Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Candy maker Hershey raises sales outlook ahead of holiday season

Published 11/04/2022, 06:52 AM
Updated 11/04/2022, 09:35 AM
© Reuters. FILE PHOTO: An employee shows a Hershey's chocolate bar made in USA in the "American lifestyle" store in Berlin, Germany, August 13, 2018. REUTERS/Fabrizio Bensch

© Reuters. FILE PHOTO: An employee shows a Hershey's chocolate bar made in USA in the "American lifestyle" store in Berlin, Germany, August 13, 2018. REUTERS/Fabrizio Bensch

By Uday Sampath Kumar

(Reuters) -Hershey Co raised its annual sales and profit forecasts on Friday, signaling strong Halloween candy demand that it expects to continue into the holiday season despite higher selling prices.

Halloween is Hershey's busiest time of the year, making up about 10% of its annual revenue, with sales benefiting for months in advance as retailers place early orders to stock up on Twizzlers, Jolly Ranchers and Kit Kat bars.

After two years of pandemic restrictions on trick-or-treating, candy demand during this year's holiday is expected to have risen sharply, with the National Retail Federation (NRF) anticipating record high sales of $3.1 billion.

Hershey estimated its Halloween retail sales rose by a high-single-digit percentage, even as ingredient shortages and supply constraints curbed growth.

"We anticipate this category momentum to continue into the Holiday season, and product is already out in stores and selling well," CEO Michele Buck said.

Buck added that further price increases and new manufacturing lines were expected to boost Hershey's sales next year, but demand would likely slow as consumers become more price sensitive.

The Reese's Peanut Butter Cup maker said its overall average selling prices increased by 7.7% in the third quarter to Oct. 2, while sales volumes rose 4.1%.

It reported adjusted earnings of $2.17 per share on revenue of $2.73 billion in the same period.

Analysts had expected a profit of $2.10 per share on revenue of $2.62 billion, Refinitiv data showed.

© Reuters. FILE PHOTO: An employee shows a Hershey's chocolate bar made in USA in the

Hershey raised its 2022 net sales growth forecast to 14% to 15%, from 12% to 14%. It expects adjusted profit per share to grow by 14% to 15%, against the prior forecast of 12% to 14%.

Other packaged food makers, including Cadbury maker Mondelez (NASDAQ:MDLZ) International and Kellogg (NYSE:K) Co, have also raised their sales forecasts in recent days as they see little impact to demand from price increases.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.