Hershey / PA. (thc) The Hershey Company announced net sales and earnings for the second quarter ended July 04, 2021, and updated its full-year financial outlook.
«Our business continued to excel in the second quarter with robust recovery in away-from-home consumption and international markets and sustained elevated at-home consumption,» said Michele Buck, The Hershey Company President and Chief Executive Officer. «This strong consumer demand, coupled with our executional excellence, healthy balance sheet and relentless focus on delivering against our strategic initiatives in the quarter enabled us to support and expand our portfolio, invest in our people and deliver strong shareholder returns. As trends continue to fluctuate, we are confident in our ability to adapt with our consumers and retailers and continue meeting their needs in the future.»
Second-Quarter 2021 Financial Results Summary
- Consolidated net sales of USD 1,989.4 million, an increase of 16.5 percent.
- Organic, constant currency net sales increased 15.5 percent.
- Foreign currency exchange was a 1.0 point benefit to net sales.
- Reported net income of USD 301.2 million, or USD 1.45 per share-diluted, an increase of 12.4 percent.
- Adjusted earnings per share-diluted of USD 1.47, an increase of 12.2 percent.
2021 Full-Year Financial Outlook
The company is updating its 2021 net sales and earnings outlook to reflect the strength of its performance in the second quarter and the acquisition of Lily’s Sweets, LLC:
- Full-year net sales growth is now expected to be in the range of 6 percent to 8 percent, an increase from the previously communicated range of 4 percent to 6 percent. This increase is driven by stronger than anticipated recovery in the company’s away-from-home business and international markets, as well as the acquisition of Lily’s.
- The net impact of acquisitions and divestitures is anticipated to be a 0.7 point benefit.
- Full-year reported earnings per share are now expected to be in the range of USD 6.59 to USD 6.85, an increase of 8 percent to 12 percent from USD 6.11 in fiscal 2020. This slight decrease versus the previously communicated range of 9 percent to 12 percent is due to incremental costs to execute and integrate the Lily’s acquisition.
- Full-year adjusted earnings per share are still expected to be in the USD 6.79 to USD 6.92 range, unchanged from the previously communicated 8 percent to 10 percent increase from USD 6.29 in fiscal 2020. Increased profit from higher sales is expected to be offset primarily by incremental tax reserves incurred in the second quarter in connection with an adverse ruling in a non-U.S. tax litigation matter, as well as higher supply chain costs associated with servicing higher volume
The company also expects:
- A reported and adjusted effective tax rate in the range of 17 to 18 percent,
- Other expense of approximately USD 120 to USD 130 million,
- Interest expense of approximately USD 130 million, and
- Capital expenditures of approximately USD 550 million, driven by key initiatives including the company’s ongoing ERP transformation and supply chain initiatives.
For additional information please refer to the company’s news release (PDF | 117 KB):20210729-HERSHEY-Q2-2021