Hershey has sweet outlook for 2013 based on Q2 results

HERSHEY, Pa. — Core brand growth and new products in U.S. and key international markets bolstered Hershey Company’s second quarter results for the period ended June 30. The company reported consolidated net sales of $1.5 billion for the quarter, a 6.7% increase from $1.4 billion for same quarter a year ago.

Hershey’s reported net income for the quarter was $159 million or $0.70 per share-diluted, compared with $135 million or $0.59 per share-diluted for the comparable period of 2012.

“We delivered another quarter of strong sales and earnings growth driven by solid core brand and new product performance,” said John P. Bilbrey, president and CEO, the Hershey Company. “Our intellectual capital and Insights Driven Performance program initiatives continue to provide us with a competitive advantage in the marketplace. The marketing and sales teams are working collaboratively against the same goal of winning in the marketplace. This has resulted in solid in-store execution related to core brand merchandising and programming as well as new product distribution. Combined with supply chain efficiencies, we have the financial flexibility to invest in our greatest opportunities to drive global growth and deliver on our objectives.”

Hershey’s U.S. candy, mint and gum retail takeaway for the 24 weeks ended June 15, which along with the comparable period in 2012 encompasses each year’s entire Easter season results, was up 6.8% in the expanded all outlet combined plus convenience store channels, which accounts for approximately 90% of the company’s U.S. retail business. U.S. market share was up in every channel resulting in a market share gain of 1.4 points. This performance reflects solid market share gains across many core brands including Hershey’s, Reese’s, Kit Kat and Ice Breakers as well as Brookside.

“As we enter the third quarter, we’re well-positioned to gain market share for the year in the geographies where our resources are focused,” added Bilbrey. “We’re on track to deliver another record year of solid net sales growth and a double-digit percentage increase in earnings per share-diluted. We have marketplace momentum in all segments of our U.S. business — chocolate, non-chocolate, mints and gum — and have visibility into our innovation pipeline and key line items within the income statement. The earnings growth, as well as the company’s continued focus on working capital, enables us to generate strong operating cash flow. Therefore, I’m pleased to announce an increase to our quarterly dividend.”