The Company Reaffirmed its 2024 Guidance and Provided Expectations for 2028
HUNT VALLEY, Md., Oct. 23, 2024 /PRNewswire/ -- McCormick & Company, Incorporated (NYSE: MKC), a global leader in flavor, yesterday held an Investor Day at the company's Global Headquarters in Hunt Valley, Maryland. Brendan M. Foley, President and CEO, along with members of McCormick's leadership team shared plans to drive sustainable growth by leveraging its competitive advantages and successfully executing on its proven strategies.
Investor Day Financial Highlights
- McCormick reaffirmed all components of its 2024 Outlook which was previously announced on October 1, 2024 during its earnings call. The Company anticipates achieving the mid to high-end of its projected Net Sales growth range and the high-end of its adjusted earnings per share range for 2024.
- McCormick expects 2025 to be a year of continued momentum supported by the effectiveness of its 2024 prioritized investments. The Company anticipates volume growth in-line with its organic long-term growth objective. The Company also expects to drive margin improvement and profitability growth rates closer to its long-term objectives.
- McCormick reaffirmed its long-term growth objectives for Net Sales of 4% to 6%, Operating Income of 7% to 9%, and Earnings Per Share of 9% to 11%. The Company expects to achieve these objectives, at the low end, on a compounded annual growth rate basis over the five-year period ending 2028, without the benefit of acquisitions. The Company expects to reach at least $8 billion in annual Net Sales by 2028.
Brendan M. Foley, President and CEO, stated "McCormick is flavor. It is our history, and it is our future. Our business is differentiated from others in the industry as we do not compete for calories, we flavor them. We have robust plans that leverage the demand for flavor and the strength of our brands. We are increasing our investments in the core categories that drive the greatest value for McCormick.
Our strategies have proven to be effective by driving growth and compounding that growth over the years. It takes a great organization, a strong culture of growth, and a great leadership team to deliver performance. I am confident we have the right leadership team in place and engaged employees globally to deliver on our long-term objectives with industry leading performance."
Forward-Looking Information
Certain statements contained in this release, including statements concerning expected performance such as those relating to net sales, gross margin, earnings, cost savings, special charges, acquisitions, brand marketing support, volume and product mix, income tax expense, and the impact of foreign currency rates are "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. These statements may be identified by the use of words such as "may," "will," "expect," "should," "anticipate," "intend," "believe" and "plan" and similar expressions. These statements may relate to: general economic and industry conditions, including consumer spending rates, interest rates, and availability of capital; expectations regarding our long-term constant currency growth in sales, adjusted operating income, and adjusted earnings per share; expectations regarding sales growth potential in various geographies and markets, including the impact from brand marketing support, product innovation, and customer, channel, category, heat platform and e-commerce expansion; expected trends in net sales and earnings performance and other financial measures; the expected impact of pricing actions on the Company's results of operations, including our sales volume and mix as well as gross margins; the expected impact of the inflationary cost environment on our business; the expected impact of factors affecting our supply chain, including the availability and prices of commodities and other supply chain resources including raw materials, packaging, labor, energy, and transportation; the expected impact of productivity improvements, and cost savings, including those associated with our CCI and GOE programs and Global Business Services operating model initiative; the ability to identify, attract, hire, retain and develop qualified personnel and develop the next generation of leaders; the impact of the ongoing conflicts between Russia and Ukraine, Israel and Hamas, and in the Red Sea, including the potential for broader economic disruption; expected working capital improvements; the expected timing and costs of implementing our business transformation initiative, which includes the implementation of a global enterprise resource planning (ERP) system; the expected impact of accounting pronouncements; the expectations of pension and postretirement plan contributions and anticipated charges associated with those plans; the holding period and market risks associated with financial instruments; the impact of foreign exchange fluctuations; the adequacy of internally generated funds and existing sources of liquidity, such as the availability of bank financing; the anticipated sufficiency of future cash flows to enable the payments of interest and repayment of short- and long-term debt, working capital needs, planned capital expenditures, quarterly dividends and our ability to obtain additional short- and long-term financing or issue additional debt securities; and expectations regarding purchasing shares of McCormick's common stock under the existing repurchase authorization.
