to Kimberly-Clark Corporation	$	72	$	92	$	146	$	214	Net charges attributable to Kimberly-Clark Corporation	$	107	$	(33)	$	253	$	181

Other (income) and expense, net in 2019 includes a pre-tax gain of approximately $182 on the sale of a manufacturing facility and associated real estate which were disposed of as part of the restructuring.

The following summarizes the restructuring liabilities activity:


		2020		2019			2020		2019
Restructuring liabilities at January 1	Restructuring liabilities at January 1	$	132	$	210	Restructuring liabilities at January 1	$	132	$	210
Charges for workforce reductions and other cash exit costs	Charges for workforce reductions and other cash exit costs	99		112		Charges for workforce reductions and other cash exit costs	162		159
Cash payments	Cash payments	(122)		(142)		Cash payments	(177)		(230)
Currency and other	Currency and other	(3)		6		Currency and other	(3)		3
Restructuring liabilities at June 30		$	106	$	186
Restructuring liabilities at September 30						Restructuring liabilities at September 30	$	114	$	142

Restructuring liabilities of ~~$75~~$80 and ~~$125~~$84 are recorded in Accrued expenses and other current liabilities and ~~$31~~$34 and ~~$61~~$58 are recorded in Other Liabilities as of ~~June~~September 30, 2020 and 2019, respectively. The impact related to restructuring charges is recorded in Operating working capital and Other Operating Activities, as appropriate, in our consolidated cash flow statements.

Through ~~June~~September 30, 2020, cumulative pre-tax charges for the 2018 Global Restructuring Program were ~~$1.6~~$1.7 billion ($~~1.2~~1.3 billion after tax).

Note 3. Income Taxes

The U.S. Internal Revenue Service ("IRS") is currently auditing our federal tax return for the taxable year ended December 31, 2017. As part of this tax audit, the IRS is reviewing our one-time transition tax on certain undistributed earnings of foreign subsidiaries under the Tax Cuts and Jobs Act of 2017. The IRS has proposed an adjustment that would increase the amount of the transition tax owed by us. We believe we have adequate reserves and meritorious defenses and intend to vigorously defend against the proposed adjustment; however, it is expected to take a number of years to reach resolution of this matter.

Note 3.4. Fair Value Information

The following fair value information is based on a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The three levels in the hierarchy used to measure fair value are:

Level 1 – Unadjusted quoted prices in active markets accessible at the reporting date for identical assets and liabilities.

Level 2 – Quoted prices for similar assets or liabilities in active markets. Quoted prices for identical or similar assets and liabilities in markets that are not considered active or financial instruments for which all significant inputs are observable, either directly or indirectly.

Level 3 – Prices or valuations that require inputs that are significant to the valuation and are unobservable.

A financial instrument's level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

During the ~~six~~nine months ended ~~June~~September 30, 2020 and for the full year 2019, there were no significant transfers to or from level 3 fair value determinations.

Derivative assets and liabilities are measured on a recurring basis at fair value. At ~~June~~September 30, 2020 and December 31, 2019, derivative assets were ~~$113~~$70 and $34, respectively, and derivative liabilities were ~~$28~~$32 and $44, respectively. The fair values of derivatives used to manage interest rate risk and commodity price risk are based on LIBOR rates and interest rate swap curves and NYMEX price quotations, respectively. The fair values of hedging instruments used to manage foreign currency risk are based on published quotations of spot currency rates and forward points, which are converted into implied forward currency rates. Measurement of our derivative assets and liabilities is considered a level 2 measurement. Additional information on our classification and use of derivative instruments is contained in Note 6.7.

Redeemable preferred securities of subsidiaries are measured on a recurring basis at fair value and were $29 as of ~~June~~September 30, 2020 and December 31, 2019. They are not traded in active markets. ~~As of June 30, 2020, the~~The fair values of the redeemable securities were based on a discounted cash flow valuation model. Measurement of the redeemable preferred securities is considered a level 3 measurement.

Company-owned life insurance ("COLI") assets are measured on a recurring basis at fair value. COLI assets were ~~$69~~$71 and $76 at ~~June~~September 30, 2020 and December 31, 2019, respectively. The COLI policies are a source of funding primarily for our nonqualified employee benefits and are included in Other Assets. The COLI policies are measured at fair value using the net asset value per share practical expedient, and therefore, are not classified in the fair value hierarchy.

The following table includes the fair value of our financial instruments for which disclosure of fair value is required:


		Fair Value Hierarchy Level	Carrying Amount			Estimated Fair Value		Carrying Amount		Estimated Fair Value			Fair Value Hierarchy Level		Carrying Amount			Estimated Fair Value			Carrying Amount					Estimated Fair Value
														Fair Value Hierarchy Level
					June 30, 2020							December 31, 2019							Fair Value Hierarchy Level						September 30, 2020					December 31, 2019
Assets	Assets											Assets
Cash and cash equivalents^(a)	Cash and cash equivalents^(a)	1	$	1,448		$	1,448	$	442	$	442	Cash and cash equivalents^(a)	1			$	1,518			$	1,518		$	442				$	442
Time deposits^(b)	Time deposits^(b)	1	336			336		275		275		Time deposits^(b)	1		380			380						275					275

Liabilities	Liabilities											Liabilities
Short-term debt^(c)	Short-term debt^(c)	2	93			93		775		775		Short-term debt^(c)	2		260			260				775					775

Long-term debt^(d)	Long-term debt^(d)	2	7,980			9,410		6,972		7,877		Long-term debt^(d)	2		8,108			9,590			6,972					7,877

(a)Cash equivalents are composed of certificates of deposit, time deposits and other interest-bearing investments with original maturity dates of 90 days or less. Cash equivalents are recorded at cost, which approximates fair value. Cash of approximately $600 from debt issued to partially fund the acquisition of Softex Indonesia represented restricted cash as of September 30, 2020 as the debt was subject to a special mandatory redemption provision. This provision lapsed upon the close of the acquisition. See Note 11 for details.

(b)Time deposits are composed of deposits with original maturities of more than 90 days but less than one year and instruments with original maturities of greater than one year, included in Other current assets or Other Assets in the consolidated balance sheet, as appropriate. Time deposits are recorded at cost, which approximates fair value.

(c)Short-term debt is composed of U.S. commercial paper and/or other similar short-term debt issued by non-U.S. subsidiaries, all of which are recorded at cost, which approximates fair value.

(d)Long-term debt includes the current portion of these debt instruments. Fair values were estimated based on quoted prices for financial instruments for which all significant inputs were observable, either directly or indirectly.

Note 4.5. Earnings Per Share ("EPS")

There are no adjustments required to be made to net income for purposes of computing EPS. The average number of common shares outstanding is reconciled to those used in the basic and diluted EPS computations as follows:


		Three Months Ended June 30			Six Months Ended June 30				Three Months Ended September 30		Nine Months Ended September 30
(Millions of shares)	(Millions of shares)	2020	2019	2020	2019	(Millions of shares)	2020	2019	2020	2019
Basic	Basic	340.9	344.2	341.1	344.3	Basic	341.0	343.8	341.1	344.1
Dilutive effect of stock options and restricted share unit awards	Dilutive effect of stock options and restricted share unit awards	1.0	1.8	1.2	1.7	Dilutive effect of stock options and restricted share unit awards	1.3	2.1	1.2	1.9
Diluted	Diluted	341.9	346.0	342.3	346.0	Diluted	342.3	345.9	342.3	346.0

The impact of options outstanding that were not included in the computation of diluted EPS because their exercise price was greater than the average market price of the common shares was insignificant. The number of common shares outstanding as of ~~June~~September 30, 2020 and 2019 was ~~341.0~~340.4 million and ~~344.2~~343.1 million, respectively.

Note 5.6. Stockholders' Equity

Net unrealized currency gains or losses resulting from the translation of assets and liabilities of foreign subsidiaries, except those in highly inflationary economies, are recorded in Accumulated Other Comprehensive Income ("AOCI"). For these operations, changes in exchange rates generally do not affect cash flows; therefore, unrealized translation adjustments are recorded in AOCI rather than net income. Upon sale or substantially complete liquidation of any of these subsidiaries, the applicable unrealized translation would be removed from AOCI and reported as part of the gain or loss on the sale or liquidation.

Also included in unrealized translation amounts are the effects of foreign exchange rate changes on intercompany balances of a long-term investment nature and transactions designated as hedges of net foreign investments.

The change in net unrealized currency translation for the ~~six~~nine months ended ~~June~~September 30, 2020 was primarily due to weakening of foreign currencies versus the U.S. ~~dollar.~~dollar, particularly the Brazilian real.

