Vending

Hershey lifts Q3 2022 revenue, raises FY 2022 guidance

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November 4, 2022

Hershey Co. lifted its Q3 2022 revenue and raised its full-year guidance, according to an earnings released, beating analyst expectations. Highlights include:

• Consolidated net sales increased 15.6% from $2.36 billion in Q3 2021 to $2.73 billion for the quarter ending Oct. 2, 2022, including a 4.1-point benefit from the acquisitions of Pretzels and Dot's. Organic, constant currency sales increased 11.8%. List price increases along with strong consumer demand and favorable price elasticities drove balanced growth across segments.
• Net income fell 9.3% from $444.9 million to $399.5 million in the comparative quarters.
• Basic income per share fell from $2.22 to $2.00 while diluted income per share fell from $2.14 to $1.94.
• Adjusted earnings per share rose 33% to $2.17.
• The North America confectionery segment net sales rose 10.4% to $2.24 billion. Organic, constant currency net sales increased 10.7% while net price realization was driven by mid to high single-digit list price increases across the confectionery portfolio. Earlier seasonal shipments versus the prior-year period and continued replenishment of distributor inventory levels offset modest declines in consumer demand to drive volume growth.
• The North America salty snacks segment net sales rose 86.9% to $275 million. Sales from the acquisitions of Dot's and Pretzels were a 65.5-point benefit while organic, constant currency net sales growth was 21.4% driven by volume gains from strong consumer demand and net price realization.
• The international segment sales increased 15.4% to $217.6 million. Organic, constant currency net sales increased 16.6% driven by higher volumes from strong consumer demand and net price realization.

Shares traded today at $230.79 against a 52-week range of $173.12-$241.48.

The $2.73 billion in quarterly revenue beat analyst expectations by $110 million while the non-GAAP EPS of $2.17 beat expectations by 7 cents, according to Seeking Alpha.

The company declared a $1.036 dividend payable Dec. 15 to shareholders of record Nov. 18.

"Third quarter results came in ahead of our expectations, as our increased brand investments and improved supply chain helped support resilient consumer demand and drove category growth across all business segments," CEO Michele Buck said in the press release. "Marketplace share and gross margin trends improved versus the second quarter, and we have strong momentum exiting the year. Given our performance to date and visibility into the fourth quarter, we are raising our net sales and earnings outlook for the year."

The company raised both its full year sales growth outlook and adjusted EPS outlook from 12%-14% to 14%-15%.