LONDON, UK / ACCESSWIRE / April 05, 2018 / Active-Investors.com has just released a free earnings report on Hormel Foods Corp. (NYSE: HRL). If you want access to this report all you need to do is sign up now by clicking the following link www.active-investors.com/registration-sg/?symbol=HRL. The Company reported its financial results on February 22, 2018, for the first quarter of the fiscal year 2018, ending January 28, 2018. The Company reported a strong earnings growth in Q1 FY18. Register today and get access to over 1000 Free Research Reports by joining our site below:

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Earnings Highlights and Summary

For Q1 FY18, Hormel Foods' total revenues reached $2.33 billion, an increase of 2.24% from $2.28 billion in Q1 FY17. Of this, 1% was organic growth while the remaining was driven by acquisitions. The Company's revenue numbers fell behind analysts' consensus estimates of $2.40 billion.

Hormel Foods' cost of products sold jumped 5.85% to $1.83 billion in Q1 FY18 from $1.73 billion in Q1 FY17. The Company's gross profit was $502.18 million in the reported quarter, which was 9.07% lower than the $552.28 million in the same period of last year.

Hormel Foods' selling, general, and administrative expenses (SG&A) advanced 4.24% to $219.12 million y-o-y, while equity in earnings of affiliates increased 76.94% to $23.53 million y-o-y in Q1 FY18. The Company's operating income declined 13.73% to $306.59 million in Q1 FY18 from $355.36 million in Q1 FY17. The Company's operating margin declined to 13.2% in the quarter under review from 15.6% in the year ago comparable quarter, mainly due to higher hog costs, one-time transaction expenses related to the Columbus acquisition, and increased freight expenses.

Hormel Foods' net income attributable to common shareholders was $303.11 million for the quarter ended January 28, 2018, up 28.9% from $235.15 million in the quarter ended January 29, 2017. The diluted earnings per share (EPS) was $0.56 in the quarter under review, an increase of 27.27% from $0.44 in the year ago corresponding quarter. This was also higher than analysts' consensus estimates of $0.44 per share.

Segment Details

Hormel Foods' Grocery Products segment reported revenues of $613.87 million in Q1 FY18, an increase of 0.57% from $610.37 million in Q1 FY17. The segment had an operating profit of $99.98 million in the quarter under review compared to $92.38 million in the year ago same quarter, reflecting an increase of 8.23%.

Hormel Foods' Refrigerated Foods segment's revenues were $1.18 billion in Q1 FY18, an increment of 4.76% from $1.12 billion in Q1 FY17. The segment reported an operating profit of $142.95 million in Q1 FY18, 17.75% lower than $173.81 million in Q1 FY17.

For Q1 FY18, Hormel Foods' Jennie-O Turkey Store segment reported revenues of $390.65 million, a decrease of 7.21% from $420.99 million in Q1 FY17. The segment had an operating profit of $49.87 million in the quarter under review versus $68.18 million in the year ago comparable quarter, reflecting a decline of 26.85%.

Hormel Foods' International & Other segment had revenues of $150.32 million in Q1 FY18, up 19.47% from $125.83 million in Q1 FY17. The segment's operating profit was $24.66 million in Q1 FY18, 3.17% lower than $25.46 million in Q1 FY17.

Cash Matters

Hormel Foods had cash and cash equivalents of $385.78 million as on January 28, 2018, 13.14% lower than $444.12 million as on October 29, 2017. The Company had a long-term debt, less current maturities, of $624.73 million as on January 28, 2018, up 149.89% from $250 million as on October 29, 2017.

Hormel Foods' net cash flow from operating activities was $304.18 million in Q1 FY18, 55.79% higher than $195.25 million in Q1 FY17. The Company spent $52.94 million on purchases of property and equipment in the reported quarter compared to $33.97 million in the previous year's corresponding quarter.

During Q1 FY18, Hormel Foods paid dividends of $89.81 million, or $0.75 per share, an increase of 17.21% from $76.63 million in Q1 FY17. The Company spent $25.2 million on stock repurchases in Q1 FY18, 17.62% lower than $30.59 million in Q1 FY17.

Outlook

For the full fiscal year 2018, Hormel Foods updated its EPS guidance to $1.81 to $1.95, up from the previous guidance of $1.62 to $1.72. However, the Company's sales guidance for 2018 remains unchanged at $9.70 billion - $10.10 billion. Hormel Foods expects its fiscal 2018 effective tax rate to reduce to 17.5% to 20.5%, due to the recent US corporate tax reform. This lower statutory tax rate is expected to provide nearly $110 million to $140 million in additional cash flow in FY18.

Stock Performance Snapshot

April 04, 2018 - At Wednesday's closing bell, Hormel Foods' stock rose 4.82%, ending the trading session at $35.87.

Volume traded for the day: 7.94 million shares, which was above the 3-month average volume of 2.92 million shares.

Stock performance in the last month ? up 9.13%; previous six-month period ? up 12.37%; and past twelve-month period ? up 3.94%

After yesterday's close, Hormel Foods' market cap was at $18.63 billion.

Price to Earnings (P/E) ratio was at 22.75.

The stock has a dividend yield of 2.09%.

The stock is part of the Consumer Goods sector, categorized under the Meat Products industry. This sector was up 1.6% at the end of the session.

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