McCormick's net rises 27% helped by sale of division

June 16, 1992

A gain on the sale of an industrial cleaning business helped push McCormick & Co. Inc.'s earnings up 27 percent for the quarter that ended May 31.

The spice company, based in Sparks, said yesterday that it had sold a Texas division that sold cleaning supplies to restaurants. The sale price of $4.3 million was about $2 million more than McCormick paid for the division. The sale added 2 cents a share in earnings.

McCormick reported the higher earnings compared with last year's second quarter despite sales that were up only 1.2 percent and higher selling, administrative, tax and interest costs.

James A. Hooker, chief financial officer, said sales in Canada have been weak because of the recession there but that price increases and improvements in unit sales elsewhere made up for the problems to the north.

McCormick's gross profit margin rose to 38 percent from 35 percent in last year's second quarter because the company sold a frozen-chicken business last year that had lower margins, Mr. Hooker said.

McCormick's stock fell 25 cents to close at $22.50 in over-the counter trading after the earnings were released yesterday.

Three months ended 5/31/91

.. .. .. .. Revenue .. .. Net .. .. .. Share

'92 .. 336,643,000 .. 18,948,000 .. 0.23

'91 .. 332,567,000 .. 14,942,000 .. 0.18

% change .. +1.2 .. .. .. +26.8 .. .. +27.8

Six months ended 5/31/91

.. .. .. Revenue .. .. .. Net .. .. .. Share

'92 .. 658,898,000 .. 36,272,000 .. 0.44

'91 .. 656,128,000 .. 30,130,000 .. 0.36

% change .. +0.4 .. .. .. +20.4 .. .. +22.2

Survival Technology Inc.

This Rockville-based high-technology medical company reported lower earnings for the third quarter and first nine months of its fiscal year.

Jeffrey W. Church, vice president of finance and chief financial officer, explained that tax loss carry-forwards last year inflated the company's third-quarter earnings. Excluding that extraordinary item, he said,

third-quarter earnings would have been up slightly this year from $442,000 in 1991.

Mr. Church said a sharp increase in military orders for the company's automatic-injector nerve-gas antidote kits boosted 1991 sales.

Like other companies that do business with the Defense Department, Survival Technologies is trying to expand its commercial business as Pentagon spending declines.

Sales of commercial products more than doubled, to $9.6 million, in the third quarter and increased more than 80 percent, to $25.2 million, in the first nine months of fiscal 1992.

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