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McCormick
🇺🇸 NYSE:MKC
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Feb 28, 2022

McCormick Q1 2022 Earnings Report

McCormick delivered solid financial results aligned with expectations, growing constant currency sales by 4% and reiterating the 2022 outlook.

Key Takeaways

McCormick reported a 3% sales increase in the first quarter, with constant currency sales growing by 4%. The Consumer segment sales declined by 2%, while the Flavor Solutions segment sales increased by 12%. Earnings per share was $0.57, and adjusted earnings per share was $0.63. The company reiterated its 2022 financial outlook.

Sales rose 3% in the first quarter from the year-ago period; constant currency sales grew 4%.

Operating income was $207 million; adjusted operating income was $227 million.

Earnings per share was $0.57; adjusted earnings per share was $0.63.

McCormick reiterated its sales, operating income, and earnings per share outlook for fiscal year 2022.

Total Revenue
$1.52B
Previous year: $1.48B
+2.7%
EPS
$0.63
Previous year: $0.72
-12.5%
Gross Profit
$560M
Previous year: $578M
-3.0%
Cash and Equivalents
$338M
Previous year: $256M
+32.1%
Free Cash Flow
-$25.8M
Previous year: -$80.8M
-68.1%
Total Assets
$12.9B
Previous year: $12.7B
+2.0%

McCormick

McCormick

McCormick Revenue by Segment

Forward Guidance

For the 2022 fiscal year, McCormick reiterated its financial outlook for sales, operating income and earnings per share.

Positive Outlook

  • McCormick expects to grow sales by 3% to 5% compared to 2021, which in constant currency is 4% to 6%.
  • Sales growth is expected to be driven by brand marketing, new products, category management and differentiated customer engagement.
  • Pricing actions, which in conjunction with cost savings, are expected to offset anticipated inflationary pressures.
  • Operating income in 2022 is expected to grow by 13% to 15% from $1.02 billion in 2021.
  • Adjusted operating income is expected to increase 7% to 9%, which in constant currency is 8% to 10%.

Challenges Ahead

  • The Company anticipates integration expenses related to the FONA acquisition of approximately $3 million in 2022.
  • McCormick expects approximately $30 million of special charges in 2022 that relate to previously announced organization and streamlining actions.
  • The Company expects integration expenses, as well as special charges, to lower earnings per share by $0.10 in 2022.
  • McCormick projects 2022 earnings per share to be in the range of $3.07 to $3.12, compared to $2.80 of earnings per share in 2021.
  • This reflects strong operating growth, partially offset by a 3% headwind from an anticipated increase in the Company's projected adjusted effective tax rate.

Revenue & Expenses

Visualization of income flow from segment revenue to net income

Company Overview

Full financial data and analysis

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