The changes in the components of AOCI attributable to Kimberly-Clark, net of tax, are as follows:


		Unrealized Translation		Defined Benefit Pension Plans			Other Postretirement Benefit Plans			Cash Flow Hedges and Other			Unrealized Translation		Defined Benefit Pension Plans			Other Postretirement Benefit Plans			Cash Flow Hedges and Other
Balance as of December 31, 2018	Balance as of December 31, 2018	$	(2,297)	$	(1,017)		$	12		$	3	Balance as of December 31, 2018	$	(2,297)	$	(1,017)		$	12		$	3
Other comprehensive income (loss) before reclassifications	Other comprehensive income (loss) before reclassifications	29		1			15			(12)		Other comprehensive income (loss) before reclassifications	(132)		1			16			(6)
(Income) loss reclassified from AOCI	(Income) loss reclassified from AOCI	—		6		(a)	(1)		(a)	(8)		(Income) loss reclassified from AOCI	0		22		(a)	(1)		(a)	(13)
Net current period other comprehensive income (loss)	Net current period other comprehensive income (loss)	29		7			14			(20)		Net current period other comprehensive income (loss)	(132)		23			15			(19)

Balance as of June 30, 2019		$	(2,268)	$	(1,010)		$	26		$	(17)
Balance as of September 30, 2019												Balance as of September 30, 2019	$	(2,429)	$	(994)		$	27		$	(16)

Balance as of December 31, 2019	Balance as of December 31, 2019	$	(2,271)	$	(979)		$	(13)		$	(31)	Balance as of December 31, 2019	$	(2,271)	$	(979)		$	(13)		$	(31)
Other comprehensive income (loss) before reclassifications	Other comprehensive income (loss) before reclassifications	(266)		22			2			17		Other comprehensive income (loss) before reclassifications	(233)		(19)			3			15
(Income) loss reclassified from AOCI	(Income) loss reclassified from AOCI	—		16		(a)	(1)		(a)	(9)		(Income) loss reclassified from AOCI	0		57		(a)	(1)		(a)	(10)
Net current period other comprehensive income (loss)	Net current period other comprehensive income (loss)	(266)		38			1			8		Net current period other comprehensive income (loss)	(233)		38			2			5

Balance as of June 30, 2020		$	(2,537)	$	(941)		$	(12)		$	(23)
Balance as of September 30, 2020												Balance as of September 30, 2020	$	(2,504)	$	(941)		$	(11)		$	(26)

(a) Included in computation of net periodic benefit costs.

Note 6.7. Objectives and Strategies for Using Derivatives

As a multinational enterprise, we are exposed to financial risks, such as changes in foreign currency exchange rates, interest rates, and commodity prices. We employ a number of practices to manage these risks, including operating and financing activities and, where appropriate, the use of derivative instruments.

At ~~June~~September 30, 2020 and December 31, 2019, derivative assets were ~~$113~~$70 and $34, respectively, and derivative liabilities were ~~$28~~$32 and $44, respectively, primarily comprised of foreign currency exchange contracts. Derivative assets are recorded in Other

current assets or Other Assets, as appropriate, and derivative liabilities are recorded in Accrued expenses and other current liabilities or Other Liabilities, as appropriate.

Foreign Currency Exchange Rate Risk

Translation adjustments result from translating foreign entities' financial statements into U.S. dollars from their functional currencies. The risk to any particular entity's net assets is reduced to the extent that the entity is financed with local currency borrowings. A portion of our balance sheet translation exposure for certain affiliates, which results from changes in translation rates between the affiliates’ functional currencies and the U.S. dollar, is hedged with cross-currency swap contracts and certain foreign denominated debt which are designated as net investment hedges. The foreign currency exposure on certain non-functional currency denominated monetary assets and liabilities, primarily intercompany loans and accounts payable, is hedged with primarily undesignated derivative instruments.

Derivative instruments are entered into to hedge a portion of forecasted cash flows denominated in foreign currencies for non-U.S. operations' purchases of raw materials, which are priced in U.S. dollars, and imports of intercompany finished goods and work-in-process priced predominantly in U.S. dollars and euros. The derivative instruments used to manage these exposures are designated as cash flow hedges.

Interest Rate Risk

Interest rate risk is managed using a portfolio of variable and fixed-rate debt composed of short and long-term instruments. Interest rate swap contracts may be used to facilitate the maintenance of the desired ratio of variable and fixed-rate debt and are designated as fair value hedges. From time to time, we also hedge the anticipated issuance of fixed-rate debt, and these contracts are designated as cash flow hedges.

Commodity Price Risk

We use derivative instruments, such as forward contracts, to hedge a limited portion of our exposure to market risk arising from changes in prices of certain commodities. These derivatives are designated as cash flow hedges of specific quantities of the underlying commodity expected to be purchased in future months. In addition, we utilize negotiated short-term contract structures, including fixed price contracts, to manage volatility for a portion of our commodity costs.

Fair Value Hedges

Derivative instruments that are designated and qualify as fair value hedges are predominantly used to manage interest rate risk. The fair values of these interest rate derivative instruments are recorded as an asset or liability, as appropriate, with the offset recorded in Interest expense. The offset to the change in fair values of the related debt is also recorded in Interest expense. Any realized gain or loss on the derivatives that hedge interest rate risk is amortized to Interest expense over the life of the related debt. As of ~~June~~September 30, 2020, the aggregate notional values and carrying values of outstanding interest rate contracts designated as fair value hedges were $300 and ~~$325,~~$323, respectively. For the ~~six~~nine months ended ~~June~~September 30, 2020 and 2019, gains or losses recognized in Interest expense for interest rate swaps were not significant.

Cash Flow Hedges

For derivative instruments that are designated and qualify as cash flow hedges, the gain or loss on the derivative instrument is initially recorded in AOCI, net of related income taxes, and recognized in earnings in the same income statement line and period that the hedged exposure affects earnings. As of ~~June~~September 30, 2020, outstanding commodity forward contracts were in place to hedge a limited portion of our estimated requirements of the related underlying commodities in the remainder of 2020 and future periods. As of ~~June~~September 30, 2020, the aggregate notional value of outstanding foreign exchange derivative contracts designated as cash flow hedges was ~~$663.~~$692. For the ~~six~~nine months ended ~~June~~September 30, 2020 and 2019, no significant gains or losses were reclassified into Interest expense, Cost of products sold or Other (income) and expense, net as a result of the discontinuance of cash flow hedges due to the original forecasted transaction no longer being probable of occurring. At ~~June~~September 30, 2020, amounts to be reclassified from AOCI into Interest expense, Cost of products sold or Other (income) and expense, net during the next twelve months are not expected to be material. The maximum maturity of cash flow hedges in place at ~~June~~September 30, 2020 is ~~June~~September 2022.

Net Investment Hedges

For derivative instruments that are designated and qualify as net investment hedges, the aggregate notional value was $1.5 billion at ~~June~~September 30, 2020. We exclude the interest accruals on cross-currency swap contracts and the forward points on foreign exchange forward contracts from the assessment and measurement of hedge effectiveness. We recognize the interest accruals on cross-currency swap contracts in earnings within Interest expense. We amortize the forward points on foreign exchange contracts into earnings within Interest expense over the life of the hedging relationship. Changes in fair value of net investment hedges are recorded in AOCI and offset the change in the value of the net investment being hedged. For the ~~six~~nine months ended ~~June~~September 30, 2020, unrealized gains of ~~$71~~$13 related to net investment hedge fair value changes were recorded in AOCI and no significant amounts were reclassified from AOCI to Interest expense.

No significant amounts were excluded from the assessment of net investment, fair value or cash flow hedge effectiveness as of ~~June~~September 30, 2020.

Undesignated Hedging Instruments

Gains or losses on undesignated foreign exchange hedging instruments are immediately recognized in Other (income) and expense, net. A gain of ~~$12~~$23 and loss of $5$14 were recorded in the three months ended ~~June~~September 30, 2020 and 2019, respectively. A gain of $8$31 and loss of ~~$13~~$27 were recorded in the ~~six~~nine months ended ~~June~~September 30, 2020 and 2019, respectively. The effect on earnings from the use of these non-designated derivatives is substantially neutralized by the transactional gains and losses recorded on the underlying assets and liabilities. At ~~June~~September 30, 2020, the notional value of these undesignated derivative instruments was approximately $1.7 billion.

Note 8. Legal Matters

We are party to certain legal proceedings relating to our former health care business, Avanos Medical, Inc. ("Avanos", previously Halyard Health, Inc.), as described in our Form 10-K for the year ended December 31, 2019, including consumer class actions, qui tam matters, a shareholder derivative suit, a securities class action and certain subpoena and document requests from the federal government. During the third quarter of 2020, in the California consumer class action Bahamas Surgery Center v. Kimberly-Clark Corporation, et al., the Ninth Circuit Court of Appeals vacated the award against us for compensatory and punitive damages and decertified the class. The court denied the plaintiff’s subsequent appeal requesting a rehearing. The shareholder derivative suit and the securities class action have also been dismissed.

