Hershey Reports Fourth-Quarter and Full-Year 2024 Financial Results; Provides 2025 Outlook

Core Insights - The Hershey Company reported a strong performance in Q4 2024, with consolidated net sales increasing by 8.7% to $2,887.5 million, and organic, constant currency net sales rising by 9.0% [10][13] - The company anticipates challenges in 2025 due to rising cocoa prices, projecting a reported earnings per share decline in the high-40% range, while adjusted earnings per share is expected to decrease in the mid-30% range [5][6] Financial Performance - Q4 2024 reported net income was$ 796.6 million, or $3.92 per share-diluted, marking a 130.6% increase year-over-year [10][42] - For the full year 2024, consolidated net sales reached$ 11,202.3 million, a slight increase of 0.3% compared to 2023 [10][42] - The company’s reported gross margin improved by 1170 basis points to 54.0% in Q4 2024, driven by derivative mark-to-market gains and net price realization [14][42] Segment Performance - North America Confectionery segment net sales increased by 6.0% to $2,354.2 million in Q4 2024, with organic, constant currency net sales up by 5.9% [20][43] - North America Salty Snacks segment saw a significant net sales increase of 35.9% to$ 278.9 million, with volume growth driven by inventory timing and promotional events [23][43] - International segment net sales rose by 9.8% to $254.5 million, with double-digit volume growth in key markets [26][43] Cost Management and Outlook - The company expects net sales growth of at least 2% in 2025, primarily from net price realization, but anticipates significant pressure on earnings due to higher commodity costs and tax rates [5][6] - Selling, marketing, and administrative expenses decreased by 5.5% in Q4 2024, reflecting lower compensation costs and reduced technology investments [15][43] - The effective tax rate for Q4 2024 was reported at (10.2)%, a decrease from (9.2)% in the prior year [17][42]