Fourth-quarter profit higher at McCormick & Co.

Posted: 7:03 pm Thu, January 28, 2010
By Associated Press

McCormick & Co. Inc. said Thursday that its fiscal fourth-quarter profit increased, helped by cost-control measures and an acquisition that continued to boost sales.

The Sparks-based spice giant plans to continue to promote its products this year, emphasizing value and convenience, and expects its 2010 earnings in range of analysts’ expectations.

McCormick’s fourth-quarter profit grew 41 percent to $116.4 million, or 87 cents per share, for the three months ended Nov. 30. That compares with a profit of $82.5 million, or 62 cents per share, in the prior-year period.

Removing restructuring charges and other items, earnings were 91 cents per share.

This met the expectations of analysts surveyed by Thomson Reuters, whose estimates usually exclude one-time items.

Sales edged up 2 percent to $924.5 million from $906.9 million, with much of the growth coming from its July 2008 acquisition of Lawry’s. But the performance missed Wall Street’s estimate of $952.8 million.

McCormick managed to lower its costs by $42 million in the quarter and said it used some of those savings to increase marketing efforts for its brands. The company said it will continue to boost its marketing efforts in 2010, while pushing new products that offer value and convenience to consumers.

Many shoppers have tightened their spending during the recession and have concentrated their food-related purchases on basics and value-oriented items.

For the year, earnings climbed 17 percent to $299.8 million, or $2.27 per share, compared with $255.8 million, or $1.94 per share, in the previous year.

Adjusted profit was $2.35 per share.

McCormick said it was the fourth straight year that it had reported a double-digit increase in its full-year earnings per share results. Annual sales edged up 0.3 percent to $3.19 billion from $3.18 billion.

The company predicts a 2010 adjusted profit of $2.49 to $2.54 per share. It anticipates 2010 sales growth of 4 percent to 6 percent, which would suggest revenue of about $3.32 billion to $3.38 billion based on 2009’s sales of $3.19 billion.

Analysts expect full-year earnings of $2.52 per share on sales of $3.38 billion.

Shares closed Thursday down $1.09 to $36.45 on the New York Stock Exchange.