KIMBERLY CLARK CORPKMB

KIMBERLY CLARK CORP Leases Disclosure

10-KFiled Feb 12, 20263 min read
Leases and Commitments
We have entered into leases for certain facilities, vehicles, material handling and other equipment. Our leases have remaining contractual terms up to 93 years, some of which include options to extend the leases for up to 99 years, and some of which include options to terminate the leases within 1 year. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Our lease costs are primarily related to facility leases for inventory warehousing and administration offices.
Lease Expense
Year Ended December 31
202520242023Income Statement Classification
Operating lease expense$141 $136 $131 Cost of products sold, Marketing, research and general expenses
Finance lease expense:
Amortization of lease assets15 14 12 Cost of products sold
Interest on lease liabilities3 3 2 Interest expense
Total finance lease expense18 17 14 
Variable lease expense(a)
136 132 214 Cost of products sold, Marketing, research and general expenses
Total lease expense$295 $285 $359 
(a)    Includes short-term leases, which are immaterial.
Lease Assets and Liabilities
December 31
20252024Balance Sheet Classification
Assets
Operating lease$369 $363 Other Assets
Finance lease49 46 Property, Plant and Equipment, Net
Total lease assets$418 $409 
Liabilities
Current:
Operating lease$128 $116 Accrued expenses and other current liabilities
Finance lease13 12 Debt payable within one year
Noncurrent:
Operating lease258 265 Other Liabilities
Finance lease30 32 Long-Term Debt
Total lease liabilities$429 $425 
As of December 31, 2025 and 2024, accumulated amortization of finance lease assets was $36 and $28, respectively.
Maturity of Lease Liabilities
December 31, 2025
Operating LeasesFinance LeasesTotal
2026$146 $15 $161 
2027116 13 129 
202869 10 79 
202942 5 47 
203027 3 30 
Thereafter38 5 43 
Total lease payments438 51 489 
Less imputed interest52 8 60 
Present value of lease liabilities$386 $43 $429 
Supplemental Information Related to Leases
The Consolidated Statements of Cash Flows are presented on a consolidated basis for both continuing operations and discontinued operations. As a result, unless specifically stated, supplemental cash flow information shown below reflects Kimberly-Clark's consolidated results for all periods presented.
Year Ended December 31
202520242023
Cash paid for amounts included in the measurement of lease liabilities:
Operating leases$160 $156 $147 
Finance leases25 19 17 
Lease assets obtained in exchange for new lease obligations:
Operating leases40 74 66 
Finance leases14 23 24 
Other non-cash modifications to lease assets:
Operating leases89 39 39 

Lease terms and discount rates were as follows:
December 31, 2025December 31, 2024
Operating LeasesFinance LeasesOperating LeasesFinance Leases
Weighted-average remaining lease term (years)4.14.64.24.9
Weighted-average discount rate5.8%6.3%4.3%6.3%
As of December 31, 2025, we have additional operating leases that are expected to commence in 2026 and are therefore not included in the measurement of the right-of-use assets and liabilities disclosed in the table above. These leases have cumulative minimum lease commitments of approximately $186, with terms ranging from 7 to 10.5 years.
We have entered into long-term contracts for the purchase of raw materials, primarily superabsorbent materials, pulp and certain utilities. Commitments under these contracts based on current prices are $956 in 2026, $415 in 2027, $411 in 2028, $346 in 2029, $348 in 2030, and $1,387 beyond the year 2030.
Although we are primarily liable for payments on the above-mentioned leases and purchase commitments, our exposure to losses, if any, under these arrangements is not material.

Historical Timeline

Fiscal YearFiled
2025Feb 12, 2026Showing above
2024Feb 13, 2025
2023Feb 8, 2024
2022Feb 9, 2023
2021Feb 10, 2022
2020Feb 11, 2021
2019Feb 13, 2020
2017Feb 8, 2018
2016Feb 8, 2017
2015Feb 11, 2016

About Leases Disclosures

Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.

Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.

Other Available Disclosures

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