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Aug 31, 2023
McCormick Q3 2023 Earnings Report
McCormick reported strong performance driven by sustained demand and effective execution of growth strategies.
Key Takeaways
McCormick & Company reported a 6% increase in sales for the third quarter, with operating income rising to $245 million. Earnings per share were reported at $0.63, and the company reaffirmed its fiscal year 2023 sales and operating profit outlook while increasing its adjusted earnings per share outlook.
Sales increased 6% in the third quarter from the year-ago period.
Operating income was $245 million in the third quarter compared to $235 million in the year-ago period.
Earnings per share was $0.63 in the third quarter as compared to $0.82 in the year-ago period.
Cash flow from operations through the third quarter of 2023 was $660 million compared to $250 million in the year-ago period.
McCormick
McCormick
McCormick Revenue by Segment
Revenue by Segment
Consumer Revenue
CapyFin.comFlavor Solutions Revenue
CapyFin.com Forward Guidance
For fiscal year 2023, McCormick reaffirmed its sales and operating income outlook and increased its adjusted earnings per share outlook.
Positive Outlook
- Strong underlying business performance in 2023 driven by sales growth.
- Favorable impact to operating income from its GOE program.
- Lapping of the negative impact of the COVID-related disruptions in China in 2022.
- Sales growth to be driven primarily by pricing actions which, in conjunction with cost savings, are expected to offset inflationary pressures.
- Drive continued growth through the strength of its brands, as well as brand marketing, new products, category management, and differentiated customer engagement plans.
Challenges Ahead
- Lower than previously expected benefit from lapping the COVID-related disruptions in China.
- Partially offset by the Kitchen Basics divestiture and an expected increase in employee incentive compensation expenses.
- Earnings per share growth will be tempered by higher interest expense.
- Higher projected effective tax rate compared to 2022.
- Approximately $55 million of special charges in 2023 that relate to previously announced organizational and streamlining actions.
Revenue & Expenses
Visualization of income flow from segment revenue to net income