HSY » Topics » THE HERSHEY COMPANY ANNOUNCES RECORD SECOND QUARTER AND FIRST HALF RESULTS FROM OPERATIONS, RAISES 2005 AND 2006 OUTLOOK, AND LAUNCHES NEW PROGRAM TO ADVANCE ITS VALUE-ENHANCING STRATEGY
This excerpt taken from the HSY 8-K filed Jul 21, 2005.
HERSHEY COMPANY ANNOUNCES RECORD SECOND QUARTER AND FIRST HALF RESULTS FROM OPERATIONS,
RAISES 2005 AND 2006 OUTLOOK, AND LAUNCHES NEW PROGRAM TO ADVANCE ITS VALUE-ENHANCING
HERSHEY, Pa., July 21, 2005
The Hershey Company (NYSE:HSY) today reported record sales and earnings from
operations for the second quarter and first half ended July 3, 2005. Consolidated net
sales for the second quarter were $988,447,000, compared with $893,688,000 for the second
quarter of 2004, an increase of 10.6 percent. Net income for the second quarter of 2005
was $97,361,000, or $.39 per share-diluted, compared with $147,217,000, or $.56 per
share-diluted, for the comparable period of 2004. Results for the second quarter of 2004
include the benefit of a $61.1 million, or $.23 per share-diluted, non-cash reduction of
income tax expense resulting from adjustments to income tax contingency reserves following
the completion of prior years tax audits. Excluding this item, net income for the
second quarter of 2004 was $86,136,000, or $.33 per share-diluted; second quarter 2005
earnings per share-diluted rose 18.2 percent over this number.
Hersheys strong second
quarter results clearly show the continued momentum behind our value-enhancing strategy. A
combination of solid sales growth and improved leverage across the business system
delivered record profitability, with earnings per share-diluted from operations increasing
by 18.2 percent compared with the same period a year ago, said Richard H. Lenny,
Chairman, President and Chief Executive Officer, The Hershey Company. Organic sales
growth of 7.6 percent represented a good balance between higher net price realization and
continued new product innovation both within core confectionery and our snack platforms.
The recently acquired Mauna Loa and Grupo Lorena businesses contributed three percent to
the quarters 10.6 percent sales growth.
For the first six months of 2005,
consolidated net sales were $2,114,861,000, compared with $1,906,777,000 for the first
half of 2004, an increase of 10.9 percent. Net income for the first six months of 2005 was
$215,582,000, or $.86 per share-diluted, compared with $254,364,000, or $.97 per
share-diluted, for the first half of 2004. Excluding the one-time income tax contingency
reserve adjustment mentioned above, net income for the first half of 2004 was
$193,283,000, or $.74 per share-diluted.
Hersheys performance has
been very healthy through the first half of 2005, Lenny said. Weve delivered above-trend organic
sales growth of 8.0 percent, strengthened our marketplace leadership, and delivered
earnings per share-diluted growth from operations of 16.2 percent compared with the first
half of last year. These results have been driven by broad-based innovation, superior
retail execution and solid cost control.
Looking ahead, our second-half
seasonal programs are off to a good start. Weve recently announced several exciting
new products that further extend Hersheys iconic brands. For the year as a whole, we
expect 2005 net sales to increase at a rate somewhat above our long-term goal of 3 to 4
percent, with diluted earnings per share from operations increasing slightly above our
long-term range of 9 to 11 percent.
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