Hormel lowers outlook
August 08, 2008
by FoodBusinessNews.net Staff
AUSTIN, MINN. — Hormel Foods Corp. said it expects its third-quarter earnings to be in the range of 37c to 39c per share, down from 41c per share during the same quarter of last year.
"Higher-than-expected feed and fuel costs at our Jennie-O Turkey Store segment were the primary reason for the shortfall in our third-quarter results," said Jeffrey M. Ettinger, chairman, president and chief executive officer. "While we have continued to implement price increases in this segment, they have not been adequate to offset the higher input costs. An oversupply of turkey breast meat also kept pricing of commodity breast meat at a low level, exacerbating the cost-price differential."
Mr. Ettinger said Hormel is adjusting its full-year guidance to $2.22 to $2.28 per share, down from its previous guidance of $2.30 to $2.40 per share but up from $2.17 per share last year. He also said the company expects to see continued earnings pressure at Jennie-O Turkey Store from higher input costs during the fourth quarter.