Chocolate and confectionery products maker Hershey Co. (HSY) posted higher profit for the fourth quarter, sweetened by higher pricing besides improved supply chain efficiencies and productivity. Adjusted per share earnings advanced and surpassed the Street view. Further, the company boosted its quarterly dividend by 7.6%, citing a significant increase in operating cash flow in 2009, and backed its growth outlook for fiscal 2010.
The Hershey, Pennsylvania-based company's fourth-quarter net income was $126.8 million or $0.55 per share, higher than net income of $82.2 million or $0.36 per share reported in the prior-year quarter.
The fourth quarters of 2009 and 2008 results included net pre-tax charges of $26.5 million and $79.7 million, or $0.08 and $0.23 per share, respectively. These charges were associated with the Global Supply Chain Transformation or GSCT program.
The company attributed the profit growth to net price realization and supply chain efficiencies and productivity, partially offset by higher input costs, marketing expenses and employee-related costs, including incentive compensation and pension expense.
On an adjusted basis, net income rose to $144.4 million or $0.63 per share from $133.8 million or $0.59 per share in the comparable quarter of the previous year.
On average, 10 analysts polled by Thomson Reuters expected the company to post earnings of $0.60 per share. Analysts' estimates typically exclude special items.
Quarterly net sales advanced 2.2% to $1.41 billion from the previous year's net sales of $1.38 billion, but fell shy of the $1.42 billion revenue consensus estimate of six Wall Street analysts.
Fourth-quarter sales growth was driven primarily by pricing and improvements in its international business, including an approximate one point benefit from foreign currency exchange rates.
David West, President and Chief Executive Officer of Hershey, said, "During 2009, Hershey made excellent progress in its consumer-driven approach to core brand investment while implementing significant, but necessary, price increases. Our fourth quarter results represent a solid finish to a year marked by good progress against our key strategic initiatives despite the backdrop of the macroeconomic issues affecting consumers."
During the quarter, cost of sales decreased to $836.8 million from $879.9 million in the same quarter of last year. Total costs and expenses dropped to $1.19 billion from $1.22 billion incurred in the year-earlier period.
David West added, "Strong performance at key retail customers continues and overall marketplace performance was in line with our expectations." The company noted that results continue to be solid particularly in the food, convenience and certain non-measured channels.
For the full-year 2009, the candy maker reported net income of $435.9 million or $1.90 per share, compared to $311.4 million or $1.36 per share in 2008.
Adjusted net income totaled $496.8 million or $2.17 per share for 2009, compared to $430.5 million or $1.88 per share in the year ended December 2008. Analysts expected earnings of $2.14 per share for the full year.
Net sales for fiscal 2009 were $5.29 billion, an increase of 3.2%, compared to $5.13 billion reported in the previous year. Seven Wall Street analysts had a consensus revenue estimate of $5.31 billion for fiscal 2009.
In addition, the company on February 1, 2010, declared a quarterly dividend of $0.32 on the Common Stock, an increase of $0.0225 per share. Hershey also declared a dividend of $0.29 on the Class B Common Stock, up $0.0222 per share. The dividends are payable March 15, 2010, to stockholders of record February 25, 2010.
Looking ahead, Hershey reaffirmed its fiscal 2010 sales growth outlook of 3% - 5%, and adjusted earnings per share growth within its long-term objective of 6% - 8%. Analysts are looking for earnings of $2.27 per share on revenue of $5.50 billion for fiscal 2010.
In addition, the company stated that the increased levels of consumer investment and brand support, as well as collaborative efforts with retail customers in all classes of trade would continue and should deliver improvement in net sales within its long-term objective.
The company expects to increase advertising by 25% - 30% during the year, supporting new product launches and core brands - particularly Hershey's, Reese's, Hershey's Kisses, Bliss, Twizzlers and Kit Kat. Hershey would also unveil new core brand advertising campaigns behind the Almond Joy, Mounds and York brands.
West added, "Entering 2010 we feel good about our prospects as we continue to execute our consumer-driven strategy. Our brand-building initiatives continue to resonate with consumers as evidenced by our core brand market share gains. We'll continue with this disciplined approach to investment."
Hershey shares, which have been trading between $30.27 and $42.25 in the past 52 weeks, closed Monday's trading session at $36.81. In the pre-market session, the stock is currently trading at $37.30, up 49 cents or 1.33%.
For comments and feedback contact: editorial@rttnews.com
June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.