Hershey: Announces Q4 and Full-Year 2009 Results

Hershey / PA. (thc) The Hershey Company announced sales and earnings for the fourth quarter ended December 31, 2009. Consolidated net sales were 1’407’336’000 USD compared with 1’377’380’000 USD for the fourth quarter of 2008. Reported net income for the fourth quarter of 2009 was 126’779’000 USD or 0,55 USD per share-diluted, compared with 82’155’000 USD or 0,36 USD per share-diluted for the comparable period of 2008.

For the fourth quarters of 2009 and 2008, these results, prepared in accordance with U.S. generally accepted accounting principles (GAAP), include net pre-tax charges of 26,5 million USD and 79,7 million USD, or 0,08 USD and 0,23 USD per share-diluted, respectively. These charges were associated with the Global Supply Chain Transformation (GSCT) program. Adjusted net income, which excludes these net charges, was 144’352’000 USD or 0,63 USD per share-diluted in the fourth quarter of 2009, compared with 133’842’000 USD or 0,59 USD per share-diluted in the fourth quarter of 2008 – an increase of 6,8 percent in adjusted earnings per share-diluted.

For the full year 2009, consolidated net sales were 5’298’668’000 USD compared with 5’132’768’000 USD in 2008, an increase of 3,2 percent. Reported net income for 2009 was 435’994’000 USD or 1,90 USD per share-diluted, compared with 311’405’000 USD or 1,36 USD per share-diluted for 2008.

For the full years 2009 and 2008, these results, prepared in accordance with GAAP, include net pre-tax charges of 99,1 million USD and 180,7 million USD, or 0,27 USD and 0,52 USD per share-diluted, respectively. These charges were associated with the GSCT program. Adjusted net income for the full year 2009, which excludes these net charges, was 496’817’000 USD or 2,17 USD per share-diluted, compared with 430’522’000 USD or 1,88 USD per share-diluted in 2008, an increase of 15,4 percent in adjusted earnings per share-diluted.

During the fourth quarter of 2009, the GSCT program concluded. Total charges were 629,1 million USD, including 85,0 million USD in non-cash pension settlement charges discussed in prior quarters. Excluding pension settlement charges, project implementation, management and start-up costs of 544,1 million USD were less than the estimate of 575 million USD to 600 million USD. Except for possible non-cash pension settlement charges, the Company does not expect any significant charges related to the GSCT program in 2010. Total GSCT program savings through 2009 are approximately 160 million USD. Total ongoing annual savings from the GSCT program of approximately 175 million USD to 185 million USD will be achieved by the end of 2010. Savings from the program fueled the investment in Hershey´s brand-building and selling capabilities, enabling our marketplace success.

On February 01, 2010, the Board of Directors of The Hershey Company declared a quarterly dividend of 0,32 USD on the Common Stock, an increase of 0,0225 USD per share. In addition, the Board declared a dividend of 0,29 USD on the Class B Common Stock, an increase of 0,0222 USD per share. The dividends are payable March 15, 2010, to stockholders of record February 25, 2010.

«During 2009, Hershey made excellent progress in its consumer-driven approach to core brand investment while implementing significant, but necessary, price increases», said David J. West, President and Chief Executive Officer. «Our fourth quarter results represent a solid finish to a year marked by good progress against our key strategic initiatives despite the backdrop of the macroeconomic issues affecting consumers. Net sales increased 2,2 percent in the quarter, driven primarily by pricing and improvements in our international business, including an approximate one point benefit from foreign currency exchange rates. Importantly, base business volume trends, while down due to volume elasticity associated with the U.S. pricing action, sequentially improved in the fourth quarter, net of the previously communicated decisions to close our on-line gifts business and discontinue certain premium chocolate products. Additionally, as communicated in October, due to timing, shipments of Valentine´s and Easter seasonal products were lower in the fourth quarter of 2009 versus 2008».

Info: Hershey´s complete press release (HTML).
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