Kimberly-Clark 2007 Annual Report Download - page 120

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Additional Information—(Continued)
•Income from Discontinued Operations.In November 2004, the Corporation spun off our Neenah pulp
and paper operations (“NPI”). Accordingly, the results of operations of NPI were reclassified to Income
from Discontinued Operations. Management also excludes the earnings of NPI when evaluating
operating performance of the Corporation.
•European Legal Judgment. In the first quarter of 2003, the Corporation recorded a pretax charge of
about $16 million, or 2 cents per share, as a result of a legal judgment related to a 1987 European
government grant to a facility that was sold in 1998. Management excludes this charge when evaluating
operating performance of the Corporation.
•Callable Bonds. The Corporation redeemed $200 million of 7.875 percent debentures and $200 million
of 7 percent debentures in the third quarter of 2003, enabling the Corporation to substantially lower our
financing costs. The pretax costs of calling the debentures totaled $18 million, equivalent to 2 cents per
share. Management also excludes this charge when evaluating operating performance of the
Corporation.
We calculate organic sales growth by excluding from the comparable GAAP measure (i) the effects of
changes in foreign currencies on the Corporation’s net sales and (ii) the effect on 2005 net sales of the NPI
spin-off described above.
Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for the
comparable GAAP measures. There are limitations to non-GAAP financial measures because they are not
prepared in accordance with GAAP and they may not be comparable to similarly titled measures of other
companies due to potential differences in methods of calculation and items being excluded. The Corporation
compensates for these limitations by using non-GAAP financial measures as supplements to the GAAP measures
and by providing the reconciliations of the non-GAAP and comparable GAAP financial measures. The
non-GAAP financial measures should be read only in conjunction with the Corporation’s consolidated financial
statements prepared in accordance with GAAP.
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