Hormel Foods Corporation reported its financial results for the third quarter and the nine months ended July 28, 2024, reflecting a mixed performance compared to the previous fiscal period.
For the third quarter, net sales reached $2,898,443, a decrease of 2.2% from $2,965,000 in the same quarter of the previous year. For the nine months, net sales totaled $8,782,706, down 1.5% year-over-year. The decline in sales was primarily attributed to lower commodity export sales and reduced net sales in China. The retail segment experienced a notable decline of 6.6% in net sales for the quarter, while the foodservice segment saw a 7.1% increase.
Gross profit for the third quarter was $488,369, a slight decrease of 1.9% from the previous quarter's gross profit of $498,048. However, for the nine months, gross profit increased by 1.0% to $1,500,908 compared to $1,485,417 in the prior year. The gross profit margin remained stable for the quarter, while the international segment showed improvement in gross profit as a percentage of net sales.
Operating income for the third quarter was $236,693, up from $216,759 in the previous quarter, while for the nine months, it totaled $773,452, down from $802,009. Earnings before income taxes for the third quarter increased by 8.7% to $225,719, but decreased by 1.6% for the nine months to $755,404.
Net earnings attributable to Hormel Foods for the third quarter were $176,701, an increase of 8.6% from $162,679 in the same quarter last year. However, for the nine months, net earnings decreased to $584,842 from $597,637. The diluted earnings per share for the third quarter rose to $0.32, while for the nine months, it was $1.07, down from $1.09.
The company’s cash flow from operations for the first nine months was $858,117, an increase of 18% compared to the prior year. However, cash and cash equivalents decreased by $199,057 during the same period, primarily due to long-term debt repayments.
Strategically, Hormel Foods has been active in managing its debt, issuing $500 million in senior unsecured notes in March 2024, and repaying $950 million in maturing notes in June 2024. The company also faced legal challenges, including ongoing antitrust litigation, with settlements totaling approximately $7 million in the third quarter.
Overall, while Hormel Foods experienced growth in net earnings for the quarter, the nine-month results reflected challenges in sales and profitability, particularly in the retail segment.
About HORMEL FOODS CORP /DE/
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