AUSTIN, MINN. — Net income at Hormel Foods Corp. in the third quarter ended July 26 totaled $77,169,000, equal to 57c per share on the common stock, up 49% from $51,947,000, or 38c per share, in the same period a year ago.
Sales for the quarter were $1,574,440,000, down 6% from $1,678,142,000 during the previous year.
Improved performance from Hormel’s Refrigerated Foods and Jennie-O Turkey Store segments combined with another strong quarter from the company’s Grocery Products business helped drive third-quarter earnings. Operating profit for the Grocery Products business unit increased 11% during the quarter based on strong sales of SPAM products, Hormel chili and the company’s Herdez line.
Operating profit within the company’s Refrigerated Foods segment increased 60% during the quarter, according to the company. Sales of retail value-added products such as Hormel Pepperoni, party trays and the DiLusso Deli Co. products offset the impact of a challenging pork environment. The company said food service sales continued to be soft.
Total segment operating profit for the Jennie-O Turkey Store business unit improved 97% compared with the third quarter of fiscal 2008 due to lower feed costs that was prompted by the planned reduction of turkey production and a reduced cost per ton. The reduced production helped offset the continued challenge of low commodity meat prices, by reducing exposure to those markets.
"As a result of our strong third-quarter results, we anticipate full-year results in our recently announced range of $2.36 to $2.42 per share," said Jeffrey Ettinger, chairman, president and chief executive officer. "Although we are faced with challenges, including the weak economy, a continued excess supply of commodity turkey meat, and difficult export markets, our balanced business model, continued strength in our core franchise products, and our very committed team should allow us to deliver an excellent year."
For the first nine months of the year, Hormel recorded net income of $238,937,000, or $1.78 per share. For the first nine months of fiscal 2008 Hormel’s net income was $217,689,000, or $1.61 per share. Sales for the period were $4,858,569,000, which compared with $4,893,391,000 for fiscal 2008.