Hormel Foods Corporation
), a food company, posted earnings per share of 42 cents in the
third quarter of fiscal 2013 (ended July 28, 2013), a penny
higher than the year-ago quarter. However, earnings missed the
Zacks Consensus Estimate of 44 cents by 4.5%.
Hormel's net sales for the reported quarter were $2,159.5
million, up 7.5% year over year. Revenues also beat the Zacks
Consensus Estimate of $2,127.0 million. The year-over-year
increase was mainly led by a hike in all the segments,
accompanied by the recently acquired Skippy peanut butter line.
Total volume was up 3.0% year over year.
During the reported quarter, revenues from
improved 24.6% year over year to $370.3 million, while
Jennie-O Turkey Store
witnessed a revenue rise of 4.4% to $367.1 million. The
segment's revenues increased 2.2% year over year to $1,068.6
revenues grew 4.5% to $240.5 million while revenues from
International & Other
segment swelled 31.4% to $113.0 million during the reported
Hormel's gross profit for the third quarter of fiscal 2013 was
$330.3 million, up 7.6% from $307.1 million in the comparable
quarter last year. Operating profit margin in the quarter
decreased roughly 19 basis points year over year to 8.4%.
Operating profits for Grocery Products for the reported
quarter increased 32.2%, while Jennie-O Turkey Store registered a
rise of 16.7% year over year. Operating profits for the
Refrigerated Foods segment decreased 26.3% in the quarter.
Operating profit for Specialty Foods jumped 7.8% and
International & Other segment's profit surged 34.2% year over
At the end of the reported quarter, the company recorded cash and
cash equivalents of $329.5 million, up from $262.7 million at the
end of the preceding quarter. Long-term debt (less current
maturities) stood at $250.0 million at the end of the quarter,
flat compared with the preceding quarter.
The company paid a quarterly dividend at an annual rate of 68
cents per share on Aug 15, 2013, representing the 340
straight dividend payout by the company.
In view of the current quarter results, management expects to
achieve its previous earnings guidance in the range of $1.88 to
$1.96 per share in fiscal 2013. It is expected that all the
segments, except Specialty Foods, will grow in the fourth quarter
of fiscal 2013. Jennie-O Turkey Store segment, which experienced
difficult times in the year are expected to rebound in the next
quarter, boosting the total revenue as well as earnings.
Other Stocks to Consider
Pilgrim's Pride Corporation
) announced second-quarter 2013 operating earnings of 74 cents
per share, beating the Zacks Consensus Estimate of 56 cents by
Tyson Foods, Inc.
) announced fiscal third-quarter 2013 operating earnings of 69
cents per share, beating the Zacks Consensus Estimate of 59 cents
Hillshire Brands Company
) announced fiscal fourth-quarter 2013 operating earnings of 26
cents per share, beating the Zacks Consensus Estimate of 24 cents
Hormel currently holds a Zacks Rank #4 (Sell).
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