Thursday, June 30, 2016

McCormick Earnings

This morning McCormick Co(MKC) released their Q2 2016 results. The company reported EPS of $0.73 on revenues up 4% to $641 million. Acquisitions helped fuel a good chunk of the revenue increase, and the company saw a gross profit margin of 40.7% during the quarter. I like those numbers. So far today the shares have traded up to $106/share. Here is what CEO Lawrence E. Kurzius had to say.

"McCormick's second quarter results continued the strong performance we had in the first quarter of fiscal year 2016. Led by our consumer segment, we increased sales 4% and in constant currency, the increase was 6%. Underpinning our growth is the rise in consumer demand for healthy flavor and high quality products, and we are meeting this demand with an expanding portfolio of on-trend products. In the second quarter, we introduced a number of new products and were pleased to expand our portfolio with the acquisition of Gourmet Garden, a leader in chilled, convenient herbs.

"In addition to higher sales, we significantly increased second quarter gross profit margin. Led by our Comprehensive Continuous Improvement (CCI) program, we are improving productivity and lowering costs throughout the company. We are making great progress toward our four-year goal to achieve $400 million of cost savings by 2019, and have increased our cost savings goal for 2016 to a range of $100 million to $110 million. These cost savings are driving margin improvement and are our fuel for growth, providing the funds for higher brand marketing, product development and acquisitions."

On a side note today is the last day of the quarter. I'll be busy getting the portfolio performance calculated for the last three months so expect an update no later than Tuesday. What a wild time this year continues to be! I'm looking forward to the results, and I am really hoping to make it two quarters in a row that I beat the market. 

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