(Bloomberg) -- Kimberly-Clark Corp., owner of the Scott toilet paper brand, lowered its full-year organic sales forecast after reporting weaker-than-expected results.
Organic sales, which strip out currency volatility and other items, are expected to rise 3% to 4% this year, the company said Tuesday, down from a previous forecast for a gain in the mid-single digits. Kimberly-Clark cited “headwinds from changes in retail inventory levels.”
Stores that sell Kimberly-Clark’s products have lowered their stocking levels amid high interest rates and costs for shipping and storing the merchandise. The company’s consumer tissue segment, which includes the Kleenex brand, reported lower organic sales due to lower inventories in North America.
The shares fell as much as 5.2% at the New York market open, their biggest intraday loss in four months. They had gained 19% as of Monday’s close, compared to a 23% increase in the S&P 500.
In the third quarter, revenue fell 3.5% to $5 billion, trailing analysts’ estimates. Organic sales growth of 1% also missed projections in the period and was the slowest rate in more than three years.
In July, Kimberly-Clark said that supplies for its Scott 1000 toilet paper were constrained, hurting the company’s market share in bath tissue. That has since been resolved.
Last week, Procter & Gamble Co., which makes Bounty paper towels, reported organic sales growth for its latest quarter that narrowly missed analysts’ projections.
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