Hershey increases prices
August 18, 2008
by FoodBusinessNews.net Staff
HERSHEY, PA. — The Hershey Co. is increasing its wholesale prices in the United States, Puerto Rico and export chocolate and sugar confectionery lines.
The average increase of 11% is already effective for the company’s instant consumable, multi-pack and packaged candy lines.
"Commodity costs have been volatile over the last several years and continue to remain at levels that are well above historical averages," said David J. West, president and chief executive officer. "Market prices for ingredients such as cocoa, corn sweeteners, sugar and peanuts are up 20% to 45% since the beginning of the year. As such, in 2009 we expect our commodity cost increase to be more than double the 2008 increase."
The company said the increases represent a 10% increase over Hershey’s entire domestic product line and will help offset a portion of the increases in input costs such as raw materials, packaging materials, fuel, utilities and transportation.
For the full-year 2008, the company expects net sales growth of 3% to 4%, and in 2009 the company anticipates net sales growth of 2% to 3% verses the previous estimate of 3% to 5%. For 2008, earnings per share are expected to be within the $1.85 to $1.90 range previously predicted, but at the lower end of the range. E.P.S. from operations are expected to increase in 2009 but at a rate below the long-term objective of 6% to 8% growth.