April 28 (Reuters) – Kimberly-Clark warned on Tuesday that persistently higher oil prices could add up to $170 million in costs in the second half of the year, but kept its annual forecast unchanged as demand for its personal care products held up.
The warning echoes concerns across the consumer goods sector, with peers including Procter & Gamble also flagging rising input costs as the Middle East conflict drives up oil prices.
“If oil prices were to persist at the $100-per-barrel level for the duration of the second half, we could see additional gross input cost inflation in the range of $150 to $170 million,” Kimberly-Clark’s CFO Nelson Urdaneta said in prepared remarks.
He added that the potential impact is not reflected in the company’s current outlook, and that management is evaluating mitigation measures.
The Huggies maker said it expects a $50 million hit in the second quarter from a fire at a distribution center in California, alongside additional costs related to the conflict.
Kimberly-Clark, which is on track to close its $40 billion acquisition of Tylenol-maker Kenvue in the second half of 2026, weathered a demand slowdown and intense competition thanks to volume growth from new product launches and a broader range of affordable offerings.
The company expects fiscal 2026 organic sales growth to be in line to ahead of the weighted average growth in the categories and markets it competes in, which for the latest 12 months grew at about 2.5%. It also maintained its adjusted profit forecast.
Shares of the company were up about 1% premarket as it beat first-quarter sales estimates.
It posted sales of $4.16 billion, surpassing estimates of $4.09 billion, according to data compiled by LSEG.
On an adjusted basis, it earned a profit of $1.60 per share, compared with $1.62 a year ago, pressured by price cuts and investments in product innovations.
(Reporting by Anuja Bharat Mistry in Bengaluru and Alexander Marrow in London; Editing by Shilpi Majumdar and Devika Syamnath)
