Hershey Lifts Outlook, Beats Estimates For Quarterly Results
Hershey Co raised its annual sales outlook and beat estimates for quarterly results on Thursday, as consumers bought more of its chocolates at airports, movie theatres and other food joints after the easing of COVID-19 curbs.
With Americans stepping out more after vaccinations and the relaxation of lockdowns, demand has rebounded for on-the-go consumables and refreshments after a year of weak sales.
Sales at Hershey's mainstay North America business rose 12.3% in the second quarter as consumers munched on SkinnyPop popcorn and gluten-free snack Pirate's Booty.
The company also reported a 70.2% surge in overseas market sales, marking a revival in a business that suffered last year due to coronavirus restrictions and the pandemic's impact on consumer spending.
Overall, net sales jumped nearly 17% to $1.99 billion, exceeding the average analyst estimate of $1.84 billion.
The US chocolatier said it expected 2021 net sales to rise between 6% and 8%, compared with a prior forecast of 4% to 6% growth. Analysts expected annual sales to be up nearly 6%, according to Refinitiv IBES data.
But Hershey maintained its annual adjusted profit outlook of $6.79 to $6.92 per share, citing higher supply chain costs.
Excluding one-time items, the company earned $1.47 per share in the quarter ended July 4, beating expectations of $1.43 per share.
President and chief executive officer of the Hershey Company, Michele Buck, said, "Our business continued to excel in the second quarter with robust recovery in away-from-home consumption and international markets and sustained elevated at-home consumption.
"This strong consumer demand, coupled with our executional excellence, healthy balance sheet and relentless focus on delivering against our strategic initiatives in the quarter enabled us to support and expand our portfolio, invest in our people and deliver strong shareholder returns. As trends continue to fluctuate, we are confident in our ability to adapt with our consumers and retailers and continue meeting their needs in the future."