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McCormick
🇺🇸 NYSE:MKC
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May 31, 2022

McCormick Q2 2022 Earnings Report

McCormick's second quarter results were impacted by discrete items, including COVID-related lockdowns in China and the conflict in Ukraine.

Key Takeaways

McCormick reported a 1% sales decline in the second quarter, but constant currency sales were comparable to the previous year, reflecting 7% growth from pricing actions offset by a 7% decline in volume and product mix. Operating income decreased to $157 million, and earnings per share was $0.44. The company updated its 2022 outlook to reflect these challenges.

Sales declined 1% in the second quarter, but were comparable in constant currency.

Operating income was $157 million, down from $237 million in the year-ago period.

Earnings per share was $0.44, compared to $0.68 in the previous year.

McCormick updated its 2022 outlook to reflect a more unfavorable impact of foreign currency rates, higher cost pressures, and significant disruption in China from COVID-related lockdowns.

Total Revenue
$1.54B
Previous year: $1.56B
-1.3%
EPS
$0.48
Previous year: $0.69
-30.4%
Gross Profit
$523M
Previous year: $615M
-14.9%
Cash and Equivalents
$326M
Previous year: $292M
+11.7%
Free Cash Flow
$78.6M
Previous year: $197M
-60.0%
Total Assets
$13B
Previous year: $12.8B
+1.2%

McCormick

McCormick

McCormick Revenue by Segment

Forward Guidance

McCormick updated its financial outlook for fiscal year 2022 to reflect a more unfavorable impact of foreign currency rates, the impact of higher cost pressures and the related pricing actions, the unfavorable impact of significant disruption in China from COVID-related lockdowns and the conflict in Ukraine. The Company expects sales to grow 3% to 5% compared to 2021. Adjusted earnings per share is expected to be in the range of $3.03 to $3.08.

Positive Outlook

  • Sales growth to be driven by pricing actions.
  • Cost savings are expected to offset inflationary pressures over time.
  • Continued growth through the strength of its brands.
  • Brand marketing, new products, category management, and differentiated customer engagement.
  • Strong cash flow is expected.

Challenges Ahead

  • Unfavorable impact of foreign currency rates.
  • Impact of higher cost pressures.
  • Unfavorable impact of significant disruption in China from COVID-related lockdowns.
  • Conflict in Ukraine.
  • Adjusted earnings per share outlook represents an expected decline of 1% to an increase of 1%.

Revenue & Expenses

Visualization of income flow from segment revenue to net income

Company Overview

Full financial data and analysis

View McCormick