Hormel Foods Corporation (
posted earnings per share of 49 cents in the fiscal fourth
quarter of 2012 (ended October 28, 2012), in line with the Zacks
Consensus Estimate. The quarter's earnings also increased 14%
from 43 cents per share reported in the prior-year period.
Fiscal 2012 earnings came in at $1.86 per share, in line with
the Zacks Consensus Estimate. Earnings for the whole year also
increased from 2011 earnings of $1.74 by 7%.
Net sales for the reported quarter were $2,170.2 million, up
3.2% year over year; but lagged behind the Zacks Consensus
Estimate of $2,221.0 million. The year-over-year increase
reflected sales gain across four of the company's five
During the reported quarter, revenue from Grocery Products
improved 20.6% year over year and Jennie-O Turkey Store witnessed
a revenue growth of 5.0%. However, the Refrigerated Foods segment
registered a decline of 2.6% in revenue annually based on lower
commodity meat prices. On the other hand, Specialty Foods revenue
swelled 6.6% while revenue from all other items crept up 0.8%
during the reported quarter.
Net sales for the whole year inched up 4.3% to $8,230.7
million, as compared to $7,895.1 million in 2011. For the whole
year, the increase in net sales reflected an improvement in all
the reportable segments of the company.
Gross profit for the fourth quarter of 2012 was $351.8
million, up from $336.0 million in the comparable quarter last
year. Selling, general and administrative (SG&A) expenses
were up 1.9% year over year to $159.7 million in the quarter.
Operating profit for Grocery Products for the reported quarter
increased 21.9% while Refrigerated Foods registered a decline of
21.9% year over year. Operating profit for Jennie-O Turkey Store
jumped 5.4%, led by higher retail value-added sales. Specialty
Foods profit surged 7.9% year over year.
Balance Sheet/Cash Flow
At the end of the reported quarter, the company recorded cash
and cash equivalents of $682.4 million, up from $463.1 million at
the end of the comparable quarter last year. Long-term debt (less
current maturities) stood at $250 million at the end of the
During the quarter, net cash provided by operating activities
was recorded at $233.7 million compared with $171.1 million in
the year-ago quarter. Capital spending totaled $37.3 million as
compared with $39.8 million in the year-ago quarter.
The company paid a dividend of 60 cents on November 15, 2012,
straight dividend payout by the company.
Hormel anticipates earnings per share in fiscal 2013 to range
within $1.90-$2.00 based on positive sales momentum across all
the segments and value-added portfolio.
Based in Austin, Minnesota, Hormel Foods Corporation is a
leading manufacturer and marketer of various meat and food
products in the United States and internationally. The company
faces stiff competition from
ConAgra Foods Inc.
Tyson Foods Inc.
). Hormel has a Zacks #2 Rank, which translates into a short-term
(1-3 months) 'Buy' rating.
CONAGRA FOODS (CAG): Free Stock Analysis
HORMEL FOODS CP (HRL): Free Stock Analysis
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