Hershey has published its sales and earnings for the third quarter, showing lower-than-expected results due to weak demand for mint, gum and candy.
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The results topped Wall Street expectations. According to Reuters, this fall could be attributed to the strong dollar. In addition, worldwide sales plummeted 15 percent as compared to the previous year.
The chocolate bar and candy maker reported a 31 percent drop in net income to $154.8 million, or 70 cents per share.
A shift in consumer preference from sweets and other sugary snacks to healthier foods has forced retailers to limit their marketing efforts on such products.
Adjusted profit for the full year is now expected to be US$4.10 per share compared with the US$4.10 to US$4.18 the group expected as it ramps up spending during the holiday quarter.
However, officials at the company remain positive of the future outcome.
For the quarter, net sales were US$1,960.8 million compared with US$1,961.6 million in 2014.
A continued decline in Chinese chocolate sales hurt The Hershey Co.in the third quarter. The company’s strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and expanding profit margins.
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Helping to lift the adjusted net profits were improved price realization, better supply chain productivity and benefits from cost-saving initiatives, offset in part by higher commodity prices. Hershey reported actual earnings last quarter of 0.78, which beats the 0.75 consensus estimate, a 4.00% surprise. However, excluding such currency exchange rates, full-year net sales are expected to increase about 1.5 percent to 2.0 percent.
