McCormick has 16% rise in profits for quarter, year

January 12, 1993|By Ross Hetrick | Ross Hetrick,Staff Writer

McCormick & Co. Inc. announced yesterday that its earnings for the quarter and year just ended jumped more than 16 percent -- an increase the company plans to continue by cutting costs and broadening its international market.

It was the fifth year in a row that income from continuing operations has increased by more than 15 percent at the Sparks-based spice and flavorings company.

"We see no end in sight," said James A. Hooker, vice president and chief financial officer for McCormick. "The world is out there in a very big way."

McCormick has been a darling of the stock market, with its stock increasing sixfold over the past five years. Yesterday, the stock closed at $26 a share, unchanged.

For the fiscal quarter that ended Nov. 30, the company reported income rose 16.2 percent, to $35 million, or 43 cents a share, compared with earnings of $30 million, or 37 cents a share, a year earlier. Sales rose to $452.2 million in the quarter, from $429.9 million last year.

For the full fiscal year, the company earned $95.2 million, or $1.16 a share, on sales of $1.5 billion. The results included a gain from the sale of the company's industrial cleaning business of $1.9 million, or 2 cents a share.

Excluding that one-time gain, earnings per share for the year increased by 16.3 percent. Income in the previous year was $80.9 million, or 98 cents a share, on sales of $1.4 billion.

Mr. Hooker said the company planned to continue this performance by expanding its markets in Asia, Europe and South America and cutting costs by 10 percent over the next four years.

Savings would stem from such things as better use of plant capacity and improvements in access to spice sources, he said.

Camille E. Humphries, a stock analyst with Alex. Brown & Sons Inc., said the Baltimore-based investment banking firm expects earnings per share at McCormick to increase by 15 to 20 percent a year during the next several years.

Various food trends would also help McCormick, according to David S. Leibowitz, senior vice president for American Securities Corp., a New York stock brokerage.

More couples are entertaining at home, and ethnic restaurants, which use more spices, are becoming more popular, he noted.

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