Hormel Foods Posts Upbeat Q2 Profit, But Revenue Misses Estimates

reported stronger-than-expected earnings for the fiscal second quarter. The Austin, Minnesota-based company posted quarterly net earnings of $180.2 million, or $0.67 per share, compared to $140.1 million, or $0.52 per share, in the year-ago quarter. Its revenue rose 1.5 percent to $2.28 billion. However, analysts were expecting a profit of $0.62 per share on revenue of $2.40 billion. The average estimate among 8 Estimize users was for earnings of $0.62 per share and revenue of $2.41 billion. Its volume increased 5 percent in the quarter. Jennie-O Turkey Store segment sales climbed 15 percent, while operating profit rose 41 percent. In the refrigerated-foods segment, sales slipped 8 percent to $1.02 billion, while operating profit surged 52 percent. Grocery products segment sales rose around 1 percent, while operating profit gained 1 percent. Specialty foods segment sales climbed 32 percent in the quarter, while operating profit jumped 11 percent. International & Other segment operating profit rose 2 percent, while sales dropped 7 percent. "We achieved record second quarter earnings and sales, driving double-digit earnings growth with all five segments delivering increases," said Jeffrey M. Ettinger, chairman of the board, president and chief executive officer. "While we enjoyed an excellent first half, we expect Jennie-O Turkey Store to be significantly challenged going forward due to the impacts of avian influenza on our turkey supply chain," added Ettinger The company projects full-year non-GAAP earnings at the lower end of its prior forecast range of $2.50 to $2.60 per share. Hormel Foods shares rose 0.13 percent to close at $55.79 yesterday.