Hormel Foods Reports Second Quarter Fiscal 2025 Results

Hormel Foods Corporation, a global branded food company, has released its financial results for the second quarter of fiscal 2025, which ended on April 27, 2025. The company reported solid top-line growth and provided an updated outlook for the fiscal year.

Financial Highlights

For the first half of fiscal 2025, Hormel Foods reported net sales of $5.89 billion, a 1% increase in organic net sales compared to the same period in fiscal 2024. Operating income was $477 million, with an adjusted operating income of $519 million. The company achieved an operating margin of 8.1% and an adjusted operating margin of 8.8%. Earnings before income taxes were $449 million, with adjusted earnings before income taxes of $491 million. The effective tax rate was 21.9%, and diluted earnings per share (EPS) were $0.64, with adjusted diluted EPS of $0.70. Cash flow from operations was $366 million.

In the second quarter alone, net sales were $2.90 billion, with organic net sales up 1%. Operating income was $248 million, and adjusted operating income was $265 million. The operating margin stood at 8.6%, with an adjusted operating margin of 9.1%. Earnings before income taxes were $230 million, with adjusted earnings before income taxes of $247 million. The effective tax rate was 22.0%, and diluted EPS was $0.33, with adjusted diluted EPS of $0.35. Cash flow from operations was $56 million.

Business and Operational Highlights

Hormel Foods saw notable performance in several areas:

• The Applegate® brand outperformed the total edible category in consumption growth and gained households.
• The Jennie-O® ground turkey business experienced significant retail sales growth.
• The Mexican foods portfolio delivered strong year-over-year growth, driven by double-digit consumption growth in Wholly® and Herdez® refrigerated guacamole products.
• The Foodservice segment showcased innovative products like the Fontanini® hot honey sliced sausage and Flash 180™ chicken.
• The in-country China business performed well, driven by customer and distribution expansion and new product offerings.
• The Planters® brand saw sequential improvement in both distribution and overall retail sales.

Strategic Initiatives and Corporate Developments

Hormel Foods continued to execute its Transform and Modernize (T&M) initiative, which includes optimizing its supply chain and portfolio. The company began operations at a new distribution center in Memphis, Tennessee, and announced the closure of a California dry sausage production facility, moving related production to other internal facilities.

Management's Perspective

Jim Snee, president and CEO, commented, "We achieved solid organic top-line growth and delivered second quarter results in line with our expectations. We anticipate strong second half growth led by our range of consumer-focused, protein-centric products. Notably, we expect meaningful contributions from our turkey portfolio, continued momentum in the Planters® brand, growth from our leading positions in the marketplace, and ongoing benefits from our Transform and Modernize initiative."

Future Outlook

For fiscal year 2025, Hormel Foods has narrowed its organic net sales growth outlook to 2% to 3% and its diluted EPS expectations to $1.49 to $1.59. The company also reaffirmed its outlook of year-over-year T&M benefits in the range of $100 million to $150 million.

SEC Filing: HORMEL FOODS CORP /DE/ [ HRL ] - 8-K - May. 28, 2025