Core Viewpoint - McCormick's quarterly earnings of $0.60 per share fell short of the Zacks Consensus Estimate of $0.64 per share, marking a -6.25% earnings surprise compared to the previous year's earnings of $0.63 per share [1][2] Financial Performance - The company reported revenues of $1.61 billion for the quarter ended February 2025, slightly missing the Zacks Consensus Estimate by 0.38%, and showing no significant change from the year-ago revenues of $1.6 billion [2] - Over the last four quarters, McCormick has surpassed consensus EPS estimates three times and topped consensus revenue estimates three times as well [2] Stock Performance - McCormick shares have increased approximately 5.4% since the beginning of the year, contrasting with the S&P 500's decline of -1.9% [3] - The current Zacks Rank for McCormick is 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6] Future Outlook - The consensus EPS estimate for the upcoming quarter is $0.69 on revenues of $1.67 billion, while the estimate for the current fiscal year is $3.07 on revenues of $6.82 billion [7] - The outlook for the Food - Miscellaneous industry, to which McCormick belongs, is currently in the bottom 31% of over 250 Zacks industries, suggesting potential challenges ahead [8]

Financial Data and Key Metrics Changes - Total organic sales increased by 2%, primarily driven by volume and product mix growth, partially offset by pricing [7][29] - Adjusted operating income declined by 5%, with a 3% decrease on a constant currency basis, primarily due to increased SG&A expenses [33][34] - First quarter adjusted earnings per share was $0.60 compared to $0.63 for the same period last year [36] Business Line Data and Key Metrics Changes - In the Global Consumer segment, organic sales increased by 1%, with a 3% volume growth offset by a 2% impact from pricing investments [29][30] - The Flavor Solutions segment saw organic sales growth of 3%, driven by 2% volume growth and a 1% contribution from price [32] - In the Americas, Flavor Solutions organic sales increased by 4%, reflecting a 3% price contribution and 1% volume growth [32] Market Data and Key Metrics Changes - In EMEA, consumer organic sales grew by 4%, driven by a 2% increase in volume and a 2% increase in price [30] - Asia Pacific region saw consumer organic sales increase by 3%, driven by a 2% increase in volume and a 1% contribution from price [31] - Flavor Solutions in Asia Pacific experienced a significant 15% organic sales increase, with 16% volume growth driven by QSR customer promotions [33] Company Strategy and Development Direction - The company remains focused on growth through category management, brand marketing, new products, and proprietary technologies [25][26] - Investments in brand marketing are prioritized to connect with consumers and fuel growth, with an expected increase in brand marketing spend in the high single digits [27][43] - The company aims to capitalize on secular trends in health and wellness, with a focus on meeting changing consumer dietary needs [14][15] Management's Comments on Operating Environment and Future Outlook - Management noted increasing consumer uncertainty and inflation concerns impacting consumer sentiment, particularly among lower-income consumers [11][12] - The company expects to maintain its guidance for the year, reflecting confidence in strong sales performance and growth across both segments [39][60] - Management anticipates gross margin expansion throughout the year, driven by product mix and cost savings from the CCI program [42][43] Other Important Information - The company returned $121 million to shareholders through dividends and used $37 million for capital expenditures [38] - The outlook for 2025 includes expectations for organic net sales growth to range between 3% and 4%, with volume-led growth anticipated [41][42] Q&A Session Summary Question: What drove the stronger than forecast operating profit decline in the consumer segment? - Management indicated that timing shifts related to stock-based compensation and brand marketing investments impacted the operating profit, but they remain confident in the full-year guidance due to strong sales performance [54][56][58] Question: Can you provide context on pricing dynamics in the Americas consumer business? - Management explained that pricing in the Americas is expected to be flat, with some incremental pricing in EMEA to address commodity pressures, while volume growth remains the primary driver [66][70] Question: How is the company addressing tariff risks? - Management stated that known tariffs on China have been accounted for in their forecasts, and they are closely monitoring potential future tariff changes while preparing to manage any impacts [94][96] Question: What should investors expect in terms of EBIT and EPS in Q2? - Management noted that Q1 was expected to be different from the rest of the year, with continued top-line growth and gross margin improvements anticipated in the second half of the year [99][100]

