McCormick income increases 13% in quarter
SPARKS, MD. — Increased sales and the success of growth initiatives contributed to a 13% increase in income at McCormick & Co., Inc. during the third quarter.
For the quarter ended Aug. 31, the company had income of $104.4 million, equal to 79c per share on the common stock, which compared with $92 million, or 69c per share, during the same quarter of the previous year. Sales for the quarter were $977.7 million, up 6% from $920.4 million during the same quarter of the previous year.
“Our third-quarter financial results demonstrate the effectiveness of McCormick’s growth initiatives, even in a challenging economic environment,” said Alan D. Wilson, chairman, president and chief executive officer. “We reported a 9% increase in sales in local currency and strong profit growth with solid performance in both our consumer and industrial businesses. Acquisitions, new product innovation, brand marketing programs and expanded distribution are helping to drive sales growth in each geographic region. We had particular strength in emerging markets, which accounted for 14% of third quarter sales. In mid-2013, we anticipate expanding our emerging market presence with the acquisition of Wuhan Asia-Pacific Condiments Co., Ltd., which will extend our geographic footprint and flavor portfolio in China.
“Across all of our businesses, we continue to face volatile material costs. However, we are effectively offsetting the impact of higher material costs with our pricing actions and cost savings from our Comprehensive Continuous Improvement program. C.C.I. is also helping to fund our growth, and in 2012 we are on track to increase our brand marketing support by at least $15 million. Our employees have been doing outstanding work on C.C.I., and we now expect to exceed $50 million of cost savings in 2012. With these C.C.I. cost savings, additional brand marketing support, product innovation and other sales growth initiatives, we have momentum as we head into the final quarter of 2012.”
For the nine months ended Aug. 31, the company saw income rise 7% to $259.3 million, or $1.95 per share, which compared with $242.4 million, or $1.83 per share, during the same period of the previous year. Sales for the period were $2,868.4 million, up 11% from $2,586.9 million.
The company also increased its full-year earnings per share guidance range to $3.03 to $3.08 to reflect a more favorable tax rate.