Kimberly-Clark Corp. David Mizell Mary Voss 4/19/2005

Why is K-C a good company? Strong Portfolio of Brands Strong Portfolio of Brands International Growth Potential International Growth Potential Innovation/Product Improvements Innovation/Product Improvements Continuing Cost Reduction Continuing Cost Reduction Good Management and Strong Corporate Governance Good Management and Strong Corporate Governance Commitment to Environmentalism Commitment to Environmentalism

Company Overview Founded in 1872 in Neenah, WI by John A. Kimberly, Charles B. Clark and two other partners. Founded in 1872 in Neenah, WI by John A. Kimberly, Charles B. Clark and two other partners. Company Timeline Company Timeline First paper towel (Scott) invented in 1907 First paper towel (Scott) invented in 1907 Kotex pads created in 1920 Kotex pads created in 1920 Kleenex invented in 1924 Kleenex invented in 1924 Huggies developed in 1978 Huggies developed in 1978 Depends introduced in 1980 Depends introduced in 1980 Pull-Ups developed in 1989 Pull-Ups developed in 1989 Kimberly-Clark and Scott Paper Merge in 1995 Kimberly-Clark and Scott Paper Merge in 1995 Neat Sheet introduced in 2002 Neat Sheet introduced in 2002

Brands Kimberly-Clark Brands Kimberly-Clark Brands Kleenex facial tissues Kleenex facial tissues Cottonelle toilet paper Cottonelle toilet paper Scott and Viva paper towels Scott and Viva paper towels Kotex pads Kotex pads Huggies, Pull-Ups, Depends, and Poise diapers Huggies, Pull-Ups, Depends, and Poise diapers Neat Sheet Neat Sheet

Market Share Category Diapers % 38% 40% Training, Youth and Swim Pants % 68% 73% Feminine Care % 22% 23% Adult Incontinence Care % 56% 55% Baby Wipes % 41% 42% Facial Tissue % 53% 54% Bathroom Tissue % 28% 27% Paper Towels % 19% 19%

Financial Performance Total Revenue Total Revenue $13,231,500,000 in 2002 $13,231,500,000 in 2002 $14,026,300,000 in 2003 $14,026,300,000 in 2003 $15,083,200,000 in 2004 $15,083,200,000 in 2004 Basic net earnings per share Basic net earnings per share $3.24 in 2002 $3.24 in 2002 $3.34 in 2003 $3.34 in 2003 $3.64 in 2004 $3.64 in 2004 Market Cap is $31.04 B Market Cap is $31.04 B P/E Ratio is P/E Ratio is 18.04

Kimberly-Clark’s Numbers Trailing P/E: Trailing P/E: Forward P/E: Forward P/E: Profit Margin (ttm): 11.40% Profit Margin (ttm): 11.40% Operating Margin (ttm): 16.62% Operating Margin (ttm): 16.62% Return on Assets (ttm): 10.22% Return on Assets (ttm): 10.22% Return on Equity (ttm): 26.56% Return on Equity (ttm): 26.56% Beta is.85 Beta is.85

KMB 1 Year Chart

KMB 5 Year Chart

KMB 5 Year vs. S&P 500 and DJIA

Competitor Comparison Kimberly-Clark (KMB) Kimberly-Clark (KMB) Market Cap:31.04B Market Cap:31.04B Employees:60,000 Employees:60,000 Rev. Growth (ttm):5.10% Rev. Growth (ttm):5.10% Revenue (ttm):15.08B Revenue (ttm):15.08B Operating Margin (ttm):16.62% Operating Margin (ttm):16.62% Net Income (ttm):1.77B Net Income (ttm):1.77B EPS (ttm):3.574 EPS (ttm):3.574 P/E (ttm):18.04 P/E (ttm):18.04 Proctor & Gamble (PG) Proctor & Gamble (PG) Market Cap:137.73B Market Cap:137.73B Employees: 110,000 Employees: 110,000 Rev. Growth (ttm):18.5% Rev. Growth (ttm):18.5% Revenue (ttm):51.49B Revenue (ttm):51.49B Operating Margin (ttm):19.16% Operating Margin (ttm):19.16% Net Income (ttm):6.81B Net Income (ttm):6.81B EPS (ttm):2.513 EPS (ttm):2.513 P/E (ttm):21.73 P/E (ttm):21.73 Playtex Products (PYX) Market Cap:625.23M Employees:1,500 Rev. Growth (ttm):1.4% Revenue (ttm):666.90M Operating Margin (ttm):18.70% Net Income (ttm):55.51M EPS (ttm):.907 P/E (ttm):10.85

