McCormick & Company, Incorporated (NYSE: MKC) – McCormick Second Quarter Results Beat Estimates; Increase outlook FY21

  • McCormick & Company Inc (NYSE: MKC) reported FY21 second quarter revenue of $ 1.56 billion, up 11% year-on-year, beating the consensus estimate of $ 1.47 billion.
  • Flavor Solutions segment sales increased 39%, driven by higher OOH product sales, additional sales resulting from acquisitions and growth in the packaged food and beverage business.
  • Gross profit was $ 614.6 million, with profit margin declining 190 basis points year-on-year to 39.5%.
  • The operating margin contracted 312 basis points yoy to 15.25%.
  • The company generated year-to-date operating cash flow of $ 229 million and ended the second quarter with $ 291.8 million in cash and cash equivalents.
  • Second quarter adjusted net income of $ 186.1 million was down 6% year-over-year.
  • Adjusted EPS of $ 0.69 exceeded the consensus estimate of $ 0.61.
  • Outlook: McCormick raised its sales growth forecast for fiscal year 21 to 11% – 13%, from 8% – 10% earlier.
  • Adjusted EPS outlook raised to $ 3 – $ 3.05 from $ 2.97 – $ 3.02 previously, versus the consensus estimate of $ 3.00.
  • For fiscal 21, the company expects another year of strong cash flow, with plans to return a significant portion to McCormick shareholders as dividends and to pay off debt.
  • Price action: MKC shares are trading down 0.72% to $ 87.68 on the last check Thursday.

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