WASHINGTON (dpa-AFX) - Value-added spices and flavor solutions provider McCormick & Co., Inc. (MKC) posted lower second-quarter net income of $78.6 million, or $0.59 a share, compared with $80.4 million, or $0.60 a share, last year. On average, 14 analysts polled by Thomson Reuters expected earnings per share of $0.61 for the quarter. Analysts' estimates typically exclude one-time items. The recent quarter's per-share earnings included $0.02 of transaction costs related to the completion of the WAPC acquisition
McCormick's quarterly net sales went up 2% year-on-year to $1.0 billion, from $984.0 million, and rose 3% in local currency. Analysts estimated revenues of $1.01 billion for the quarter. According to the company, higher volume and product mix for the consumer business drove much of this increase, and was the result of product innovation, effective brand marketing support and distribution gains. As anticipated, industrial sales were down slightly.
The company sees third-quarter earnings per share to be comparable to the year-ago result of $0.78. The favorable impact of higher sales and CCI cost savings are expected to be largely offset by a year-on-year increase in brand marketing support, retirement benefit expenses and the tax rate.
For the full year, earnings per share are now projected to be in the range of $3.13 - $3.19. As indicated early in 2013, included in the company's projected 2013 earnings per share is a year-on-year rise in the tax rate and retirement benefit expenses, which are expected to reduce earnings per share $0.23 and lower the growth rate by 8 percentage points. Excluding these factors, the company expects to grow underlying earnings per share at a double-digit rate in 2013. Analysts anticipate annual earnings of $3.20 a share.
Looking ahead to 2013, McCormick adjusted its outlook to reflect the addition of WAPC and the latest projection for its industrial business. With the addition of WAPC, McCormick increased its projected fiscal 2013 sales growth by one percentage point, and now expects to grow sales 4% - 6%.
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