WASHINGTON (dpa-AFX) - McCormick & Company, Incorporated (MKC) announced, excluding the impact of special charges, it has greater confidence in achieving the higher end of its projected growth range for sales and earnings per share for the 2016 fiscal year. Excluding the impact of special charges, the projected range for adjusted earnings per share in 2016 remains $3.68 to $3.75.
However, the company adjusted its projected 2016 earnings per share to a range of $3.63 to $3.70 from the previous range of $3.65 to $3.72 to reflect the increase in estimated special charges. The estimated impact of special charges in 2016 has increased by $0.02 to $0.05.
For the 2016 fiscal year, McCormick & Company expects to grow sales 1% to 3%, and excluding the estimated impact of unfavorable currency rates, the projected growth rate is 4% to 6%. The company said, with the acquisition in April 2016 of Gourmet Garden, it has greater confidence in achieving the higher end of its projected sales growth range.
For the second quarter ended May 31, 2016, McCormick reported earnings per share of $0.73 compared to $0.65 in the year-ago period. Excluding the impact of special charges, adjusted earnings per share was $0.75 in the second quarter of 2016 compared to $0.75 in the year-ago period. On average, ten analysts polled by Thomson Reuters expected the company to report profit per share of $0.74 for the quarter. Analysts' estimates typically exclude special items.
McCormick reported a 4% sales increase to $1.06 billion in the second quarter from the year-ago period, which included an unfavorable impact of 2% from foreign currency exchange rates. Acquisitions added 3% to the sales increase, including the incremental impact of Drogheria & Alimentari and Stubbs, purchased in 2015, and Gourmet Garden, purchased in 2016. In constant currency, the company grew sales 6%. Analysts expected revenue of $1.06 billion, for the quarter.
Lawrence Kurzius, CEO, stated, 'McCormick's second quarter results continued the strong performance we had in the first quarter of fiscal year 2016. Underpinning our growth is the rise in consumer demand for healthy flavor and high quality products, and we are meeting this demand with an expanding portfolio of on-trend products. In the second quarter, we introduced a number of new products and were pleased to expand our portfolio with the acquisition of Gourmet Garden, a leader in chilled, convenient herbs. In addition to higher sales, we significantly increased second quarter gross profit margin.'
For the second quarter ended May 31, 2016, gross profit margin rose to 40.7% from 39.4% in the second quarter of 2015.
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