Kimberly-Clark, Dallas, has operations in Chester that produces Scott toilet tissue and Scott paper towels.
Net income fell to $432 million, or $1.09 per share. That was down from $469 million, or $1.14 per share, last year. Adjusted earnings of $1.26 per share were in line with expectations of analysts polled by FactSet.
But revenue was a bright spot, rising 8 percent to $5.38 billion. That beat analysts' expectations for $5.29 billion.
The revenue jump was helped by higher prices. Like many companies, Kimberly-Clark has been raising prices to deal with its own higher costs. In North America, sales of baby wipes and feminine care products increased, though sales of some other baby care and child care products suffered as customers traded down to cheaper brands or competitors offered heavy discounts.
The unit that sells toilet paper, paper towels and other products to offices and hotels saw sales of washroom products hold steady, which the company blamed on high office vacancy rates. Sales of safety products, such as helmets and goggles, and medical products, such as exam gloves, did well.
The revenue jump was also helped by currency exchange translation: When the dollar is weak, goods sold overseas translate into more dollars in the U.S. However, Kimberly-Clark said it expects this benefit to soften as some foreign currencies, such as the Mexican peso, weaken.
Higher materials costs pushed the cost of making products up 13 percent. However, Kimberly-Clark also said it is seeing some of those costs level off. For example, it now expects northern softwood pulp to cost an average of $980 to $985 per metric ton for the year, down from its previous estimate of $1,000 to $1,020. It expects oil to cost an average of $91 to $94 per barrel for 2011, down from its previous estimate of $100 to $105.
Overall, it expects cost inflation to make a dent of $575 to $625 million for the year, down from previous assumptions of $650 to $750 million.
But other predictions for the year were less cheery. The company expects an overall revenue increase of 4 to 6 percent, down from previous predictions of 5 to 7 percent. It expects per-share earnings of $4.80 to $4.90 after adjusting for one-time expenses. Previously, it had said that earnings were expected to be in the lower half of a range from $4.80 to $5.05.
Shares of Kimberly-Clark were down $3.09 (4.23 percent) to $69.91 soon after market trading opened Monday.