These and other forward-looking statements are based on management's current views and assumptions and involve risks and uncertainties that could significantly affect expected results. Results may be materially affected by factors such as: the Company's ability to drive revenue growth; the Company's ability to increase pricing to offset, or partially offset, inflationary pressures on the cost of our products; damage to the Company's reputation or brand name; loss of brand relevance; increased private label use; the Company's ability to drive productivity improvements, including those related to our CCI program and streamlining actions, including our GOE program; product quality, labeling, or safety concerns; negative publicity about our products; actions by, and the financial condition of, competitors and customers; the longevity of mutually beneficial relationships with our large customers; the ability to identify, interpret and react to changes in consumer preference and demand; business interruptions due to natural disasters, unexpected events or public health crises; issues affecting the Company's supply chain and procurement of raw materials, including fluctuations in the cost and availability of raw and packaging materials; labor shortage, turnover and labor cost increases; the impact of the ongoing conflicts between Russia and Ukraine, Israel and Hamas, and in the Red Sea, including the potential for broader economic disruption; government regulation, and changes in legal and regulatory requirements and enforcement practices; the lack of successful acquisition and integration of new businesses; global economic and financial conditions generally, availability of financing, interest and inflation rates, and the imposition of tariffs, quotas, trade barriers and other similar restrictions; foreign currency fluctuations; the effects of our amount of outstanding indebtedness and related level of debt service as well as the effects that such debt service may have on the Company's ability to borrow or the cost of any such additional borrowing, our credit rating, and our ability to react to certain economic and industry conditions; impairments of indefinite-lived intangible assets; assumptions we have made regarding the investment return on retirement plan assets, and the costs associated with pension obligations; the stability of credit and capital markets; risks associated with the Company's information technology systems, including the threat of data breaches and cyber-attacks; the Company's inability to successfully implement our business transformation initiative; fundamental changes in tax laws; including interpretations and assumptions we have made, and guidance that may be issued, and volatility in our effective tax rate; climate change; Environmental, Social and Governance (ESG) matters; infringement of intellectual property rights, and those of customers; litigation, legal and administrative proceedings; the Company's inability to achieve expected and/or needed cost savings or margin improvements; negative employee relations; and other risks described in the Company's filings with the Securities and Exchange Commission.
Actual results could differ materially from those projected in the forward-looking statements. The Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by law.
About McCormick
McCormick & Company, Incorporated is a global leader in flavor. With over $6.5 billion in annual sales across 150 countries and territories, we manufacture, market, and distribute herbs, spices, seasonings, condiments and flavors to the entire food and beverage industry including retailers, food manufacturers and foodservice businesses. Our most popular brands with trademark registrations include McCormick, French's, Frank's RedHot, Stubb's, OLD BAY, Lawry's, Zatarain's, Ducros, Vahiné, Cholula, Schwartz, Kamis, DaQiao, Club House, Aeroplane, Gourmet Garden, FONA and Giotti. The breadth and reach of our portfolio uniquely position us to capitalize on the consumer demand for flavor in every sip and bite, through our products and our customers' products. We operate in two segments, Consumer and Flavor Solutions, which complement each other and reinforce our differentiation. The scale, insights and technology that we leverage from both segments are meaningful in driving sustainable growth.
Founded in 1889 and headquartered in Hunt Valley, Maryland USA, McCormick is guided by our principles and committed to our Purpose – To Stand Together for the Future of Flavor. McCormick envisions A World United by Flavor where healthy, sustainable and delicious go hand in hand.
To learn more, visit: www.mccormickcorporation.com or follow McCormick & Company on Instagram and LinkedIn.
For information contact:
Investor Relations:
Faten Freiha - faten_freiha@mccormick.com
Global Communications:
Lori Robinson - lori_robinson@mccormick.com
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SOURCE McCormick & Company, Incorporated
