Sauce and spice manufacturer, McCormick & Company, has reported year end financial results in line with their 2024 fiscal outlook.
Figures from the makers of Frank's RedHot Sauce and Old Bay, show sales in the third quarter were comparable to the same period last year, reflecting volume growth of 1%, partially offset by price.
Operating income was $287 million (€259.9 million), in the third quarter compared to $245 million (€221 million), on the same period last year, while adjusted operating income was $288 million (€260 million), compared to $251 million (€227 million). In addition, the company increased its earning per share outlook.
Well Positioned
Brendan M. Foley, McCormick's president and CEO, said the year-to-date performance was in line with company expectations, driving volume improvements and growth.
"We continue to strengthen our business across major markets and core categories by executing with speed and agility on the initiatives within our growth levers, including brand marketing, new products and packaging, category management, and proprietary technology," he said.
"Additionally, we believe we are well positioned with our cost savings initiatives to fuel investments and generate operating margin expansion. Our year to date results coupled with our growth plans reinforce our confidence in achieving the mid to high-end of our projected sales growth for 2024. Our business fundamentals are strong, and we expect to continue to deliver profitable growth and drive shareholder value.
"Overall, we remain confident in the sustained trajectory of our business, and in our ability to deliver on our 2024 outlook and long-term financial objectives. Our commitment is underpinned by our proven track record, our broad and advantaged global portfolio, our alignment with consumer trends, as well as our differentiated heat platform."
Third Quarter Results
McCormick reported sales include the impact of the company's strategic decision to divest a small canning business and reflect 1% volume growth driven by the Consumer segment, partially offset by pricing.
Gross profit margin expanded 170 basis points versus the third quarter of last year. This expansion was driven by favourable mix as well as cost savings led by the Company's Comprehensive Continuous Improvement (CCI) program.
Net cash provided by operating activities through the third quarter of 2024 was $463 million (€419 million), compared to $660 million (€597.8 million), through the third quarter of 2023. The benefit from the increase in earnings year over year was more than offset by the impacts of cash used for working capital, higher incentive compensation payments, and the timing of income tax payments.
