Hormel Foods Reports Fourth Quarter and Full-Year Fiscal 2024 Results
Hormel Foods Corporation, a global branded food company, has released its fourth quarter and full-year fiscal 2024 results. The company reported strong financial performance, driven by its value-added portfolio and the benefits from its Transform and Modernize (T&M) initiative.
Financial Highlights
For fiscal 2024, Hormel Foods reported net sales of $11.9 billion and an operating income of $1.1 billion. The company achieved a record operating cash flow of $1.3 billion. Diluted earnings per share (EPS) were $1.47, with an adjusted EPS of $1.58. The effective tax rate for the year was 22.3%.
In the fourth quarter, net sales were $3.1 billion, with an operating income of $294 million. The company reported a diluted EPS of $0.40 and an adjusted EPS of $0.42. Cash flow from operations for the quarter was $409 million.
Business and Operational Highlights
Hormel Foods' retail segment saw a 29% increase in segment profit, driven by strong performance from brands like Hormel® Black Label®, Jennie-O®, SPAM®, and Applegate®. The foodservice segment achieved above-industry growth, while the international segment showed significant recovery, particularly in China and branded exports.
Despite challenges such as a steep decline in whole bird turkey commodity markets and production disruptions at the Suffolk, Virginia facility, the company managed to offset these with the $75 million operating income benefit from the T&M initiative.
Strategic Initiatives and Corporate Developments
The T&M initiative has been a significant driver of Hormel Foods' performance, contributing $75 million in operating income benefits in fiscal 2024. The company expects to realize an additional $100 million to $150 million in benefits from this initiative in fiscal 2025. Hormel Foods also announced a 3% increase in its dividend, marking the 59th consecutive year of annual dividend growth.
Management's Perspective
Jim Snee, chairman of the board, president, and CEO, highlighted the solid execution of the company's strategy and the resilience of its team. He emphasized the strong growth in the retail and foodservice segments and the recovery in international markets. Snee also noted the record operating cash flow and the company's commitment to returning capital to shareholders through dividends.
Future Outlook
Looking ahead to fiscal 2025, Hormel Foods expects net sales to be in the range of $11.9 billion to $12.2 billion, with organic net sales growth of 1% to 3%. The company anticipates operating income between $1.13 billion and $1.23 billion, with adjusted operating income ranging from $1.18 billion to $1.28 billion. Diluted EPS is projected to be between $1.51 and $1.65, with adjusted EPS between $1.58 and $1.72.
SEC Filing: HORMEL FOODS CORP /DE/ [ HRL ] - 8-K - Dec. 03, 2024