Note 7.9. Business Segment Information

We are organized into operating segments based on product groupings. These operating segments have been aggregated into three reportable global business segments: Personal Care, Consumer Tissue and K-C Professional. The reportable segments were determined in accordance with how our chief operating decision maker and our executive managers develop and execute global strategies to drive growth and profitability. These strategies include global plans for branding and product positioning, technology, research and development programs, cost reductions including supply chain management, and capacity and capital investments for each of these businesses. Segment management is evaluated on several factors, including operating profit. Segment operating profit excludes Other (income) and expense, net and income and expense not associated with ongoing operations of the business segments, including the costs of corporate decisions related to the 2018 Global Restructuring Program described in Note 2.2 and acquisition-related costs associated with the acquisition of Softex Indonesia as described in Note 11.

The principal sources of revenue in each global business segment are described below:

•Personal Care brands offer our consumers a trusted partner in caring for themselves and their families by delivering confidence, protection and discretion through a wide variety of innovative solutions and products such as disposable diapers, training and youth pants, swimpants, baby wipes, feminine and incontinence care products, and other related products. Products in this segment are sold under the Huggies, Pull-Ups, Little Swimmers, GoodNites, DryNites, Kotex, U by Kotex, Intimus, Depend, Plenitud, Poise and other brand names.

•Consumer Tissue offers a wide variety of innovative solutions and trusted brands that responsibly improve everyday living for families around the world. Products in this segment include facial and bathroom tissue, paper towels, napkins and related products, and are sold under the Kleenex, Scott, Cottonelle, Viva, Andrex, Scottex, Neve and other brand names.

•K-C Professional partners with businesses to create Exceptional Workplaces, helping to make them healthier, safer and more productive through a range of solutions and supporting products such as wipers, tissue, towels, apparel, soaps and sanitizers. Our brands, including Kleenex, Scott, WypAll, Kimtech and KleenGuard are well known for quality and trusted to help people around the world work better.

Information concerning consolidated operations by business segment is presented in the following tables:


		Three Months Ended June 30								Six Months Ended June 30									Three Months Ended September 30								Nine Months Ended September 30
		2020		2019		Change		2020		2019		Change			2020		2019		Change		2020		2019		Change
NET SALES	NET SALES													NET SALES
Personal Care	Personal Care	$	2,229	$	2,286	-2	%	$	4,651	$	4,561	+2	%	Personal Care	$	2,339	$	2,305	+1	%	$	6,990	$	6,866	+2	%
Consumer Tissue	Consumer Tissue	1,645		1,472		+12	%	3,368		2,998		+12	%	Consumer Tissue	1,623		1,484		+9	%	4,991		4,482		+11	%
K-C Professional	K-C Professional	724		821		-12	%	1,572		1,638		-4	%	K-C Professional	705		839		-16	%	2,277		2,477		-8	%
Corporate & Other	Corporate & Other	14		15		N.M.		30		30		N.M.		Corporate & Other	16		12		N.M.		46		42		N.M.
TOTAL NET SALES	TOTAL NET SALES	$	4,612	$	4,594	—	%	$	9,621	$	9,227	+4		TOTAL NET SALES	$	4,683	$	4,640	+1	%	$	14,304	$	13,867	+3	%

OPERATING PROFIT	OPERATING PROFIT													OPERATING PROFIT
Personal Care	Personal Care	$	519	$	485	+7	%	$	1,046	$	969	+8	%	Personal Care	$	486	$	490	-1	%	$	1,532	$	1,459	+5	%
Consumer Tissue	Consumer Tissue	428		221		+94	%	793		462		+72	%	Consumer Tissue	318		264		+20	%	1,111		726		+53	%
K-C Professional	K-C Professional	155		162		-4	%	336		312		+8	%	K-C Professional	87		176		-51	%	423		488		-13	%
Corporate & Other^(a)	Corporate & Other^(a)	(169)		(193)		N.M.		(324)		(409)		N.M.		Corporate & Other^(a)	(220)		(190)		N.M.		(544)		(599)		N.M.
Other (income) and expense, net^(a)	Other (income) and expense, net^(a)	8		5		+60	%	22		9		+144	%	Other (income) and expense, net^(a)	5		(175)		N.M.		27		(166)		N.M.
TOTAL OPERATING PROFIT	TOTAL OPERATING PROFIT	$	925	$	670	+38	%	$	1,829	$	1,325	+38	%	TOTAL OPERATING PROFIT	$	666	$	915	-27	%	$	2,495	$	2,240	+11	%

(a) Corporate & Other and Other (income) and expense, net include income and expense not associated with the business segments, including charges related to the 2018 Global Restructuring ~~Program.~~Program and Softex Indonesia acquisition-related costs. Restructuring charges related to the Personal Care, Consumer Tissue and K-C Professional business segments were ~~$40, $34 and $11, respectively, for the three months ended June 30, 2020, $66, $36~~$57, $59 and $15, respectively, for the three months ended ~~June~~September 30, ~~2019, $74, $76~~2020, $53, $49 and ~~$26,~~$21, respectively, for the ~~six~~three months ended ~~June~~September 30, 2019, $131, $135 and $41, respectively, for the nine months ended September 30, 2020 and ~~$155, $82~~$208, $131 and ~~$31,~~$52, respectively for the ~~six~~nine months ended ~~June~~September 30, 2019.

N.M. - Not Meaningful

Sales of Principal Products


		Three Months Ended June 30						Six Months Ended June 30							Three Months Ended September 30				Nine Months Ended September 30
(Billions of dollars)	(Billions of dollars)	2020		2019		2020		2019		(Billions of dollars)	2020		2019		2020		2019
Baby and child care products	Baby and child care products	1.5		1.6		3.2		3.1		Baby and child care products	1.6		1.6		4.8		4.7
Consumer tissue products	Consumer tissue products	1.6		1.5		3.4		3.0		Consumer tissue products	1.6		1.5		5.0		4.5
Away-from-home professional products	Away-from-home professional products	0.7		0.8		1.6		1.6		Away-from-home professional products	0.7		0.8		2.3		2.5
All other	All other	0.8		0.7		1.4		1.5		All other	0.8		0.7		2.2		2.2
Consolidated	Consolidated	$	4.6	$	4.6	$	9.6	$	9.2	Consolidated	$	4.7	$	4.6	$	14.3	$	13.9

Note 8.10. Supplemental Balance Sheet Data

The following schedule presents a summary of inventories by major class:


		June 30, 2020										December 31, 2019											September 30, 2020				December 31, 2019
		LIFO		Non-LIFO		Total		LIFO		Non-LIFO		Total			LIFO		Non-LIFO		Total		LIFO		Non-LIFO		Total
Raw materials	Raw materials	$	122	$	261	$	383	$	85	$	236	$	321	Raw materials	$	124	$	251	$	375	$	85	$	236	$	321
Work in process	Work in process	106		75		181		113		93		206		Work in process	110		89		199		113		93		206
Finished goods	Finished goods	448		679		1,127		451		696		1,147		Finished goods	433		683		1,116		451		696		1,147
Supplies and other	Supplies and other	—		277		277		—		271		271		Supplies and other	0		242		242		0		271		271
		676		1,292		1,968		649		1,296		1,945			667		1,265		1,932		649		1,296		1,945
Excess of FIFO or weighted-average cost over LIFO cost	Excess of FIFO or weighted-average cost over LIFO cost	(143)		—		(143)		(155)		—		(155)		Excess of FIFO or weighted-average cost over LIFO cost	(145)		0		(145)		(155)		0		(155)
Total	Total	$	533	$	1,292	$	1,825	$	494	$	1,296	$	1,790	Total	$	522	$	1,265	$	1,787	$	494	$	1,296	$	1,790

Inventories are valued at the lower of cost or net realizable value, determined on the FIFO or weighted-average cost methods, and at the lower of cost or market, determined on the LIFO cost method.

