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Hormel Foods(HRL) - 2025 Q1 - Quarterly Results
HRLHormel Foods(HRL)2025-02-26 22:46

Financial Performance - Hormel Foods reported net sales of 2.99billionforQ1fiscal2025,withorganicnetsalesup12.99 billion for Q1 fiscal 2025, with organic net sales up 1% compared to the previous year[4]. - The company reaffirmed its fiscal 2025 net sales outlook of 11.9 billion to 12.2billionandadjusteddilutedearningspershareexpectationsof12.2 billion and adjusted diluted earnings per share expectations of 1.58 to 1.72[5].−DilutedearningspershareforQ1were1.72[5]. - Diluted earnings per share for Q1 were 0.31, with adjusted diluted earnings per share at 0.35,reflectingadecreasefromthepreviousyear[4].−NetsalesforthequarterendedJanuary26,2025,were0.35, reflecting a decrease from the previous year[4]. - Net sales for the quarter ended January 26, 2025, were 2,988,813, a decrease of 0.3% compared to 2,996,911forthesamequarterin2024[24].−Grossprofitforthequarterwas2,996,911 for the same quarter in 2024[24]. - Gross profit for the quarter was 475,232, down from 508,733intheprioryear,reflectingadecreaseof6.6508,733 in the prior year, reflecting a decrease of 6.6%[24]. - Net earnings attributable to Hormel Foods Corporation for the quarter were 170,575, a decline of 22.1% from 218,863inthesamequarterlastyear[24].−AdjustednetearningsattributabletoHormelFoodsCorporation(Non−GAAP)forthequarterwere218,863 in the same quarter last year[24]. - Adjusted net earnings attributable to Hormel Foods Corporation (Non-GAAP) for the quarter were 190,687, down from 226,763,reflectingadeclineof16.0226,763, reflecting a decline of 16.0%[36]. - The diluted earnings per share (GAAP) decreased to 0.31 from 0.40,representingadeclineof22.50.40, representing a decline of 22.5% year-over-year[38]. - The company's fiscal 2025 outlook for adjusted operating income is projected to be between 1,175 million and 1,275million[43].−HormelFoodsexpectsdilutedearningspershare(Non−GAAP)forfiscal2025torangefrom1,275 million[43]. - Hormel Foods expects diluted earnings per share (Non-GAAP) for fiscal 2025 to range from 1.58 to 1.72[43].SegmentPerformance−Thecompanyexperienceda41.72[43]. Segment Performance - The company experienced a 4% decline in volume and a 1% decrease in net sales within the Retail segment, with segment profit down 20%[9]. - In the Foodservice segment, organic volume and net sales growth were driven by strong performance in premium prepared proteins, turkey, and breakfast sausage categories[11]. - International segment growth was supported by strong sales in China, with significant contributions from SPAM and Skippy products, despite softness in Brazil[12]. - Segment profit for retail decreased by 20.3% to 119,147, while foodservice profit decreased by 7.6% to 138,826[27].−Thecompanyreporteda1.6138,826[27]. - The company reported a 1.6% increase in organic net sales for the foodservice segment, despite a 3.7% decline in retail[40]. Tax and Expenses - The effective tax rate for the quarter was 21.8%, down from 23.4% in the prior year, with expectations for the full year between 22.0% and 23.0%[16]. - The effective tax rate for the quarter was 21.8%, compared to 23.4% in the prior year[24]. - Advertising investments for the quarter were 43 million, with expectations for an increase in full-year advertising expenses compared to the prior year[16]. - Hormel Foods' SG&A as a percent of net sales (GAAP) increased to 8.8% from 8.0% year-over-year[38]. Cash Flow and Investments - Cash and cash equivalents increased to 840,398from840,398 from 741,881 at the end of the previous quarter[25]. - The company reported a net cash provided by operating activities of 309,206,downfrom309,206, down from 403,980 in the prior year[26]. - Hormel Foods plans to invest 275millionto275 million to 300 million in capital expenditures for fiscal 2025, with 72millionspentinQ1[16].StrategicInitiatives−HormelFoodsCorporationisundergoingamulti−yearTransformandModernizeinitiative,whichincludesnon−recurringcoststhatareexcludedfromadjustedperformancemeasures[29].−Thecompanyexpectsyear−over−yearbenefitsfromitsTransformandModernizeinitiativeintherangeof72 million spent in Q1[16]. Strategic Initiatives - Hormel Foods Corporation is undergoing a multi-year Transform and Modernize initiative, which includes non-recurring costs that are excluded from adjusted performance measures[29]. - The company expects year-over-year benefits from its Transform and Modernize initiative in the range of 100 million to 150million[5].−TheTransformandModernizeinitiativeisexpectedtoincurestimatedchargesof150 million[5]. - The Transform and Modernize initiative is expected to incur estimated charges of 46 million to $52 million in fiscal 2025[43].