Financial Performance - McCormick reported first quarter sales of $1.605 billion, reflecting a 0.2% increase compared to the previous year, with a 2% unfavorable impact from currency[6]. - Organic sales growth for the first quarter was 2%, driven by volume growth of 2.2% and a 0.2% decrease from pricing[7]. - Operating income for the first quarter was $225 million, a decrease of 3.6% from $234 million in the prior year, with adjusted operating income also at $225 million, down 5%[8]. - Earnings per share (EPS) for the first quarter was $0.60, compared to $0.62 in the same period last year, reflecting a 3.2% decline[12]. - Total net sales increased by 0.2% as reported, with a constant currency and organic growth of 2.0%[26]. - Net sales for the three months ended February 28, 2025, were $1,605.5 million, a slight increase from $1,602.7 million in the same period of 2024[38]. - Gross profit margin improved to 37.6% in Q1 2025 from 37.4% in Q1 2024[38]. - Net income for the three months ended February 28, 2025, was $162.3 million, compared to $166.0 million in the same period of 2024[41]. Segment Performance - The Consumer segment reported sales of $919 million, consistent with the previous year, while the Flavor Solutions segment saw a 1% increase to $686 million[9]. - Adjusted operating income for the consumer segment decreased by 16.8% as reported, with a constant currency decline of 15.9%[26]. - Adjusted operating income for the flavor solutions segment increased by 27.9% as reported, with a constant currency growth of 33.2%[26]. - Total flavor solutions reported a 0.8% increase in sales, with a constant currency growth of 3.3%[26]. - The Americas region reported a 0.4% decline in total consumer sales, with a constant currency growth of 0.1%[26]. - The APAC region showed a significant increase in flavor solutions sales by 12.7% as reported, with a constant currency growth of 15.3%[26]. Future Outlook - The company expects fiscal 2025 net sales growth of 0% to 2%, with organic sales growth anticipated to be 1% to 3%[15]. - Operating income for fiscal 2025 is projected to grow by 3% to 5%, with adjusted operating income growth expected to be in the range of 4% to 6%[15]. - The projected percentage change in net sales for the year ending November 30, 2025, is expected to be between 0% to 2%[27]. - The projected percentage change in adjusted operating income for the year ending November 30, 2025, is expected to be between 3% to 5%[27]. - The percentage change in net sales in constant currency is projected to be between 1% to 3%[27]. - Adjusted earnings per share (diluted) for 2025 projected to be between $3.03 and $3.08, compared to $2.95 for 2024[28]. Cost Management and Strategic Initiatives - McCormick anticipates a special charge impact of $15 million related to organizational and streamlining actions in fiscal 2025[15]. - The company plans to offset costs related to U.S. import tariffs on China through cost savings initiatives and targeted price adjustments[17]. - McCormick's fiscal 2025 outlook includes strong cash flow expectations driven by profit and working capital initiatives, with a commitment to return a significant portion to shareholders through dividends[16]. - Cash and cash equivalents decreased to $102.8 million as of February 28, 2025, down from $186.1 million at the end of November 2024[39]. - Total assets decreased to $12,899.8 million as of February 28, 2025, from $13,070.3 million at the end of November 2024[39]. - Total liabilities decreased to $7,450.1 million as of February 28, 2025, from $7,753.5 million at the end of November 2024[39]. - The company expects a percentage change in adjusted earnings per share in constant currency to be between 5% and 7%[28]. - The impact of unfavorable foreign currency exchange is estimated to be 2% on earnings[28]. Growth Strategy - The company is focused on driving sustainable growth through its Consumer and Flavor Solutions segments[34].

