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McCormick
🇺🇸 NYSE:MKC
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OverviewEarningsDividends
•
May 31, 2020

McCormick Q2 2020 Earnings Report

Reported strong sales and profit growth driven by consumer segment.

Key Takeaways

McCormick reported an 8% sales increase in the second quarter from the year-ago period. In constant currency total sales grew 10% with significant consumer segment growth partially offset by a substantial sales decline in the flavor solutions segment. Earnings per share was $1.46 in the second quarter as compared to $1.12 in the year-ago period. Adjusted earnings per share rose 27% to $1.47 from $1.16 in the year-ago period.

Sales rose 8% in the second quarter from the year-ago period.

Operating income increased 24% to $257 million.

Earnings per share was $1.46 as compared to $1.12 in the year-ago period.

Adjusted earnings per share rose 27% to $1.47 from $1.16 in the year-ago period.

Total Revenue
$1.4B
Previous year: $1.3B
+7.6%
EPS
$0.74
Previous year: $0.58
+27.6%
Gross Profit
$580M
Previous year: $509M
+14.0%
Cash and Equivalents
$185M
Previous year: $139M
+32.7%
Free Cash Flow
$262M
Previous year: $182M
+44.1%
Total Assets
$10.6B
Previous year: $10.2B
+3.3%

McCormick

McCormick

McCormick Revenue by Segment

Forward Guidance

The company believes there will be a shift in demand due to COVID-19 for the balance of the year but cannot predict the level of consumption at home or away from home, or the impact of possible resurgences of the COVID-19 virus. The company is focused on execution and is ready to perform in this dynamic environment as it has thus far. The company reaffirms its long-term financial objectives and capital allocation priorities remain unchanged.

Positive Outlook

  • Expecting an overall increase in consumer demand driven by increased cooking at home.
  • Continues to see elevated demand as the second half of the fiscal year begins.
  • Expecting customer demand from packaged food companies to be consistent with levels prior to COVID-19.
  • Restaurant and other foodservice customers are beginning to recover.
  • Demand from restaurant and other foodservice customers to rebound gradually throughout the second half of the fiscal year.

Challenges Ahead

  • Cannot predict the level of consumption at home or away from home.
  • Cannot predict the impact of possible resurgences of the COVID-19 virus.
  • High degree of uncertainty about the pace and shape of the COVID-19 recovery.
  • Not providing new fiscal 2020 guidance at this time.
  • Demand from restaurant and other foodservice customers not return to the same level as the year-ago period.

Revenue & Expenses

Visualization of income flow from segment revenue to net income

Company Overview

Full financial data and analysis

View McCormick