The following schedule presents a summary of property, plant and equipment, net:


		June 30, 2020		December 31, 2019			September 30, 2020		December 31, 2019
Land	Land	$	162	$	165	Land	$	164	$	165
Buildings	Buildings	2,863		2,877		Buildings	2,914		2,877
Machinery and equipment	Machinery and equipment	13,887		13,946		Machinery and equipment	14,094		13,946
Construction in progress	Construction in progress	826		851		Construction in progress	801		851
		17,738		17,839			17,973		17,839
Less accumulated depreciation	Less accumulated depreciation	(10,372)		(10,389)		Less accumulated depreciation	(10,476)		(10,389)
Total	Total	$	7,366	$	7,450	Total	$	7,497	$	7,450

Note 11. Subsequent Event - Acquisition

On October 1, 2020, we acquired Softex Indonesia, a leader in the fast-growing Indonesian personal care market, in an all-cash transaction for approximately $1.2 billion. This transaction significantly expands our presence in an important developing and emerging market and is a strong strategic fit with our core business. Softex Indonesia generated net sales of approximately $420 in 2019. We financed the transaction through a combination of short-term commercial paper, cash on hand and the issuance of a $600 bond. During the quarter ended September 30, 2020, we recorded acquisition-related costs of $9 in Marketing, research and general expenses. We will consolidate Softex into our financial statements beginning in the fourth quarter of 2020 after completing a purchase price allocation. The consolidated results for Softex Indonesia will be reported as part of our Personal Care business segment on a one-month lag.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Introduction

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:

•Overview of ~~Second~~Third Quarter 2020 Results

•Impact of COVID-19

•Results of Operations and Related Information

•Liquidity and Capital Resources

•Information Concerning Forward-Looking Statements

We describe our business outside North America in two groups – Developing and Emerging Markets ("D&E") and Developed Markets. D&E markets comprise Eastern Europe, the Middle East and Africa, Latin America and Asia-Pacific, excluding Australia and South Korea. Developed Markets consist of Western and Central Europe, Australia and South Korea. We have three reportable business segments: Personal Care, Consumer Tissue and K-C Professional. These business segments are described in greater detail in Note 79 to the unaudited interim consolidated financial statements.

This section presents a discussion and analysis of our ~~second~~third quarter 2020 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, net selling prices and product mix on net sales. Change in foreign currency exchange rates and exited businesses also impact the year-over-year change in net sales. Our analysis compares the three and ~~six~~nine months ended ~~June~~September 30, 2020 results to the same periods in 2019.

Throughout this MD&A, we refer to financial measures that have not been calculated in accordance with accounting principles generally accepted in the U.S., or GAAP, and are therefore referred to as non-GAAP financial measures. These measures include adjusted gross and operating profit, adjusted net income, adjusted earnings per share, adjusted other (income) and expense, net and adjusted effective tax rate. We believe these measures provide our investors with additional information about our underlying results and trends, as well as insight into some of the financial measures used to evaluate management.

Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for the comparable GAAP measures, and they should be read only in conjunction with our unaudited interim consolidated financial statements prepared in accordance with GAAP. There are limitations to these non-GAAP financial measures because they are not prepared in accordance with GAAP and may not be comparable to similarly titled measures of other companies due to potential differences in methods of calculation and items being excluded. We compensate for these limitations by using these non-GAAP financial measures as a supplement to the GAAP measures and by providing reconciliations of the non-GAAP and comparable GAAP financial measures.

The non-GAAP financial measures exclude the following ~~item~~items for the relevant time periods as indicated in the reconciliations included later in this MD&A:

•2018 Global Restructuring Program - In 2018, we initiated this restructuring program to reduce our structural cost base by streamlining and simplifying our manufacturing supply chain and overhead organization. See Item 1, Note 2 to the unaudited interim consolidated financial statements for details.

•Acquisition-Related Costs – One-time transaction and integration costs associated with the acquisition of Softex Indonesia. See Item 1, Note 11 to the unaudited interim consolidated financial statements for details.

Overview of ~~Second~~Third Quarter 2020 Results

•Net sales of ~~$4.6~~$4.7 billion increased ~~slightly~~1 percent compared to the year-ago period. ~~Changes~~Organic sales increased 3 percent, while changes in foreign currency exchange rates reduced sales ~~approximately 4 percent, while organic sales increased 4~~by 2 percent.

•Operating profit was ~~$925~~$666 in 2020 and ~~$670~~$915 in 2019. Net Income Attributable to Kimberly-Clark Corporation was ~~$681~~$472 in 2020 compared to ~~$485~~$671 in 2019, and diluted earnings per share were ~~$1.99~~$1.38 in 2020 compared to ~~$1.40~~$1.94 in 2019. Results in both periods include charges related to the 2018 Global Restructuring Program. Results in 2020 include acquisition-related costs associated with the acquisition of Softex Indonesia, and results in 2019 also include a gain on the sale of a manufacturing facility as part of the restructuring.

Impact of COVID-19

We continue to actively address the COVID-19 situation and its impact globally. We believe that we will emerge from these events well positioned for long-term growth, though we cannot reasonably estimate the duration and severity of this global pandemic or its ultimate impact on the global economy and our business and results.

We have experienced increased volatility in demand for some of our products as consumers adapt to the evolving environment. Beginning in the first quarter, particularly in March, demand across all business segments and major geographies increased as consumers increased home inventory levels in response to COVID-19. We expect the increase to be followed by periods of potential demand softness and volatility as consumers use existing home inventories and demand potentially returns to more normal levels. Demand for our consumer tissue products has been elevated ~~so far~~ this year as more people spend more time at home. Our K-C Professional business experienced accelerated volume declines in the ~~second~~third quarter reflecting the reduction in away from home demand.

During 2020, we have experienced temporary closures of certain facilities, though we have not experienced a material impact from a plant closure to date and our facilities have largely been exempt or partially exempt from government closure orders. At many of our facilities, we have been experiencing increased employee absences, which may continue in the current situation.

During 2020, we also experienced increased volatility in foreign currency exchange rates and commodity prices, as ~~discussed below.~~certain countries experienced increased macro-economic volatility from the COVID-19 situation.

Results of Operations and Related Information

This section presents a discussion and analysis of our ~~second~~third quarter 2020 net sales, operating profit and other information relevant to an understanding of the results of operations.

Consolidated


Selected Financial Results	Selected Financial Results	Three Months Ended June 30										Six Months Ended June 30											Selected Financial Results	Three Months Ended September 30				Nine Months Ended September 30
		2020		2019		Percent Change		2020		2019		Percent Change			2020		2019		Percent Change		2020			2019		Percent Change
Net Sales:	Net Sales:													Net Sales:
North America	North America	$	2,623	$	2,430	+8	%	$	5,224	$	4,820	+8	%	North America	$	2,562	$	2,476	+3	%	$	7,786		$	7,296	+7	%
Outside North America	Outside North America	2,052		2,235		-8	%	4,536		4,550		—	%	Outside North America	2,188		2,227		-2	%	6,724			6,777		-1	%
Intergeographic sales	Intergeographic sales	(63)		(71)		N.M.		(139)		(143)		N.M.		Intergeographic sales	(67)		(63)		N.M.		(206)			(206)		N.M.
Total Net Sales	Total Net Sales	4,612		4,594		—	%	9,621		9,227		+4	%	Total Net Sales	4,683		4,640		+1	%	14,304			13,867		+3	%
Operating Profit:	Operating Profit:													Operating Profit:
North America	North America	769		608		+26	%	1,428		1,180		+21	%	North America	626		638		-2	%	2,054			1,818		+13	%
Outside North America	Outside North America	333		260		+28	%	747		563		+33	%	Outside North America	265		292		-9	%	1,012			855		+18	%
Corporate & Other^(a)	Corporate & Other^(a)	(169)		(193)		N.M.		(324)		(409)		N.M.		Corporate & Other^(a)	(220)		(190)		N.M.		(544)			(599)		N.M.
Other (income) and expense, net^(a)	Other (income) and expense, net^(a)	8		5		+60	%	22		9		+144	%	Other (income) and expense, net^(a)	5		(175)		N.M.		27			(166)		N.M.
Total Operating Profit	Total Operating Profit	925		670		+38	%	1,829		1,325		+38	%	Total Operating Profit	666		915		-27	%	2,495			2,240		+11	%

Share of net income of equity companies	Share of net income of equity companies	35		33		+6	%	73		60		+22	%	Share of net income of equity companies	31		31		—		104			91		+14	%

Net Income Attributable to Kimberly-Clark Corporation	Net Income Attributable to Kimberly-Clark Corporation	681		485		+40	%	1,341		939		+43	%	Net Income Attributable to Kimberly-Clark Corporation	472		671		-30	%	1,813			1,610		+13	%
Diluted Earnings per Share	Diluted Earnings per Share	1.99		1.40		+42	%	3.92		2.71		+45	%	Diluted Earnings per Share	1.38		1.94		-29	%	5.30			4.65		+14	%

(a) Corporate & Other and Other (income) and expense, net include income and expense not associated with the business segments, including adjustments as indicated in the Non-GAAP Reconciliations.

