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Kimberly-Clark CEO to step down next year, results beat estimates

Key Points
  • Kimberly-Clark's CEO Thomas Falk will step down as CEO on Jan. 1, 2019, and will become the executive chairman.
  • The Huggies diaper maker said it would keep its organic sales growth and earnings forecast for the year intact.
Boxes of Huggies brand diapers move along a conveyor belt at the Kimberly-Clark manufacturing facility in Paris, Texas.
Laura Buckman | Bloomberg | Getty Images

Kimberly-Clark reported better-than-expected quarterly results on Monday, and said long-time Chief Executive Officer Thomas Falk would step down and be succeeded by Chief Operating Officer Michael Hsu next year.

The Huggies diaper maker also said it would keep its organic sales growth and earnings forecast for the year intact, sending its shares up 3 percent in early trading.

Falk, 60, will step down as CEO on Jan. 1, 2019, and will become the executive chairman, the company said.

Falk, who has been CEO since Sept. 12, 2002, steered the spinoff of the company's U.S-based healthcare business in 2014, to focus on its core brands such as Huggies and Kleenex tissues.

During his tenure, the company's annual sales have risen 38 percent, while the stock has nearly doubled.

But like other U.S. packaged goods makers, Kimberly-Clark is also plagued by surging commodities and transportation costs in recent times.

The industry is also being rocked by changing consumer habits and pricing pressure due to the rise of online sales. Kimberly's stock is down about 9 percent this year.

Hsu, 54, who has been chief operating officer since 2017, oversaw the company's $8 billion North America personal care and consumer tissue business, its biggest unit.

Before joining Kimberly-Clark, Hsu also worked at Kraft Foods and H.J. Heinz, the company said.

Excluding items, Kimberly-Clark earned $1.71 per share in the third quarter ended September, beating the average analyst estimate of $1.63, according to Refinitiv data.

Overall revenue slipped 1.7 percent to $4.58 billion, due to a strong dollar, but higher pricing pushed up organic revenue 1 percent.

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Health and Science

Medtronic co-founder Earl Bakken passes away

Key Points
  • Earl Bakken, creator of the first wearable external pacemaker and co-founder one of the world's largest medical device companies, Medtronic, has died at 94.
  • Bakken and his brother-in-law, Palmer Hermundslie, formed Medtronic in 1949 and turned it from a struggling company they ran out of the Hermundlie family's Minneapolis garage into a multinational medical technology powerhouse.
  • Bakken, who led the company for 40 years, was fitted for his own pacemaker in 2001 and a replacement in 2009.