Kimberly-Clark de Mexico SAB (KIMBER.MX, KCDMY) said its profits declined in the fourth quarter of 2010 despite record sales as the consumer-products company continued to face cost pressures for raw materials.

The unit of Kimberly-Clark Corp. (KMB) reported net profit of 1.2 billion pesos ($97 million) for the October-December period, compared with MXN1.28 billion in the year-ago quarter.

Fourth-quarter sales rose 6% to MXN6.87 billion, with sales volume up 1% and prices 5% higher on average. Cost containments and a better sales mix helped to offset higher costs for cellulose, recycled fiber, and energy, the company said.

Operating profit fell 4% to MXN 1.82 billion, while operating cash flow measured by earnings before interest, taxes, depreciation and amortization fell 6% to MXN2.09 billion.

"In order to offset these cost pressures, we will accelerate and intensify our cost-reduction programs as well as continue to implement the necessary actions to improve our selling prices and mix," Kimberly-Clark de Mexico said.

Kimberly-Clark de Mexico A shares trading on the Mexican stock exchange fell 1.6% Thursday to MXN70.40.

For all of 2010, the company reported net profit rose 2% from 2009 to MXN4.22 billion, with sales up 6% to MXN26.2 billion and operating profit up 3% to MXN6.88 billion. The company had capital expenditures of MXN 1.94 billion last year, and spent MXN1.07 billion on stock buybacks.

-By Anthony Harrup, Dow Jones Newswires; (5255) 5980-5176; anthony.harrup@dowjones.com
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