Austin, MN, United States (AHN) – Hormel Foods (NYSE: HRL) reported Thursday fiscal first quarter earnings rose 37 percent as lower costs for its refrigerated foods went straight toward boosting the bottom line.
The packaged foods company posted first quarter earnings of $111.2 million or 82 cents a share, up from $81.4 billion or 60 cents a share in the same period a year earlier.
Hormel’s refrigerated foods unit was the largest catalyst to earnings growth with a 53 percent rise in operating profit to $70.2 billion, despite flat revenue numbers. The company said favorable spreads on hog costs benefitted the unit.
The Grocery Products unit also performed well, growing operating profit by 37 percent as sales of core products, such as SPAM and Hormel Chili increased. The company also saw sales of its Jenny-O turkey products rise 5 percent.
Total revenue companywide rose 2 percent to $1.73 billion, while gross margin added 2 points to 18 percent.
“We are pleased to report record earnings and sales for the quarter. Four of our five business segments delivered double-digit profit gains during the quarter,” said President and CEO Jeffrey M. Ettinger.
Hormel raised its full-year earnings outlook from a range of $2.63 to $2.73 a share to $2.68 to $2.78 a share.
