McCormick beats on profit and revenue, holds full-year targets
Third-quarter earnings per share of $0.86 topped estimates by $0.10, with revenue at $2.02bn
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McCormick reported third-quarter earnings per share of $0.86, ahead of expectations by $0.10. Revenue came in at $2.02bn, above the $2.00bn forecast.
The company kept its full-year targets unchanged. McCormick still expects net sales growth of 13% to 17%, adjusted operating income growth of 16% to 20%, and adjusted earnings per share of $3.05 to $3.13.
Chairman, President and CEO Brendan M. Foley said productivity initiatives offset higher input and freight costs this quarter, and that the McCormick de Mexico acquisition added to both margin expansion and sales growth.
The combination of a beat on both revenue and earnings with an unchanged outlook suggests McCormick's cost offsets are holding even as freight and input inflation continues to weigh on packaged food makers broadly. Foley's explanation gives the reaffirmed guidance a specific basis, productivity work and the Mexico deal, rather than a general reassurance, which matters after a period in which input costs have squeezed margins across the spice and flavoring industry. Keeping the 13% to 17% sales growth range intact points to the Mexico acquisition integrating on schedule, something traders will look to confirm in coming quarters rather than treat as settled now.