Hershey(US:HSY)2025-05-01 10:47Financial Performance - Consolidated net sales for Q1 2025 were $2,805.4 million, a decrease of 13.8% compared to Q1 2024[6] - Reported net income was $224.2 million, or $1.10 per diluted share, reflecting a decrease of 71.7% year-over-year[6] - Adjusted earnings per share-diluted were $2.09, down 31.9% from the previous year[6] - Reported net income for Q1 2025 was $224.2 million, down from $797.5 million in Q1 2024, with diluted EPS of $1.10 compared to $3.89 in the prior year[45] - Non-GAAP net income for Q1 2025 was $425.4 million, compared to $628.3 million in Q1 2024, with non-GAAP diluted EPS of $2.09 versus $3.07[35] - Operating profit decreased significantly by 65.1% to $369,221 from $1,058,100 year-over-year[48] - The company reported a 67.2% decrease in income before income taxes, down to $323,654 from $986,258[48] Segment Performance - North America Confectionery segment net sales decreased 15.0% to $2,300.1 million, with organic, constant currency net sales down 15.2%[23] - North America Salty Snacks segment net sales increased 1.0% to $277.8 million, driven by a 4-point volume increase[26] - International segment net sales decreased 15.9% to $227.5 million, with organic, constant currency net sales down 7.9%[28] - The International segment reported a profit of $28.7 million in Q1 2025, a decrease of $14.1 million from the prior year, with a segment margin of 12.6%, down 320 basis points[29] - Total segment income declined by 25.5% to $766,953, with North America Confectionery segment income down 26.6% to $696,374[48] - Segment income as a percentage of net sales for North America Confectionery decreased to 30.3% from 35.0% year-over-year[48] Cost and Expenses - Reported gross margin was 33.7%, down from 51.5% in Q1 2024, primarily due to higher commodity and manufacturing costs[18] - Selling, marketing, and administrative expenses decreased 9.6% in Q1 2025 compared to the same period last year[19] - Hershey's unallocated corporate expense in Q1 2025 was $158.8 million, a decrease of $9.9 million or 5.9% compared to Q1 2024, driven by lower compensation and benefit costs[31] - The company reported a non-GAAP operating profit margin of 21.7% in Q1 2025, down from 26.5% in Q1 2024[37] - Hershey incurred business realignment costs of $16.4 million in Q1 2025, reflecting ongoing restructuring efforts[45] - Costs associated with business realignment initiatives rose by 55.1% to $25,854, indicating ongoing restructuring efforts[48] Future Outlook - The company expects full-year net sales growth of at least 2%, with reported earnings per share projected to decline in the high-40% range[8] - Tariff expenses for Q2 2025 are estimated to be between $15 million and $20 million[11] - The company is focused on enhancing long-term profitability through initiatives like the Advancing Agility & Automation Initiative, aimed at optimizing costs and processes[40] Balance Sheet and Liquidity - Cash and cash equivalents increased to $1,515,252 from $730,746, reflecting a strong liquidity position[50] - Total assets rose to $13,967,764, up from $12,946,861, indicating growth in the company's asset base[50] - Long-term debt increased significantly to $5,177,251 from $3,190,210, suggesting higher leverage[50]