Hershey income eases 29% in quarter

by FoodBusinessNews.net Staff
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HERSHEY, PA. — An unusually early Easter and the decision to discontinue Ice Breakers PACS negatively impacted financial performance for The Hershey Co. during the first quarter ended March 30.

Net income for the quarter was $83,915,000, equal to 38c per share on the common stock, down 29% from $118,786,000, or 53c per share, during the same quarter of the previous year. Net sales for the quarter were $1,160,342,000, up slightly from $1,153,109,000 during the same quarter of 2007.

"Net sales increased slightly in the first quarter and were in line with our expectations," said David J. West, president and chief executive officer. "As we previously communicated, the current period was adversely impacted by an unusually early Easter and the mid-January decision to discontinue Ice Breakers PACS. Operating profit targets were achieved in a rising input cost environment. We invested behind our core brands in the first quarter and will continue to do so throughout 2008 to strengthen our position in the marketplace."

The company said Hershey’s Bliss and Starbucks product launches shipped to consumers on schedule in mid-March and consumer investment will accelerate in the second quarter to ensure the success of the launches.

"As we look ahead to the balance of 2008, plans are in place to deliver our sales and earnings objectives," Mr. West said. "Specifically, the launch of new products, increased levels of brand support, consumer investment, retail coverage and merchandising will continue to build throughout the year. We expect this to result in a sequential improvement in net sales."

The company expects sales growth of 3% to 4% for the year and earnings per share from operations of $1.85 to $1.90.

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