Strong sales lift Hormel profit in quarter

by Staff
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AUSTIN, MINN. — Strong sales of Spam and Jennie-O Turkey Store products contributed to a 13% increase in earnings at Hormel Foods Corp. during the third quarter.

For the quarter ended July 29, the company had earnings of $111,167,000, equal to 42c per share on the common stock, which compared with $98,481,000, or 37c per share, during the same quarter of the previous year. Sales for the quarter were $2,008,188,000, up 5% from $1,910,592,000 during the same quarter of the previous year.

“We had an excellent quarter, with earnings per share and sales up 14% and 5%, respectively,” said Jeffrey M. Ettinger, chairman of the board, president and chief executive officer. “All five segments reported increased earnings, led by our Grocery Products segment. Our strong sales growth across multiple segments demonstrates that our products are connecting well with consumers.

“Our Grocery Products segment benefitted from strong sales of our Spam family of products and from our MegaMex Foods joint venture. I was also pleased to see sales of our Hormel Compleats microwave meals grow nicely in the quarter. Our Jennie-O Turkey Store segment delivered another good quarter, aided by increased value-added sales and an improved product mix. Our international business continues to achieve impressive results, led by strong export sales of our Spam family of products and fresh pork. Increased value-added sales offset lower pork operating margins, boosting our Refrigerated Foods segment results during the quarter. Our Specialty Foods team generated excellent results on higher sales during the quarter.”

The Grocery Products segment had an operating profit of $40,052,000, up 32% from $30,428,000 during the same quarter of the previous year. Sales for the segment were $297,177,000, up 21% from $245,368,000 during the same quarter of the previous year.

The Refrigerated Foods segment had an operating profit of $60,757,000, up 7% from $56,820,000 during the same quarter of the previous year. Sales for the segment were $1,043,311,000, down slightly from $1,045,874,000 during the same quarter of the previous year.

The Jennie-O Turkey Store had an operating profit of $39,106,000, up 12% from $34,851,000 during the same quarter of the previous year. The segment had sales of $351,604,000, up 7% from $327,809,000 during the same quarter of the previous year.

For the nine months ended July 29, the company as a whole saw earnings rise 3% to $367,449,000, or $1.39 per share, which compared with earnings of $356,886,000, or $1.34 per share, during the same period of the previous year. Sales for the nine months were $6,060,486,000, up 5% from $5,791,191,000.

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