N.M. - Not Meaningful

GAAP to Non-GAAP Reconciliations of Selected Financial Results


		Three Months Ended June 30, 2020														Three Months Ended September 30, 2020
		As Reported			2018 Global Restructuring Program		As Adjusted Non-GAAP				As Reported			2018 Global Restructuring Program		Softex Indonesia Acquisition-Related Costs		As Adjusted Non-GAAP
Cost of products sold	Cost of products sold	$	2,835		$	60	$	2,775		Cost of products sold	$	3,093		$	107	$	—	$	2,986
Gross Profit	Gross Profit	1,777			(60)		1,837			Gross Profit	1,590			(107)		—		1,697
Marketing, research and general expenses	Marketing, research and general expenses	844			27		817			Marketing, research and general expenses	919			25		9		885

Other (income) and expense, net										Other (income) and expense, net	5			(1)		—		6
Operating Profit	Operating Profit	925			(87)		1,012			Operating Profit	666			(131)		(9)		806

Nonoperating expense										Nonoperating expense	(40)			(26)		—		(14)
Provision for income taxes	Provision for income taxes	(199)			15		(214)			Provision for income taxes	(114)			50		—		(164)
Effective tax rate	Effective tax rate	23.2		%	—		22.7		%	Effective tax rate	20.1		%	—		—		22.4		%
Share of net income of equity companies	Share of net income of equity companies	35			(1)		36			Share of net income of equity companies	31			—		—		31
Net income attributable to noncontrolling interests	Net income attributable to noncontrolling interests	(11)			1		(12)			Net income attributable to noncontrolling interests	(11)			—		—		(11)
Net Income Attributable to Kimberly-Clark Corporation	Net Income Attributable to Kimberly-Clark Corporation	681			(72)		753			Net Income Attributable to Kimberly-Clark Corporation	472			(107)		(9)		588
Diluted Earnings per Share^(a)	Diluted Earnings per Share^(a)	1.99			(0.21)		2.20			Diluted Earnings per Share^(a)	1.38			(0.31)		(0.03)		1.72


		Three Months Ended June 30, 2019														Three Months Ended September 30, 2019
		As Reported			2018 Global Restructuring Program		As Adjusted Non-GAAP				As Reported			2018 Global Restructuring Program		As Adjusted Non-GAAP
Cost of products sold	Cost of products sold	$	3,108		$	102	$	3,006		Cost of products sold	$	3,085		$	104	$	2,981
Gross Profit	Gross Profit	1,486			(102)		1,588			Gross Profit	1,555			(104)		1,659
Marketing, research and general expenses	Marketing, research and general expenses	811			17		794			Marketing, research and general expenses	815			21		794

Other (income) and expense, net										Other (income) and expense, net	(175)			(181)		6
Operating Profit	Operating Profit	670			(119)		789			Operating Profit	915			56		859

Provision for income taxes	Provision for income taxes	(132)			27		(159)			Provision for income taxes	(192)			(23)		(169)
Effective tax rate	Effective tax rate	22.2		%	—		22.3		%	Effective tax rate	22.8		%	—		21.5		%

Net Income Attributable to Kimberly-Clark Corporation	Net Income Attributable to Kimberly-Clark Corporation	485			(92)		577			Net Income Attributable to Kimberly-Clark Corporation	671			33		638
Diluted Earnings per Share^(a)	Diluted Earnings per Share^(a)	1.40			(0.27)		1.67			Diluted Earnings per Share^(a)	1.94			0.10		1.84


		Six Months Ended June 30, 2020														Nine Months Ended September 30, 2020
		As Reported			2018 Global Restructuring Program		As Adjusted Non-GAAP				As Reported			2018 Global Restructuring Program		Softex Indonesia Acquisition-Related Costs		As Adjusted Non-GAAP
Cost of products sold	Cost of products sold	$	6,053		$	130	$	5,923		Cost of products sold	$	9,146		$	237	$	—	$	8,909
Gross Profit	Gross Profit	3,568			(130)		3,698			Gross Profit	5,158			(237)		—		5,395
Marketing, research and general expenses	Marketing, research and general expenses	1,717			50		1,667			Marketing, research and general expenses	2,636			75		9		2,552

Other (income) and expense, net										Other (income) and expense, net	27			(1)		—		28
Operating Profit	Operating Profit	1,829			(180)		2,009			Operating Profit	2,495			(311)		(9)		2,815

Nonoperating expense										Nonoperating expense	(57)			(26)		—		(31)
Provision for income taxes	Provision for income taxes	(396)			33		(429)			Provision for income taxes	(510)			83		—		(593)
Effective tax rate	Effective tax rate	23.4		%	—		22.9		%	Effective tax rate	22.6		%	—		—		22.8		%
Share of net income of equity companies	Share of net income of equity companies	73			(1)		74			Share of net income of equity companies	104			(1)		—		105
Net income attributable to noncontrolling interests	Net income attributable to noncontrolling interests	(26)			2		(28)			Net income attributable to noncontrolling interests	(37)			2		—		(39)
Net Income Attributable to Kimberly-Clark Corporation	Net Income Attributable to Kimberly-Clark Corporation	1,341			(146)		1,487			Net Income Attributable to Kimberly-Clark Corporation	1,813			(253)		(9)		2,075
Diluted Earnings per Share^(a)	Diluted Earnings per Share^(a)	3.92			(0.43)		4.34			Diluted Earnings per Share^(a)	5.30			(0.74)		(0.03)		6.06


		Six Months Ended June 30, 2019														Nine Months Ended September 30, 2019
		As Reported			2018 Global Restructuring Program		As Adjusted Non-GAAP				As Reported			2018 Global Restructuring Program		As Adjusted Non-GAAP
Cost of products sold	Cost of products sold	$	6,313		$	227	$	6,086		Cost of products sold	$	9,398		$	331	$	9,067
Gross Profit	Gross Profit	2,914			(227)		3,141			Gross Profit	4,469			(331)		4,800
Marketing, research and general expenses	Marketing, research and general expenses	1,580			45		1,535			Marketing, research and general expenses	2,395			66		2,329
Other (income) and expense, net	Other (income) and expense, net	9			(1)		10			Other (income) and expense, net	(166)			(182)		16
Operating Profit	Operating Profit	1,325			(271)		1,596			Operating Profit	2,240			(215)		2,455

Provision for income taxes	Provision for income taxes	(275)			58		(333)			Provision for income taxes	(467)			35		(502)
Effective tax rate	Effective tax rate	23.4		%	—		23.0		%	Effective tax rate	23.2		%	—		22.5		%
Share of net income of equity companies	Share of net income of equity companies	60			(2)		62			Share of net income of equity companies	91			(2)		93
Net income attributable to noncontrolling interests	Net income attributable to noncontrolling interests	(22)			1		(23)			Net income attributable to noncontrolling interests	(31)			1		(32)
Net Income Attributable to Kimberly-Clark Corporation	Net Income Attributable to Kimberly-Clark Corporation	939			(214)		1,153			Net Income Attributable to Kimberly-Clark Corporation	1,610			(181)		1,791
Diluted Earnings per Share^(a)	Diluted Earnings per Share^(a)	2.71			(0.62)		3.33			Diluted Earnings per Share^(a)	4.65			(0.52)		5.18

(a) "As Adjusted Non-GAAP" may not equal "As Reported" plus "Adjustments" as a result of rounding.

Analysis of Consolidated Results


Net Sales	Net Sales	Percent Change			Adjusted Operating Profit	Percent Change				Net Sales	Percent Change			Adjusted Operating Profit	Percent Change
		Three Months Ended June 30	Six Months Ended June 30		Three Months Ended June 30	Six Months Ended June 30		Three Months Ended September 30	Nine Months Ended September 30			Three Months Ended September 30	Nine Months Ended September 30
Volume	Volume	2	5	Volume	8	13	Volume	2	4		Volume	3	10
Net Price	Net Price	1	1	Net Price	7	6	Net Price	1	1		Net Price	3	5
Mix/Other	Mix/Other	1	1	Input Costs	10	12	Mix/Other	1	1		Input Costs	3	9
Currency	Currency	(4)	(3)	Cost Savings^(c)	22	19	Currency	(2)	(3)		Cost Savings^(c)	16	18
Total^(a)	Total^(a)	—	4	Currency Translation	(2)	(2)	Total^(a)	1	3		Currency Translation	(1)	(2)
				Other^(d)	(17)	(22)					Other^(d)	(30)	(25)
Organic^(b)	Organic^(b)	4	7	Total	28	26	Organic^(b)	3	6		Total	(6)	15

(a) Total may not equal the sum of volume, net price, mix/other and currency due to rounding.

(b) Combined impact of changes in volume, net price and mix/other.

