McCormick sales up in 3rd quar­ter

Baltimore Sun - - MARYLAND - By Lor­raine Mirabella lor­raine.mirabella@balt­

McCormick & Co. re­ported a surge in profits for the third quar­ter Fri­day as sales rose amid strong global de­mand for fla­vor­ings and healthy foods.

The Sparks-based spice maker’s in­come jumped nearly a third in the three months ended Aug. 31 to $127.7 mil­lion, from $97.6 mil­lion a year ear­lier. Earn­ing per share reached $1, up from 76 cents in 2015’s third quar­ter.

Sales for the quar­ter in­creased 3 per­cent to $1.09 bil­lion, a gain that in­cluded the in­cre­men­tal im­pact of ac­quir­ing Stubbs bar­be­cue sauces in 2015 and Gourmet Gar­den in April. New prod­ucts, ad­di­tional brand mar­ket­ing and ex­panded distri­bu­tion also helped boost sales, the com­pany said.

“We are driv­ing both sales growth and sig­nif­i­cant pro­duc­tiv­ity im­prove­ments, and ex­pect 2016 to be a record year for McCormick,” said Lawrence E. Kurz­ius, McCormick’s CEO and pres­i­dent, in the com­pany’s an­nounce­ment.

McCormick’s stock rose 2.5 per­cent Fri­day to close at $99.92 a share.

Joseph Ag­nese, an eq­uity an­a­lyst at S&P Global Mar­ket In­tel­li­gence, raised the com­pany’s stock rat­ing to “buy” from “hold” and said the com­pany’s sales gain, which would have been 6 per­cent with­out cur­rency fluc­tu­a­tions, beat es­ti­mates, thanks to strong con­sumer busi­ness in the U.S. and China.

“We see val­u­a­tion ben­e­fit­ing from fa­vor­able sales trends and cost cut­ting ef­forts,” Ag­nese said in a re­search note.

Kurz­ius said de­mand is strong both in the con­sumer seg­ment, in which McCormick sells its prod­ucts in stores, and the in­dus­trial di­vi­sion, which pro­vides fla­vor­ings to food man­u­fac­tur­ers.

Sales in the U.S. rose 8 per­cent, with strong growth in the McCormick and Lawry’s brand spices and sea­son­ings and Zatarain’s and Kitchen Ba­sics prod­ucts.

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