Core Insights - McCormick & Company reported solid first quarter results for fiscal 2025, with total net sales of $1.605 billion, reflecting a 0.2% increase compared to the previous year, driven by a 2% organic sales growth despite a 2% unfavorable impact from currency [6][34]. Financial Performance - Total net sales for the Consumer segment were $919 million, consistent with the first quarter of 2024, while the Flavor Solutions segment saw sales increase to $686 million, a 1% rise from the previous year [13]. - Gross profit for the first quarter was $604 million, with a gross profit margin of 37.6%, an increase of 20 basis points from the prior year [5][8]. - Operating income was reported at $225 million, down from $234 million in the year-ago period, with adjusted operating income also at $225 million compared to $238 million previously [9][10]. Segment Performance - The Consumer segment experienced a 17% decrease in operating income, primarily due to pricing pressures and increased selling, general, and administrative costs, while the Flavor Solutions segment's operating income grew by 28% [14]. - Organic sales growth in the Consumer segment was 1%, driven by a 3% increase in volume and product mix, while the Flavor Solutions segment achieved a 3% organic sales increase [13]. Outlook for Fiscal Year 2025 - McCormick reaffirmed its fiscal 2025 outlook, expecting net sales growth of 0% to 2%, with adjusted operating income growth projected at 3% to 5% [11][26]. - The company anticipates a 1% unfavorable impact from foreign currency on sales and adjusted operating income, and a 2% impact on adjusted earnings per share [11][26]. Strategic Initiatives - The company continues to focus on cost savings initiatives through its Comprehensive Continuous Improvement (CCI) program, which is expected to support growth investments and operating margin expansion [3][11]. - McCormick is committed to enhancing its employee culture and developing future leaders to drive long-term success [4].

McCormick & Company, Incorporated MKC will release its first-quarter financial results before the opening bell on Tuesday, March 25.Analysts expect the company to report quarterly earnings at 64 cents per share, up from 63 cents per share in the year-ago period. McCormick projects quarterly revenue of $1.61 billion, compared to $1.6 billion a year earlier, according to data from Benzinga Pro.On Jan. 27, Barclays analyst Andrew Lazar maintained McCormick with an Equal-Weight rating and lowered the price targ ...

Core Viewpoint - McCormick & Company is expected to show growth in both revenue and earnings for the first quarter of 2025, with revenue estimates at nearly $1.6 billion, reflecting a 0.6% increase year-over-year, and earnings projected at 64 cents per share, indicating a 1.6% growth from the previous year [1][3]. Group 1: Growth Drivers - The company is experiencing strong growth due to increased volume and an improved product mix [3]. - Strategic initiatives such as brand marketing, innovative product and packaging solutions, and proprietary technology are enhancing McCormick's market presence [3]. - Recovery in consumer demand from China is contributing positively to the company's momentum [3]. - Cost-saving initiatives are supporting growth investments and improving operating margins [3]. Group 2: Challenges - Despite growth, McCormick faces challenges from inflationary pressures that could impact performance [4]. - Increased investments in brand marketing are raising SG&A expenses, which may affect operating leverage [4]. Group 3: Earnings Predictions - The company's earnings model suggests a likely earnings beat, supported by a positive Earnings ESP of +1.95% and a Zacks Rank of 3 (Hold) [5]. - McCormick has a trailing four-quarter earnings surprise average of 12.9%, indicating a history of exceeding earnings expectations [1][5].