(d) Includes impact of changes in product mix, marketing, research and general expenses, foreign currency transaction effects and other manufacturing costs.

Net sales in the ~~second~~third quarter of ~~$4.6~~$4.7 billion increased ~~slightly~~1 percent compared to the year-ago period. ~~Changes~~Organic sales increased 3 percent, while changes in foreign currency exchange rates reduced sales ~~approximately 4 percent, while organic sales increased 4~~by 2 percent. Volumes increased 2 percent and the combined impact of changes in net selling prices and product mix ~~each~~ increased sales by 1 percent. In North America, organic sales increased 128 percent in consumer products but fell 315 percent in K-C Professional. Outside North America, organic sales rose ~~3 percent in developed markets but fell 3~~2 percent in D&E markets ~~driven by Latin America.~~and 3 percent in developed markets.

Operating profit in the ~~second~~third quarter was ~~$925~~$666 in 2020 and ~~$670~~$915 in 2019. Results in both periods include charges related to the 2018 Global Restructuring Program. ~~Second~~Results in 2020 include acquisition-related costs associated with the acquisition of Softex Indonesia, and results in 2019 also include a gain on the sale of a manufacturing facility as part of the restructuring. Third quarter adjusted operating profit was ~~$1,012~~$806 in 2020 and ~~$789~~$859 in 2019. Results benefited from organic sales growth, ~~$120~~$125 of cost savings from our FORCE program and ~~$55~~$15 of cost savings from the 2018 Global Restructuring Program. Input costs decreased ~~$80,~~$25, driven by pulp ~~while~~and other raw materials. Other manufacturing costs ~~rose year-on-year.~~increased year-on-year, including costs related to COVID-19. Advertising spending increased significantly and general and administrative costs were also higher, ~~compared to the prior year.~~including capability-building investments and increased incentive compensation expense. Foreign currency translation effects reduced operating profit by ~~$15~~$10 and transaction effects also negatively impacted the comparison.

The ~~second~~third quarter effective tax rate was ~~23.2~~20.1 percent in 2020 and ~~22.2~~22.8 percent in 2019. The ~~second~~third quarter adjusted effective tax rate was ~~22.7~~22.4 percent in 2020 and ~~22.3~~21.5 percent in 2019.

Our share of net income of equity companies in the ~~second~~third quarter was ~~$35~~$31 in both 2020 and ~~$33 in~~ 2019. ~~The results benefited from organic sales growth and lower input costs, partially offset by negative foreign currency effects.~~

Diluted net income per share for the ~~second~~third quarter of 2020 was ~~$1.99~~$1.38 in 2020 and ~~$1.40~~$1.94 in 2019. ~~Second~~Third quarter adjusted earnings per share were ~~$2.20~~$1.72 in 2020, ~~an increase~~a decrease of 327 percent compared to ~~$1.67~~$1.84 in 2019.

Year-to-date net sales of ~~$9.6~~$14.3 billion increased 43 percent compared to the year ago period. Organic sales increased 76 percent, as volumes rose 54 percent and changes in net selling prices and product mix each increased sales by 1 percent. Changes in foreign currency exchange rates reduced sales by 3 percent and business exits in conjunction with the 2018 Global Restructuring Program reduced sales slightly. Year-to-date operating profit was ~~$1,829~~$2,495 in 2020 and ~~$1,325~~$2,240 in 2019. Results in both periods include charges related to the 2018 Global Restructuring Program. Results in 2020 include acquisition-related costs associated with the acquisition of Softex Indonesia, and results in 2019 also include a gain on the sale of a manufacturing facility as part of the restructuring. Year-to-date adjusted operating profit was ~~$2,009~~$2,815 in 2020 and ~~$1,596~~$2,455 in 2019. Results benefited from organic sales growth, ~~$220~~$345 of FORCE cost savings and ~~$80~~$95 of cost savings from the 2018 Global Restructuring Program. Input costs decreased ~~$195,~~$215, driven by pulp. The comparison was impacted by other manufacturing cost increases, unfavorable foreign currency effects, ~~other manufacturing cost increases, increased advertising spending and~~ higher general and administrative ~~costs.~~costs and increased advertising spending. Through ~~six~~nine months, diluted net income per share was ~~$3.92~~$5.30 in 2020 and ~~$2.71~~$4.65 in 2019. Year-to-date adjusted earnings per share were ~~$4.34~~$6.06 in 2020 and ~~$3.33~~$5.18 in 2019.

Results by Business Segments

Personal Care


		Three Months Ended June 30						Six Months Ended June 30							Three Months Ended June 30							Six Months Ended June 30							Three Months Ended September 30					Nine Months Ended September 30					Three Months Ended September 30		Nine Months Ended September 30
		2020		2019		2020		2019			2020		2019		2020		2019			2020			2019		2020		2019			2020		2019		2020		2019
Net Sales	Net Sales	$	2,229	$	2,286	$	4,651	$	4,561	Operating Profit	$	519	$	485	$	1,046	$	969	Net Sales	$	2,339		$	2,305	$	6,990	$	6,866	Operating Profit	$	486	$	490	$	1,532	$	1,459

Net Sales	Net Sales	Percent Change						Percent Change					Operating Profit		Percent Change							Percent Change						Net Sales	Percent Change					Percent Change				Operating Profit	Percent Change		Percent Change
Volume	Volume			—				4		Volume			3				8		Volume				4				4		Volume			7				8
Net Price	Net Price					—				1	Net Price						1					3		Net Price					—			—		Net Price				(1)		2
Mix/Other	Mix/Other					2				2	Input Costs						4					3		Mix/Other					1			2		Input Costs				3		3
Currency	Currency					(5)				(4)	Cost Savings^(c)						15					14		Currency					(4)			(4)		Cost Savings^(c)				14		14
Total^(a)	Total^(a)					(2)				2	Currency Translation						(2)					(2)		Total^(a)					1			2		Currency Translation				(2)		(2)
											Other^(d)						(14)					(18)												Other^(d)				(22)		(20)
Organic^(b)	Organic^(b)					2				6	Total						7					8		Organic^(b)					5			6		Total				(1)		5

(a) Total may not equal the sum of volume, net price, mix/other and currency due to rounding.

(b) Combined impact of changes in volume, net price and mix/other.

(d) Includes impact of changes in product mix, marketing, research and general expenses, foreign currency transaction effects and other manufacturing costs.

~~Second~~Third quarter net sales in North America increased 46 percent. Volumes increased 25 percent, ~~and changes in product mix and net selling prices increased sales by 2 percent and 1 percent, respectively. The improved volumes and product mix were~~ driven by baby and child ~~care.~~

~~Net sales in D&E markets decreased 9 percent. Changes in foreign currency exchange rates reduced sales 11 percent. Changes in product mix improved sales by 2 percent~~care, and ~~volumes rose slightly, while changes in net selling prices decreased sales by 1 percent.~~

~~Net sales in developed markets outside North America decreased 8 percent. Changes in foreign currency exchange rates reduced sales by 5 percent. Volumes fell 6 percent, while~~ the combined impact of changes in net selling prices and product mix increased sales by 1 percent.

Net sales in D&E markets decreased 4 percent. Changes in foreign currency exchange rates reduced sales by 11 percent. Volumes rose 5 percent, including increases in China, Eastern Europe, India and Latin America, and changes in product mix increased sales by more than 1 percent.

Net sales in developed markets outside North America increased 1 percent. Changes in foreign currency exchange rates increased sales by 2 percent. Changes in net selling prices decreased sales by 3 percent while changes in product mix increased sales by 2 percent.

Operating profit of ~~$519 increased 7~~$486 decreased 1 percent. Results were impacted by unfavorable foreign currency effects, higher advertising spending, other manufacturing cost increases and higher general and administrative costs. The comparison benefited from organic sales growth, cost savings and lower input costs. ~~Results were impacted by unfavorable foreign currency effects, other manufacturing cost increases, higher advertising spending and increased general and administrative costs.~~

Consumer Tissue


		Three Months Ended June 30						Six Months Ended June 30							Three Months Ended June 30							Six Months Ended June 30							Three Months Ended September 30					Nine Months Ended September 30					Three Months Ended September 30		Nine Months Ended September 30
		2020		2019		2020		2019			2020		2019		2020		2019			2020			2019		2020		2019			2020		2019		2020		2019
Net Sales	Net Sales	$	1,645	$	1,472	$	3,368	$	2,998	Operating Profit	$	428	$	221	$	793	$	462	Net Sales	$	1,623		$	1,484	$	4,991	$	4,482	Operating Profit	$	318	$	264	$	1,111	$	726

Net Sales	Net Sales	Percent Change						Percent Change					Operating Profit		Percent Change							Percent Change						Net Sales	Percent Change					Percent Change				Operating Profit	Percent Change		Percent Change
Volume	Volume			14				14		Volume			41				33		Volume				10				13		Volume			24				30
Net Price	Net Price					1				1	Net Price						9					7		Net Price					—			1		Net Price				3		6
Mix/Other	Mix/Other					(1)				—	Input Costs						27					30		Mix/Other					(1)			(1)		Input Costs				5		21

Currency	Currency					(3)				(2)	Cost Savings^(c)						33					26		Currency					—			(2)		Cost Savings^(c)				18		23
Total^(a)	Total^(a)					12				12	Currency Translation						(2)					(1)		Total^(a)					9			11		Currency Translation				—		(1)
											Other^(d)						(14)					(23)												Other^(d)				(30)		(26)
Organic^(b)	Organic^(b)					14				14	Total						94					72		Organic^(b)					10			13		Total				20		53

(a) Total may not equal the sum of volume, net price, mix/other and currency due to rounding.

