Hershey sees major sales growth across its global markets
Hershey, PA / USA - November 26, 2019: Merchandise, souvenirs, clothing, and candy are on sale at Hershey's Chocolate World.
A key upturn in performance for US-based confectionery group Hershey, has seen increased consumer demand see results quarterly figures increase 16.5% year-on-year, to $1.99 billion, according its latest results, reports Neill Barston.
The business revealed there had been a ‘robust recovery’ in away-from-home consumption and also within its international markets, as well as continued strength in take-home consumption that delivered an improved financial picture.
In addition, despite increased costs surrounding marketing and administration, the business saw its operating profits rise by 19% year-on-year, to $456.7 million for the second quarter, driven by higher volumes.
As the company explained, its North American sales in the US and Canada made up the bulk of its trading, recording net sale of $1.78 billion (up 12%), largely accounted for through increases in at-home consumption levels of confectionery and snacks markets within the region. Retail takeaway figures also increased by 6.5% year-on-year.
Notably, second-quarter 2021 net sales for Hershey’s International and Other segment increased 70.2% versus the same period last year to $210.2 million, showing an encouraging wider global interest in its confectionery ranges.
Hershey’s U.S. candy, mint and gum (CMG) retail takeaway increased 6.5%, driven by continued strength in everyday take-home chocolate, along with recovery of certain parts of the portfolio negatively impacted by COVID-19 including instant consumables and refreshment products.
The company’s chocolate instant consumables and refreshment products increased 5.6% and 26.7%, respectively, as mobility and convenience store trips returned to pre-pandemic levels and social distancing and mask wearing declined as more of the US population became vaccinated.
However, there was a note of caution, as despite growth across all segments of confection, Hershey’s CMG share declined by approximately 105 basis points in the latest 12 weeks, primarily a result of the company’s significant share gains in the year ago period.
“Our business continued to excel in the second quarter with robust recovery in away-from-home consumption and international markets and sustained elevated at-home consumption,” said Michele Buck, The Hershey Company President and Chief Executive Officer. “This strong consumer demand, coupled with our executional excellence, healthy balance sheet and relentless focus on delivering against our strategic initiatives in the quarter enabled us to support and expand our portfolio, invest in our people and deliver strong shareholder returns. As trends continue to fluctuate, we are confident in our ability to adapt with our consumers and retailers and continue meeting their needs in the future.”