SPARKS, MD — McCormick & Co. reported its first quarter financial earnings that matched analyst expectations, according to a filing Tuesday with the Securities and Exchange Commission.
Earnings rose one cent to 74 cents per share for the period ended Feb. 28 for the global spice company, with higher operating income offset in part by a higher tax rate and the impact of unfavorable currency prices. Adjusted earnings per share increased to 76 cents, up 2 cents.
Earnings were on par with the average analyst estimate. The low average estimate was 73 cents, and the high was 80 cents.
“Our first quarter financial results were a solid start to the year delivering profit results in line with our expectations,” said CEO Lawrence Kurzius in a statement. “Sales in our consumer segment were up from the year ago period, with strong momentum in China and the benefit of acquisitions, partially offset by the impact of a challenging retail environment in the U.K.”
The increase in earnings per share was driven by higher operating income, including the impact of special charges, offset in part by a higher tax rate and the impact of foreign currency on income from unconsolidated operations.
Sales rose 1 percent in the first quarter compared to last year’s period. The company grew sales four percent in constant currency with increases in the consumer and industrial segments.
McCormick also increased gross profit margin to 39.6 percent, up from 39.3 percent during the same period last year.
For the first quarter, operating income was $134 million compared to $129 million in the same 2016 period.
For the year to date quarter, net cash from operating activities is down significantly to $44 million from $79 million in the same period 2016 due mainly to the timing of income tax payments and incentive compensation payments related to 2016’s financial performance.
The company updated its financial outlook for 2017 to reflect a higher impact from special charges, but the company reaffirmed its expected constant currency growth rate for sales, adjusted operating income and adjusted earnings per share.
In 2017, McCormick expects to grow sales 3 percent to 5 percent compared to 2016. Operating income is expected to grow 9 to 11 percent from $641 million in 2016.
McCormick projects the 2017 earnings per share to be from $3.98 to $4.06, up from $3.69 in 2016.
McCormick stock traded Tuesday down about 2.5 percent from the day’s open at $100.
This story is from the Maryland Business News Wire, a service of UNC-Chapel Hill’s School of Media and Journalism