Hormel Foods Sales Up 20% in Record Third Quarter
Austin-based Hormel Foods Corp. is something of an outlier in Minnesota business circles. It’s one of only two Fortune 500 companies in the state that is not based in the Twin Cities metro. Although the company was founded in 1891, its latest financials make it look like a growth company.
On Thursday, Hormel reported record third-quarter results for fiscal 2021, posting sales of $2.9 billion. Overall sales were up a robust 20.2 percent for the quarter that ended on July 25. The company saw a net profit of $177.1 million for the quarter.
“Our team delivered the highest quarterly net sales result in the company’s history, with growth from every segment and all four channels,” said Jim Snee, Hormel’s chairman of the board, president, and CEO, in a statement. “This record performance demonstrates the power of our brands and our team’s ability to successfully integrate the Planters business, which is quite an accomplishment, given the difficult operating conditions again this quarter.”
In June the company closed on its $3.35 billion acquisition of the Planters snacking portfolio, the largest-ever deal in the company’s history. Beyond Planters peanuts, the deal means that Hormel products now include Cheez Balls and Corn Nuts.
The company also offered guidance on its full year results to reflect the addition of Planters products to its portfolio. Hormel expects record results in the fourth quarter as well. It now expects to record annual sales of $11 billion to $11.2 billion this year. Hormel’s fiscal year ends in October.
Ten years ago, Hormel saw sales of $7.9 billion for fiscal 2011. Hitting $11 million this year would translate into a 39 percent gain in sales over the last decade.
For the third quarter, Hormel saw sales gains across all categories of its business.
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The company implemented price increases in response to a litany of rising costs.
“We saw significant inflationary pressure in almost all areas of our business, including raw materials, packaging, freight, labor and many other inputs during the quarter,” said Snee in a statement.
Despite the strong growth in sales, Snee made it clear that it has not been easy.
“We are managing through industrywide operational challenges, including labor availability, upstream and downstream supply chain disruptions, and highly volatile and inflationary input costs,” said Snee.