Jul. 24, 2014, 6:49 PM
- Hershey (NYSE:HSY) CEO John Bilbrey warns that the chocolate maker's first price hike in three years likely will hurt sales volumes for the rest of the year and into 2015, but believes the popularity of chocolate will prevail over the long term.
- "A price increase was necessary to protect our margins," Bilbrey said in today's earnings call.
- HSY announced its average 8% price increase on July 15, saying it was in response to soaring cocoa and dairy prices, and rival Mars said yesterday it was raising prices 7%.
- HSY already is losing market share, and the loss of customers from price increases "will be higher this go-round relative to the price increases of 2011 and 2012," Consumer Edge Research analyst Rob Dickerson says.
Jul. 24, 2014, 10:18 AM
- Hershey’s (HSY -1.9%) Q2 net income increased 5.4% Y/Y to $168.2M from $159.5M in the same quarter a year ago.
- 60% of overall volume growth was derived from new product offerings, with core products contributing the remaining 40%.
- Revenue rose 4.6% to $1.58B from $1.51B Y/Y.
- Due to increased input costs, the company reported a gross margin of 45.5%, 210 basis points lower than the gross margin in Q2 2013.
- Hershey's expects full-year 2014 net sales growth to be around the low end of its long-term 5-7% target due to the impact of price increases and foreign currency exchange rates.
- Q2 earnings
Jul. 24, 2014, 8:44 AM
Jul. 24, 2014, 7:03 AM
Jul. 23, 2014, 5:30 PM
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Jul. 17, 2014, 9:03 AM
- The price of palm oil reached a nine-month low earlier today after strong soybean and corn crops this year boosted stockpiles.
- Major companies such as Hershey (NYSE:HSY), Unilever (NYSE:UL), and Procter & Gamble (NYSE:PG) could see reduced input costs due to the development, although many of them have reduced their use of palm oil.
Jul. 16, 2014, 2:09 PM
- Investors are punishing Hershey (HSY -2.5%) after the company raised prices yesterday and offered a new sales forecast on the low end of its previous guidance.
- Credit Suisse cuts it rating on the candy seller to Neutral from Outperform on its view that valuation has outrun earnings growth.
- Though Nestle and Kraft Foods Group are expected to follow with price hikes of their own, analysts think they will squeeze out a little marketing spin on Hershey's higher prices first.
Jul. 15, 2014, 4:46 PM
- Just in time for Janet Yellen to amend her remarks about no inflation before tomorrow's 2nd day of congressional testimony, Hershey (NYSE:HSY) announces a weighted average price boost of about 8% across its packaged candy and grocery lines, effective today. The increase is intended to help offset the significant jumps in input costs, including raw materials, packaging, fuel, utilities, and transportation.
- Due to the transitional nature of the price increase, Hershey doesn't expect much income statement benefit until 2015.
- The company now sees sales growth to be towards the lower end of its 5-7% target this year. At the same time, commodity costs should grow faster than the previous estimates, leaving expected full year 2014 adjusted EPS to be towards the low end of the long-term 9-11% growth target.
- Q2 sales and earnings however, should be about inline with the previous forecast, with adjusted EPS still expected at $0.75-$0.77.
- Source: Press Release
Jul. 2, 2014, 7:26 AM
- A positive forecast from the Almond Board of California on the 2014-2015 almond crop could provide a benefit to some food sellers, advises Hedgeye's Howard Penney.
- White Wave Foods (WWAV), Hain Celestial (HAIN), and Hershey (HSY) top the list of companies looking for moderate input costs on almonds.
May 29, 2014, 7:55 AM
May 23, 2014, 11:05 AM
- Wells Fargo analyst John Baumgartner forecasts a continued drop in milk prices after seeing Class I milk peak earlier in the month.
- The news could be a relief for a number of companies (DF, WWAV, SJM, DF, NSRGY, LWAY, DNKN, MCD, SBUX, GIS, HSY, MJN, ADY) which have faced margin pressure over the escalated cost of wholesale milk products.
- Milk price chart
- Related ETF: MOO
May 21, 2014, 10:29 AM
- Hershey (HSY -1%) is an active participant at the Corporation Innovation Exchange in Silicon Valley as it continues to monitor potential tech innovations which it could use to boost sales.
- The company already has an initiative in place to explore 3D printing opportunities and is closely watching the biometric technology sector for how it could shape food demand in the future.
Apr. 29, 2014, 6:52 AM
Apr. 24, 2014, 8:13 AM
- Hershey (HSY) gives a mixed read on its business with its Q1 report.
- The company cited soft demand in the Latin America and notes it saw "irregular" purchasing patterns by U.S. consumers in traditional food channels. The penny earnings beat was derived from some successful cost initiatives and productivity gains.
- Volume was a 3.2 percentage benefit to top line growth in Q1, while foreign exchange translation was a 0.8 percentage point headwind.
- HSY -0.2% premarket
Apr. 24, 2014, 7:02 AM
Apr. 24, 2014, 12:05 AM
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HSY vs. ETF Alternatives
The Hershey Co is engaged in the manufacturing, marketing, selling and distributing chocolate and sugar confectionery products, pantry items, such as baking ingredients, toppings and beverages; and gum and mint refreshment products.
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