(b) Combined impact of changes in volume, net price and mix/other.

(d) Includes impact of changes in marketing, research and general expenses, foreign currency transaction effects and other manufacturing costs.

~~Second~~Third quarter net sales in North America increased 2211 percent. Volumes rose 2411 percent and changes in net selling prices ~~improved~~increased sales by 12 percent, while changes in product mix decreased sales by 2 percent. Volumes increased ~~double-digits~~high-single digits to low-double digits in all major product categories. The volume increase was driven by increased shipments to support higher consumer and customer demand related to the global outbreak of ~~COVID-19, including the significant increase in the number of people working from home.~~COVID-19.

Net sales in D&E markets decreased 94 percent including a 7 percent negative impact from changes in foreign currency exchange rates. Volumes ~~decreased~~increased 3 percent and changes in product mix increased sales by 2 percent, ~~and~~while changes in net selling prices decreased sales by ~~1 percent, while changes in product mix increased sales by 1~~2 percent.

Net sales in developed markets outside North America increased 817 percent. Volumes rose 714 percent, driven by South Korea and Western/Central Europe. The volume increase was driven by increased shipments to support higher consumer and customer demand related to the global outbreak of COVID-19. Changes in ~~net selling prices and product mix~~foreign currency exchange rates increased sales by 4 percent, ~~and 1 percent, respectively. Changes~~while changes in ~~foreign currency exchange rates reduced~~net selling prices decreased sales by 41 percent.

Operating profit of ~~$428~~$318 increased 9420 percent. Results benefited from organic sales growth, cost savings and lower input costs. The comparison was impacted by increased advertising spending, other manufacturing cost increases, higher general and administrative costs and unfavorable foreign currency effects.

K-C Professional


		Three Months Ended June 30						Six Months Ended June 30									Three Months Ended June 30									Six Months Ended June 30												Three Months Ended September 30					Nine Months Ended September 30							Three Months Ended September 30		Nine Months Ended September 30
		2020		2019		2020		2019			2020			2019			2020			2019				2020			2019				2020			2019						2020	2019		2020		2019
Net Sales	Net Sales	$	724	$	821	$	1,572	$	1,638	Operating Profit		$	155		$	162		$	336		$	312	Net Sales		$	705			$	839		$	2,277			$	2,477		Operating Profit		$	87	$	176	$	423	$	488

Net Sales	Net Sales	Percent Change						Percent Change						Operating Profit			Percent Change									Percent Change									Net Sales			Percent Change					Percent Change						Operating Profit	Percent Change		Percent Change
Volume	Volume			(16)				(6)		Volume				(24)						(9)	Volume						(21)							(11)				Volume			(41)				(20)
Net Price	Net Price					4				3	Net Price									18						14		Net Price						3						3	Net Price						13			14
Mix/Other	Mix/Other					3				2	Input Costs									2						8		Mix/Other						3						2	Input Costs						(4)			3
Exited Businesses^(e)						—				(1)	Cost Savings^(c)									16						14
Currency	Currency					(2)				(2)	Currency Translation									(2)						(2)		Currency						—						(1)	Cost Savings^(c)						11			13
Total^(a)	Total^(a)					(12)				(4)	Other^(d)									(14)						(17)		Total^(a)						(16)						(8)	Currency Translation						—			(1)
																																						Other^(d)					(30)				(22)
Organic^(b)	Organic^(b)					(10)				(1)	Total									(4)						8		Organic^(b)										(15)			(6)		Total						(51)		(13)

(a) Total may not equal the sum of volume, net price, mix/other, exited businesses and currency due to rounding.

(b) Combined impact of changes in volume, net price and mix/other.

(d) Includes impact of changes in product mix, marketing, research and general expenses, foreign currency transaction effects and other manufacturing costs.

~~(e) Exited businesses in conjunction with the 2018 Global Restructuring Program.~~

~~Second~~Third quarter net sales in North America decreased 315 percent. Volumes decreased 921 percent, ~~as double-digit declines~~reflecting the reduction in demand for away from home products related to the global outbreak of COVID-19, with sales down significantly in washroom ~~and safety~~ products ~~were partially offset by double-digit increases~~but up double-digits in wipers, safety and other products. Changes in net selling prices and product mix each increased sales by ~~4 percent and~~ 3 ~~percent, respectively.~~percent.

Net sales in D&E markets decreased 3528 percent including a 5 percent negative impact from changes in foreign currency exchange rates. Volumes fell 3224 percent, reflecting the reduction in demand for away from home products related to the global outbreak of COVID-19, with significant declines in all major ~~geographies, and changes~~geographies. Changes in product mix decreased sales by 12 percent. ~~Changes~~, while changes in net selling prices increased sales by 3 percent.

Net sales in developed markets outside North America decreased 128 percent. Volumes decreased 1718 percent, reflecting the reduction in demand for away from home products related to the global outbreak of COVID-19, while changes in product mix and net selling prices increased sales by 54 percent and 3 percent, respectively. ~~The changes were driven by Western/Central Europe.~~ Changes in foreign currency exchange rates ~~decreased~~increased sales by 43 percent.

Operating profit of ~~$155~~$87 decreased 451 percent. The comparison was impacted by lower ~~volumes,~~organic sales, other manufacturing cost increases including inefficiencies from lower production volumes and ~~unfavorable currency effects.~~higher input costs. Results benefited from ~~increased net selling prices, improved product mix and~~ cost savings.

2018 Global Restructuring Program

As a result of the outbreak of COVID-19 and the related uncertainty and complexity of the environment, consistent with our Form 10-Q filed on April 22, 2020, we expect that some restructuring activity and the related charges will extend into 2021 rather than being completed at the end of 2020 as previously planned. Total restructuring charges to implement the program are expected to be toward the high end of the range of $1.7 billion to $1.9 billion pre-tax ($1.3 billion to $1.4 billion after tax). We continue to expect the program will generate annual pre-tax cost savings of $500 to $550. We target to achieve those savings by the end of 2021, although it is possible the full realization could occur in 2022 because of the uncertainties related to COVID-19. Savings for the first ~~six~~nine months of 2020 were ~~$80,~~$95, bringing cumulative savings to ~~$380.~~$395. See Item 1, Note 2 to the unaudited interim consolidated financial statements for additional information.

Subsequent Event - Acquisition

On October 1 2020, we acquired Softex Indonesia, a leader in the fast-growing Indonesian personal care market, in an all-cash transaction for approximately $1.2 billion. This transaction significantly expands our presence in an important developing and emerging market and is a strong strategic fit with our core business. Softex Indonesia generated net sales of approximately $420 in 2019. We financed the transaction through a combination of short-term commercial paper, cash on hand, and the issuance of a $600 bond. See Item 1, Note 11 to the unaudited interim consolidated financial statements for additional information.

Liquidity and Capital Resources

Cash Provided by Operations

Cash provided by operations was ~~$2,283~~$2.8 billion for the first ~~six~~nine months of 2020 compared to ~~$926~~$1.8 billion in the prior year. The increase was driven by improved working capital and higher ~~earnings and the timing of tax payments.~~

earnings.

Investing

During the ~~six~~nine months ended ~~June~~September 30, 2020, our capital spending was ~~$636~~$894 compared to ~~$569~~$867 in the prior year. We anticipate that full year capital spending will be $1.2 billion to $1.3 billion. Proceeds from disposition of property in 2019 include approximately $200 from the previously mentioned sale of a manufacturing facility in the third quarter as part of the 2018 Global Restructuring Program.

Financing

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 ~~$93~~$260 as of ~~June~~September 30, 2020 (included in Debt payable within one year on the consolidated balance sheet). The average month-end balance of short-term debt for the ~~second~~third quarter of 2020 was ~~$112.~~$156. These short-term borrowings provide supplemental funding for supporting 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.

