Hershey, Pennsylvania. — The Hershey Co. overcame disruptions in his chain of sustained supply and achieved double-digit sales growth in each of his business segments in recent quarters. Management has raised its full-year outlook, reflecting continued strong demand and price gains across the portfolio. This is expected to more than offset rising costs and rising levels of advertising and merchandising in the coming months.
Net income for the second quarter ended July 3 was $315.6 million, or $1.53 per share, up from $301.2 million, or $1.45 per share, in the year-ago quarter. Excluding anomalous items, including mark-to-market losses on derivatives, restructuring activities, acquisition activities and other miscellaneous losses, adjusted net income was $372.4 million, compared with adjusted net income of $305.8 million in the prior year period. increased from $10,000.
Net sales were $2.4 billion, up 19% from $2.0 billion a year ago. Excluding the benefits of last year’s acquisitions of Dot’s, Pretzels and Lily and the impact of currency, Hershey’s organic net sales increased his 14% on higher pricing and volume.
“Second quarter growth was broad-based, with each segment delivering double-digit sales growth and higher earnings per share. and sales volume, with the acquisition contributing another 5 points of growth.Despite persistent and widespread supply chain disruptions, our team was able to improve production and inventory levels during the quarter We were able to improve our levels, which not only drove our revenue growth, but also improved our market share performance, allowing us to more fully revitalize our portfolio in the second half of the year. “
Inflation is putting pressure on many Americans, Buck said, but consumers are buying branded snacks and candy rather than lower-priced private label products in these categories.
“Across snacks, I think you tend to see consumers love their brand very much,” Buck said. “So when you look at food overall, as budgets get tighter, certainly private label brands are gaining share compared to overall snacks, but private label isn’t and consumers are more likely to buy their food. We tend to like brands.”
North America Confectionery segment revenues increased 12% to $618.9 million in the second quarter on higher pricing and volume, but higher supply chain costs, acquisition costs, trade fairs and travel Partially offset by year-on-year. The segment’s net sales grew 13% year-over-year to $1.9 billion. Candy, mints and gum sales in the US increased 5%, driven by strong consumer demand and higher prices.
“Looking toward the second half, we expect strong daily sales and shared performance driven by higher inventory levels and increased advertising and merchandising,” Buck said. “Chocolate media spending is expected to grow by double digits in the second half of the year, and quality merchandising is also expected to increase.
“Seasonal consumer engagement is expected to remain strong, with high-single-digit sales growth projected for both Halloween and the holiday season. cannot fully meet the demand for
“Given that many of our commodities and seasonal items are made on the same line, we have been working to balance production over the past few months to improve our daily shelf inventory while simultaneously building our seasonal inventory. This could create seasonal share pressure in the second half of the year, but we expect daily share trends to remain strong due to higher inventory levels and increased advertising and merchandising. I have.”
North America Salty Snacks segment revenues increased 44 percent to $37.4 million. Higher pricing and higher volumes offset unfavorable product mix, acquisition-related costs and higher supply chain costs. Net sales for the segment he increased 100% to $256.3 million. This was primarily due to the Dot’s and Pretzels acquisitions and, to a lesser extent, net price realization.
“Our savory snack brand continues to see tremendous growth and share gains,” Buck said. “In the last 12 weeks, SkinnyPop’s retail sales increased 17%, while its share of the ready-to-eat popcorn segment increased 130 basis points to 24%. Driven by purchase rates, new pack sizes allow us to capture more opportunities.
“Pirate’s Booty also continues to win over households through increased distribution, and velocity remains strong, resulting in a 32% increase in retail sales over the last 12 weeks. It significantly outperformed its category, with retail sales up 45% over the last three months and share up 340 basis points.
“To support this sustained, high growth, we are advancing strategic plans to optimize our salty snacks supply chain, adding additional capacity and increasing margin efficiency.”
Hershey’s International segment profit was $30.7 million, an increase of $3.1 million from the prior-year period. This reflects higher sales volumes and net price realization, partially offset by higher supply chain and logistics costs, advertising investment, salary and benefits inflation and higher travel costs. . International segment net sales increased 21% from the same period last year to $207.2 million.
“Consumer demand remains strong across markets, with distribution and innovation delivering double-digit growth in each market during the fourth quarter,” Buck said, adding that India’s Hershey’s Kisses and Mexico’s Better Highlighted -for You innovations as top performers.
For the full year, management now expects annual net sales growth of 12% to 14%, up from previous guidance of 10% to 12%. His reported earnings per share growth is expected to be in the range of 9% to 12%, compared with previous guidance of 8% to 11%.
Hershey Co. shares, which trade on the New York Stock Exchange, rose to $224.27 on July 28, up 2.8% from its previous close of $218.23.
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