McCormick & Co’s share in pre-conference trading plunged 5.6% as the spice and spice mix company reported lower-than-expected second-quarter earnings and an unexpected drop in sales.
It also cut estimates for the year as a whole, citing persistently high inflation and supply chain challenges.
Net income for the quarter ended May 31 fell to $ 118.5 million, or 44 cents a share, from $ 183.7 million, or 68 cents a year, a year earlier.
Excluding extraordinary items, adjusted earnings per share were at 48 cents, lower than estimates at 65 cents.
Sales fell 1.3% to $ 1.54 billion, while convergent estimates spoke of a slight increase to $ 1.61 billion, as sales in the consumer segment fell below estimates.
The cost of goods sold increased more than sales, by 7.6% to $ 1.01 billion as the gross margin shrank to 34% from 39.5%.
For the year 2022, the company confirmed estimates for sales growth of 3% -5%, but downgraded earnings per share estimates to $ 3.03-3.08.
For the year 2022, the company confirmed the estimates for sales increase by 3% -5%, but downgraded the estimates for adjusted earnings per share to $ 3.03-3.08, from the previous one for 3.17- $ 3.22.
Source: Capital
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