At ~~June~~September 30, 2020 and December 31, 2019, total debt was ~~$8.1~~$8.4 billion and $7.7 billion, respectively.

In ~~February~~September 2020, we issued ~~$500~~$600 aggregate principal amount of ~~2.875%~~1.05% notes due ~~February 7, 2050.~~September 15, 2027. Proceeds from the offering together with cash on hand and borrowings under our commercial paper program were used to fund the acquisition of Softex Indonesia.

In March 2020, we issued $750 aggregate principal amount of 3.10% notes due March 26, 2030. Proceeds from the offering were used for general corporate purposes including the repayment of a portion of our commercial paper indebtedness.

In ~~March~~February 2020, we issued ~~$750~~$500 aggregate principal amount of ~~3.10%~~2.875% notes due ~~March 26, 2030.~~February 7, 2050. Proceeds from the offering were used for general corporate purposes including the repayment of a portion of our commercial paper indebtedness.

We maintain a $2.0 billion revolving credit facility which expires in June 2023 and a $750 revolving credit facility which expires in June 2021. These facilities, currently unused, support our commercial paper program, and would provide liquidity in the event our access to the commercial paper markets is unavailable for any reason.

In July 2017, the United Kingdom's Financial Conduct Authority, which regulates the London Interbank Offered Rate (LIBOR), announced that it intends to phase out LIBOR by the end of 2021. We are currently evaluating the potential effect of the eventual replacement of the LIBOR, but we do not expect the effect to be material. Accounting guidance has been recently issued to ease the transition to alternative reference rates from a financial reporting perspective. See Item 1, Note 1 to the unaudited interim consolidated financial statements for details.

We repurchase shares of Kimberly-Clark common stock from time to time pursuant to publicly announced share repurchase programs. During the first ~~six~~nine months of 2020, we repurchased ~~1.9~~3.2 million shares of our common stock at a cost of ~~$263~~$457 through a broker in the open market. We ~~temporarily suspended~~expect our ~~share repurchase program effective April 24, 2020 to enhance flexibility in the current environment, but we~~full-year repurchases will be ~~restarting our share repurchase program effective July 24, 2020 with full year share repurchases anticipated to be in the range of $700 to $900.~~$700.

K-C Argentina began accounting for their operations as highly inflationary effective July 1, 2018, as required by GAAP. Under highly inflationary accounting, K-C Argentina’s functional currency became the U.S. dollar, and its income statement and balance sheet have been measured in U.S. dollars using both current and historical rates of exchange. The effect of changes in exchange rates on peso-denominated monetary assets and liabilities has been reflected in earnings in Other (income) and expense, net and was not material. As of ~~June~~September 30, 2020, K-C Argentina had a small net peso monetary position. Net sales of K-C Argentina were approximately 1 percent of our consolidated net sales for the three and ~~six~~nine months ended ~~June~~September 30, 2020.

We believe that our ability to generate cash from operations and our capacity to issue short-term and long-term debt are adequate to fund working capital, payments for our 2018 Global Restructuring Program, capital spending, pension contributions, dividends and other needs for the foreseeable future. Further, we do not expect restrictions or taxes on repatriation of cash held outside of the U.S. to have a material effect on our overall business, liquidity, financial condition or results of operations for the foreseeable future.

Information Concerning Forward-Looking Statements

Certain matters contained in this report concerning the business outlook, including the anticipated cost savings from our FORCE program, costs and savings from the 2018 Global Restructuring Program, cash flow and uses of cash, growth initiatives, innovations, marketing and other spending, net sales, anticipated currency rates and exchange risks, including the impact in Argentina, raw material, energy and other input costs, effective tax rate, contingencies and anticipated transactions of Kimberly-Clark, including dividends, share repurchases and pension contributions, constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and are based upon management's expectations and beliefs concerning future events impacting Kimberly-Clark. There can be no assurance that these future events will occur as anticipated or that our results will be as estimated. Forward-looking statements speak only as of the date they were made, and we undertake no obligation to publicly update them.

The assumptions used as a basis for the forward-looking statements include many estimates that, among other things, depend on the achievement of future cost savings and projected volume increases. In addition, many factors outside our control, including pandemics (including the ongoing COVID-19 outbreak), epidemics, failure to realize the expected benefits or synergies from the Softex Indonesia acquisition, fluctuations in foreign currency exchange rates, the prices and availability of our raw materials, potential competitive pressures on selling prices for our products, energy costs, our ability to maintain key customer relationships and retail trade customer actions, as well as general economic and political conditions globally and in the markets in which we do business, could affect the realization of these estimates.

For a description of certain factors that could cause our future results to differ from those expressed in these forward-looking statements, see Item 1A entitled "Risk Factors" in each of our Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 and our Annual Report on Form 10-K for the year ended December 31, 2019. Other factors not presently known to us or that we presently consider immaterial could also affect our business operations and financial results.

Item 4. Controls and Procedures

As of ~~June~~September 30, 2020, an evaluation was performed under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on that evaluation, management, including the Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were effective as of ~~June~~September 30, 2020. There were no changes in our internal control over financial reporting during the quarter covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

See Part I, Item 1, Note 8 to the unaudited interim consolidated financial statements, which is incorporated in this Item 1 by reference.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

We repurchase shares of Kimberly-Clark common stock from time to time pursuant to publicly announced share repurchase programs. All our share repurchases during the ~~second~~third quarter of 2020 were made through a broker in the open market.

The following table contains information for shares repurchased during the ~~second~~third quarter of 2020. None of the shares in this table were repurchased directly from any of our officers or directors.

Period (2020)
Total Number
of Shares
Purchased^(a)
Average
Price Paid
Per Share Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
or Programs Maximum Number
of Shares That May
Yet Be Purchased
Under the Plans or
Programs
April 1 to April 30 299,900 $ 130.49 32,299,728 7,700,272
May 1 to May 31 — — 32,299,728 7,700,272
June 1 to June 30 — — 32,299,728 7,700,272
Total 299,900


Period (2020)	Total Number of Shares Purchased^(a)	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares That May Yet Be Purchased Under the Plans or Programs
July 1 to July 31	162,100	$	149.85	32,461,828	7,538,172
August 1 to August 31	541,200	156.80		33,003,028	6,996,972
September 1 to September 30	570,700	148.83		33,573,728	6,426,272
Total	1,274,000

(a)Share repurchases were made pursuant to a share repurchase program authorized by our Board of Directors on November 13, 2014. This program allows for the repurchase of 40 million shares in an amount not to exceed $5 billion.

Item 6. Exhibits

(a)Exhibits

Exhibit No. (3)a. Amended and Restated Certificate of Incorporation, dated April 30, 2009, incorporated by reference to Exhibit No. (3)a of the Corporation's Current Report on Form 8-K filed on May 1, 2009.

Exhibit No. (3)b. By-Laws, as amended May 2, 2019, incorporated by reference to Exhibit No. (3)b of the Corporation's Current Report on Form 8-K filed on May 3, 2019.

Exhibit No. (4). Copies of instruments defining the rights of holders of long-term debt will be furnished to the Securities and Exchange Commission on request.

Exhibit No. (10)n.b . Form of ~~Award Agreements under 2011 Equity Participation Plan for Nonqualified Stock Options, filed herewith.~~Executiv

e Severance Agreement , incorporated by reference to Exhibit No. (10)r.b of the Corporation's Current Report on Form ~~of Award Agreements under 2011 Equity Participation Plan for Time-Vested Restricted Stock Units,~~8-K filed ~~herewith.~~September 16, 2020.

Exhibit No. (31)a. Certification of Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), filed herewith.

Exhibit No. (31)b. Certification of Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), filed herewith.

Exhibit No. (32)a. Certification of Chief Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United States Code, furnished herewith.

Exhibit No. (32)b. Certification of Chief Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United States Code, furnished herewith.

Exhibit No. (101).INS XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document

Exhibit No. (101).SCH XBRL Taxonomy Extension Schema Document

Exhibit No. (101).CAL XBRL Taxonomy Extension Calculation Linkbase Document

Exhibit No. (101).DEF XBRL Taxonomy Extension Definition Linkbase Document

Exhibit No. (101).LAB XBRL Taxonomy Extension Label Linkbase Document

Exhibit No. (101).PRE XBRL Taxonomy Extension Presentation Linkbase Document

Exhibit No. 104 The cover page from this Current Report on Form 10-Q formated as Inline XBRL

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



						KIMBERLY-CLARK CORPORATION
						(Registrant)







By:						/s/ Andrew S. Drexler
						Andrew S. Drexler
						Vice President and Controller
						(principal accounting officer)

~~July 23,~~October 22, 2020