Core Viewpoint - McCormick (MKC) is anticipated to report a year-over-year increase in earnings driven by higher revenues in its upcoming earnings report for the quarter ended February 2025, with the actual results being a significant factor influencing its near-term stock price [1][2]. Earnings Expectations - The consensus estimate for McCormick's quarterly earnings is $0.67 per share, reflecting a year-over-year increase of 6.4%, while revenues are projected to be $1.61 billion, up 0.6% from the previous year [3]. - The consensus EPS estimate has been revised 0.06% higher in the last 30 days, indicating a slight positive adjustment by analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model compares the Most Accurate Estimate to the Zacks Consensus Estimate, suggesting that recent analyst revisions may provide more accurate insights into the company's earnings prospects [5][6]. - A negative Earnings ESP of -2.46% for McCormick indicates that analysts have recently become more bearish on the company's earnings outlook, complicating predictions of an earnings beat [10][11]. Historical Performance - McCormick has a history of beating consensus EPS estimates, having done so in the last four quarters, including a surprise of +3.90% in the most recent quarter [12][13]. Conclusion - While McCormick does not appear to be a strong candidate for an earnings beat based on current estimates, investors should consider other factors that may influence stock performance ahead of the earnings release [16].

Company Overview - McCormick & Company, Incorporated (NYSE: MKC) is a global leader in the flavor market, offering a diverse product portfolio across consumer and flavor solutions markets [1]. Market Position - The company has effectively managed its operations and maintains a strong presence in the flavor industry, indicating robust market positioning and competitive advantages [1]. Investment Strategy - The investment approach focuses on fundamental, bottom-up analysis with an emphasis on long-term quality growth, targeting companies in niche markets with strong growth potential and sound management [1]. Portfolio Construction - The typical portfolio consists of 15-20 stocks, emphasizing diversification, risk management, macro-driven sector weights, and disciplined trading and valuations as key factors [1].

Core Insights - Sargento has launched three new products: Sargento® Natural American Cheese, Sargento® Seasoned Shredded Cheese, and Sargento® Shareables, continuing its tradition of innovation in the cheese industry [1][3][10] Product Innovations - **Sargento® Natural American Cheese**: Made with 100% natural cheese, containing only five ingredients, contrasting with typical processed cheeses that have nine or more [4][10] - **Sargento® Seasoned Shredded Cheese**: Developed in collaboration with McCormick & Co, featuring bold flavors such as Frank's RedHot® and Cholula® Hot Sauce Seasonings, catering to consumers seeking spicy options [5][7] - **Sargento® Shareables**: Convenient cheese and cracker trays designed for sharing, featuring a balanced cheese-to-cracker ratio, and available in three varieties [6][8] Strategic Partnerships - Sargento partnered with McCormick & Co, Inc. for the Seasoned Shredded Cheese line and with Mondelēz International for the Shareables, enhancing its product offerings and market reach [3][10] Market Position - Sargento has been a leader in the cheese industry for over 70 years, with a commitment to quality and innovation, and aims to grow the natural cheese category with these new products [3][11]

Core Viewpoint - McCormick (MKC) is positioned well to potentially beat earnings estimates in its upcoming quarterly report, supported by a strong history of exceeding expectations [1][4]. Group 1: Earnings Performance - McCormick has a solid track record of surpassing earnings estimates, with an average surprise of 12.98% over the last two quarters [2]. - In the last reported quarter, McCormick achieved earnings of $0.80 per share, exceeding the Zacks Consensus Estimate of $0.77 per share, resulting in a surprise of 3.90% [3]. - In the previous quarter, the company reported earnings of $0.83 per share against an expectation of $0.68 per share, delivering a significant surprise of 22.06% [3]. Group 2: Earnings Estimates and Predictions - Recent favorable changes in earnings estimates for McCormick indicate a positive outlook, with a positive Earnings ESP (Expected Surprise Prediction) suggesting a strong likelihood of an earnings beat [4][7]. - The current Earnings ESP for McCormick stands at +2.49%, reflecting increased analyst optimism regarding its near-term earnings potential [7]. - Stocks with a positive Earnings ESP and a Zacks Rank of 3 (Hold) or better have historically produced positive surprises nearly 70% of the time, indicating a high probability of beating consensus estimates [5].