Hormel Foods Profit Up on Strong Jennie-O Demand
Hormel Foods, which makes Spam and other meat products, said Tuesday its fourth-quarter profit rose 12 percent on strong revenue growth in its Jennie-O Turkey Store and refrigerated foods segments.
Earnings increased to $101.2 million, or 73 cents per share, for the three months ended Oct. 28 from $90 million, or 64 cents per share, in the prior year.
Quarterly revenue rose 6 percent to $1.66 billion from $1.56 billion in the previous year.
Excluding gains of 3 cents per share from the sale of a company plane and the disposition of the Patak joint venture, Hormel earned 70 cents per share in the latest period.
Analysts polled by Thomson Financial expected net income of 65 cents per share on slightly higher sales of $1.67 billion. The earnings estimates typically exclude one-time items.
Jennie-O Turkey Store revenue rose to $336.9 million from $316 million and refrigerated foods revenue increased to $850.6 million from $787.6 million in the quarter.
In an interview with CNBC, Hormel CEO Jeff Ettinger called the company's sales growth "excellent for the food industry."
Total expenses dropped to $231.5 million from $232.1 million, despite higher input costs.
"We are very pleased that our balanced business model allowed us to overcome a lot of those higher costs," Ettinger told CNBC.
Hormel forecast 2008 earnings between $2.30 and $2.40 per share, compared with Wall Street's $2.32 per share consensus estimate. Hormel doesn't plan to issue further quarterly profit guidance.
forecast 2008 earnings between $2.30 and $2.40 per share, compared with Wall Street's $2.32 per share consensus estimate. Hormel doesn't plan to issue further quarterly profit guidance.
CNBC.com contributed to this article.