Hershey / PA. (thc) The Hershey Company announced net sales and earnings for the third quarter ended October 03, 2021, and raised its full-year financial outlook. «Consumer demand for our brands has remained robust on both a one- and two-year basis,» said Michele Buck, The Hershey Company President and Chief Executive Officer. «Our continued focus on operating with speed and agility has enabled us to respond quickly to changes in the marketplace and develop plans to maintain sales momentum, increase production and sustain our advantaged margin structure over the long term. We are raising both sales and earnings guidance for 2021 to reflect elevated consumer demand across markets, an improved tax outlook and optimized brand investment, which, collectively, are expected to more than offset higher supply chain costs and inflation.»
Third-Quarter 2021 Financial Results Summary
- Consolidated net sales of USD 2,359.8 million, an increase of 6.3 percent.
- Organic, constant currency net sales increased 4.4 percent.
- The impact of acquisitions on net sales was a 1.4-point benefit, and foreign currency exchange was a 0.5-point benefit.
- Reported net income of USD 444.9 million, or USD 2.14 per share-diluted, in line with the prior period.
- Adjusted earnings per share-diluted of USD 2.10, an increase of 12.9 percent.
2021 Full-Year Financial Outlook
The company is updating its 2021 net sales and earnings outlook:
- Full-year net sales growth is now expected to be in the range of 8 percent to 9 percent, an increase from the previously communicated range of 6 percent to 8 percent.
- 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 6.88 to USD 7.04, an increase of 13 percent to 15 percent from USD 6.11 in fiscal 2020, and an increase from the previously communicated range of 8 percent to 12 percent.
- Full-year adjusted earnings per share are now expected to be in the range of USD 6.98 to USD 7.11, an increase of 11 percent to 13 percent from USD 6.29 in fiscal 2020, and an increase from the previously communicated range of 8 percent to 10 percent.
The increase in outlook reflects stronger than anticipated consumer demand, an improved tax outlook and optimized brand investment, which, collectively, are expected to more than offset higher supply chain costs and inflation.
The company also expects:
- A reported and adjusted effective tax rate in the range of 15 percent to 16 percent versus the previous outlook of 17 percent to 18 percent, driven by the utilization of certain capital losses.
- Other expense, which primarily reflects the write-down of equity investments that qualify for tax credits, remains approximately USD 125 million for 2021.
- Capital expenditures of approximately USD 500 to USD 525 million versus the previous outlook of USD 550 million largely due to project timing.
For additional information please refer to the company’s news release (PDF | 121 KB):20211029-HERSHEY-Q3-2021