Higher sales, cost savings boost McCormick profit

by Staff
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SPARKS, MD. — Higher sales and cost savings helped contribute to a 1% increase in income during fiscal 2011 for McCormick & Co., Inc.

For the year ended Nov. 30, 2011, the company had income of $374.2 million, equal to $2.82 per share on the common stock, which compared with income of $370.2 million, or $2.79 per share, during fiscal 2010. Sales for the year were $3,697.6 million, up 11% from $3,336.8 million.

“At McCormick, 2011 was a year of significant accomplishment,” said Alan D. Wilson, president and chief executive officer. “We completed three acquisitions, and the integration of these businesses has gone well. These acquisitions are accelerating our sales and profit growth and have expanded our presence in emerging markets and across several growth platforms. In 2012 we expect at least 13% of sales to come from emerging markets, up from 6% in 2006. Innovation is another key avenue of growth and new products launched in the past three years added 9% to sales in 2011. Cost savings in 2011 from our Comprehensive Continuous Improvement program totaled $65 million, ahead of our initial target. Along with our pricing actions, these cost savings provided an offset to increased material costs and also helped fuel a $20 million increase in brand marketing support.”

For the fourth quarter ended Nov. 30, the company had income of $131.7 million, or 99c per share, up 1% from $133.6 million, or $1 per share, during the same quarter of the previous year. Sales for the quarter were $1,110.7 million, up 13% from $979.5 million.

“Consumers around the world continue to demand great taste, and we are meeting this demand with our passion for flavor, innovative new products, in-store merchandising and creative meal ideas,” Mr. Wilson said. “Our outlook is for solid profit growth in 2012 driven by higher sales and further cost savings. We expect the weak economy and volatile material costs to persist, and we intend to continue adapting our pricing actions and marketing programs. We also plan to offset a portion of increased costs and fuel higher brand marketing support with our C.C.I. cost savings and have set a goal to achieve at least $40 million in 2012.”

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