May 23, 2008

Hormel Foods reports 14-percent increase for Q2 earnings
 

Hormel Foods' second quarter earnings rose 14 percent on-year to US$77.6 million on sales of US$1.59 billion, thanks to low pork prices and strong spam sales.

Hormel attributed the result to spam products, which the company had improved promotion for.

The company's refrigerated foods division also saw an increased profit of 26 percent to US$55.6 million, thanks to low hog input prices. However, the company's Jennie-O Turkey brand did not do as well due to rising corn prices, with profits falling by 16 percent.

Hormel is planning to reduce poultry placements in its facilities by 5 percent due to market dynamics.

The company hopes to build on the positive first half results but further pressure from rising grain and energy costs is expected, according to president and CEO Jeffrey Ettinger.

Hormel Foods earned US$165.7 million in the first half of the year, up from US$143.3 million on-year. Revenue also rose to US$3.2 billion, up from US$3 billion on-year.