McCormick shares slip on lower forecast

Earnings flat in third quarter as revenue grows on acquisition

September 26, 2013|The Baltimore Sun

Shares in McCromick & Co. Inc. slipped 2.2 percent Thursday after the Sparks-based spice maker lowered its forecast for its 2013 fiscal year, citing weak demand from consumers and restaurants.

Its stock dipped $1.49 to $66.56 a share in New York Stock Exchange trading.

The forecast was included in McCormick's earnings report for its third quarter ended Aug. 31. The company reported its quarterly earnings were flat year-over-year at $104.4 million, or 78 cents per share.

Revenue grew 3.9 percent to just over $1 billion in the quarter, up from $978 million a year earlier. Much of that growth came from its acquisition of Wuhan Asia-Pacific Condiments Co. Ltd. in May.

In its forecast, the company said it now expects sales growth for the fiscal year to fall at the lower end of the 4 to 6 percent it projected earlier, while operating income is projected to grow 3 to 5 percent, compared to an earlier forecast of 5 to 7 percent.

McCormick also said it would take a $20 million charge in the fourth quarter to pay for a previously announced lump sum payout program offered to former U.S. employees with deferred vested pension benefits.

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