Industry Averages Market Cap: M Market Cap: M Employees: 8,100 Employees: 8,100 Revenue Growth (ttm): 7.5% Revenue Growth (ttm): 7.5% Revenue: 1.60B Revenue: 1.60B Operating Margin (ttm): 3.90% Operating Margin (ttm): 3.90% Net Income: 14.31M Net Income: 14.31M EPS:.39 EPS:.39 P/E: P/E: 16.87

KMB 1 Year vs. PG and PYX

KMB 5 Year vs. PG and PYX

Porter’s Five Forces Threat of New Entrants: Low Threat of New Entrants: Low Threat of Substitutes: High Threat of Substitutes: High Bargaining Power of Buyers: Moderate Bargaining Power of Buyers: Moderate Industry Rivalry: High Industry Rivalry: High Bargaining Power of Suppliers: Low Bargaining Power of Suppliers: Low

Financial Forecast From company guidance: From company guidance: 3-5% Revenue growth expected 3-5% Revenue growth expected Reduction of 150 million in cost each year for next couple of years Reduction of 150 million in cost each year for next couple of years Plan to repurchase 25 million shares over the next 5 years Plan to repurchase 25 million shares over the next 5 years Capital spending 5-6% of sales Capital spending 5-6% of sales Concern over rising commodity prices Concern over rising commodity prices

Financial Forecast Discounted Cash Flow Analysis returns a price of $77.40 per share Discounted Cash Flow Analysis returns a price of $77.40 per share View excel spreadsheet View excel spreadsheet

Scenario Analysis Growth Rates Growth Rates - rates at 5% : rates at 4% : rates at 4% : rates at 3% : rates at 3% : WACC WACC - WACC at 8% : WACC at 8.5% : WACC at 9% : Cost of Products Sold Cost of Products Sold - at 65.40% : 66.92

Global Growth Potential Sells products in more than 150 countries Sells products in more than 150 countries Manufacturing facilities in 37 countries Manufacturing facilities in 37 countries In K-C’s developing and emerging markets sales and operating profit rose at double-digit rates Developing and emerging markets account for less than 25 percent of sales BRICIT, where K-C has established assets and a marketplace presence: Brazil, Russia, India, China, Indonesia and Turkey. Per capita income in each of these countries is rising Using multi-tier product strategy to drive penetration and usage and to build brand loyalty

Good Management Fortune magazine named K-C among the 100 Best Companies to Work For in America in 2002 and Fortune magazine named K-C among the 100 Best Companies to Work For in America in 2002 and K-C has won several similar global awards K-C has won several similar global awards Wal-Mart recognized Kimberly-Clark with a Supplier of the Year Award in 2003 Wal-Mart recognized Kimberly-Clark with a Supplier of the Year Award in 2003 Named in 2002 to the Calvert Social Index: Named in 2002 to the Calvert Social Index: Criteria relates to workplace issues, environmental management, product safety, application of consistent high standards to international operations, respect for indigenous peoples’ rights and progressive community relations. Criteria relates to workplace issues, environmental management, product safety, application of consistent high standards to international operations, respect for indigenous peoples’ rights and progressive community relations. Kimberly-Clark was listed on the Financial Times Stock Exchange Index for Good US 100 Companies and the FTSE4GOOD Global 100 Companies Index in 2002 Kimberly-Clark was listed on the Financial Times Stock Exchange Index for Good US 100 Companies and the FTSE4GOOD Global 100 Companies Index in 2002 Kimberly-Clark was recognized in 2002 by the National Safety Council as a Charter Member for the company’s involvement in founding the organization in Kimberly-Clark was recognized in 2002 by the National Safety Council as a Charter Member for the company’s involvement in founding the organization in Thomas J. Falk,Chief Executive Officer, has worked for Kimberly-Clark since Thomas J. Falk,Chief Executive Officer, has worked for Kimberly-Clark since 1983.

Environmental Policies Protection of the Biosphere Protection of the Biosphere Periodically audits environmental performance at all locations. Periodically audits environmental performance at all locations. Sustainable Use of Natural Resources Sustainable Use of Natural Resources Recycled fiber in products and packaging and following sustained yield forestry practices Recycled fiber in products and packaging and following sustained yield forestry practices Use and Conservation of Energy Use and Conservation of Energy Establishing ongoing energy conservation programs in all locations Establishing ongoing energy conservation programs in all locations Reduction and Disposal of Wastes Reduction and Disposal of Wastes Supporting an integrated approach to solid waste management including: Supporting an integrated approach to solid waste management including: Recycling Recycling Conservative use of landfills Conservative use of landfills

Recommendation Purchase 300 Shares of KMB at the Market Purchase 300 Shares of KMB at the Market KMB closed at as of 4/18/2005 KMB closed at as of 4/18/ shares at yields an investment of $19, shares at yields an investment of $19,344.