Hormel Foods: Reports Second Quarter 2021 Results

Austin / MN. (hrl) Hormel Foods Corporation, a leading global branded food company, reported results for the second quarter of fiscal 2021. All comparisons are to the second quarter 2020 unless otherwise noted.

Executive Summary – Second Quarter

  • Volume of 1.2 billion lbs., down 3 percent
  • Record net sales of USD 2.6 billion, up 8 percent
  • Pretax earnings of USD 293 million, up 2 percent
  • Operating margin of 11.1 percent, compared to 12.1 percent last year
  • Effective tax rate of 22.1 percent, compared to 20.6 percent last year
  • Diluted earnings per share of USD 0.42, flat compared to last year

Executive Commentary

«Once again, our balanced business model has proven to be a winning formula as our team delivered record sales in the first half and is on pace to deliver a second consecutive year of record sales,» said Jim Snee, chairman of the board, president and chief executive officer. «We were able to achieve these record results through strong foodservice sales, continued elevated demand in the retail, deli and international channels, and improved supply chain performance.»

«We anticipated rapid demand changes in our foodservice business, and our team delivered, with sales exceeding 2019 pre-pandemic levels,» Snee said. «The investments we have made over the years to build a world-class foodservice business, including an experienced direct sales force and portfolio of products that solve for customer challenges, give us a competitive advantage as the industry recovery accelerates.»

«In addition to foodservice growth, demand in our retail and deli channels remains elevated compared to pre-pandemic levels (…),» Snee said. «Finally, our international business has never been stronger, with double-digit growth coming from our China business and branded exports.»

«The supply chain progress we have made in a difficult operating environment is impressive, and our production team members deserve credit for our record results,» Snee said. «Further, we are now benefiting from strategic actions we took before the pandemic to increase production capacity, especially for the pizza toppings and dry sausage categories.»

Outlook

«We are increasing our full year sales guidance range and reaffirming our earnings per share guidance range of USD 1.70 to USD 1.82 per share, both of which exclude the expected impact of the «Planters» snack nuts business,» Snee said. «We have a very positive outlook on the foodservice industry and continue to see elevated demand in the retail, deli and international channels. As we enter this inflationary period, we will continue to offset margin pressure with price actions and supply chain improvements. Our experienced management team has a proven ability to navigate and grow our business in volatile market conditions.»

For additional information please read the Company’s PDF file below (158 KB):

20210521-HORMEL-Q2-2021
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