Tootsie Roll Q4 2020 Earnings Report
Key Takeaways
Tootsie Roll Industries reported a decrease in net sales but an increase in net earnings for the fourth quarter of 2020. Net sales decreased by 5% to $127.87 million, while net earnings increased to $14.95 million, with earnings per share rising to $0.23.
Net sales for Q4 2020 were $127.87 million, a 5% decrease compared to Q4 2019.
Net earnings for Q4 2020 increased to $14.95 million, compared to $14.56 million in Q4 2019.
Earnings per share for Q4 2020 increased to $0.23, up from $0.22 in Q4 2019.
The Covid-19 pandemic adversely impacted sales due to changes in consumer behavior and reduced access to certain trade channels.
Tootsie Roll
Tootsie Roll
Forward Guidance
Tootsie Roll Industries is unable to determine the effects of Covid-19 pandemic on sales and net earnings in 2021 and beyond.
Positive Outlook
- The Company continues to make progress in recovering the sales decline caused by the Covid-19 pandemic.
- Sales decline was narrowed to 5% in fourth quarter 2020 when compared to the corresponding quarterly periods in 2019.
- The company is focused on the longer term and therefore are continuing to make investments in plant manufacturing operations to meet new consumer and customer demands.
- The company is focused on achieving product quality improvements.
- The company is focused on increasing operational efficiencies and provide genuine value to consumers.
Challenges Ahead
- The effects of Covid-19 pandemic are unprecedented, and therefore the Company is unable to determine its effects on sales and net earnings in 2021 and beyond.
- Fourth quarter sales were adversely impacted by the effects of the Covid-19 pandemic, which continues to curtail and limit access to certain channels of trade where the Company has historically sold its products.
- Response to this pandemic has resulted in the disruption and changes in lifestyles, shopping habits, daily work routines, and consumer behaviors, all of which have adversely affected planned consumer purchases of the Company’s products for “sharing” and “give away” occasions.
- Many of the Company’s products are consumed at group events, outings, and other gatherings which have been significantly curtailed or in some cases eliminated due to concern of possible infection or spreading of the Covid-19 virus.
- Impulse purchases of Company products at retail outlets have also been adversely affected by these changes in consumer behavior.