Hormel Profits Rise On Flat Sales Volume |
| Wall Street Journal - Aug 25, 2011 |
Hormel Foods Corp. (HRL) Thursday said it managed to push through higher prices to consumers during the past quarter though the move hit sales growth in its key refrigerated foods segment, overshadowing a rise in profit guidance by the packaged meats specialist.
Executives said sustaining price increases to cover higher animal feed costs was a bigger threat than elevated corn costs, while the sluggish food-service market in the U.S. remained a challenge.
Hormel is the third-largest U.S. meat producer by sales, and its focus on branded products such as Spam canned pork and Jennie-O Turkey, has seen it command a higher valuation than peers.
However, its shares fell 6.6% to $26.65 after the refrigerated foods unit--its largest by revenue--suffered an unexpected drop in sales volume during the fiscal third quarter. Higher hog costs sent operating profit at the unit down 12%.
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- Posted: 2011-08-25 14:20:55
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