Hershey said today (24 October) its growth in sales, as well as lower costs should help it increase underlying gross margins by more than it expected.
The US confectionery giant forecast a 240-250 basis point improvement in adjusted gross margin versus a previous estimate of a hike of 220 to 230 basis points.
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The Reese’s maker pointed to its “year-to-date results”, which have seen it grow sales and profits over the first nine months of the year. It also cited fixed cost volume absorption and falling input costs.
“I’m very pleased with our quarterly and year-to-date results. Volume continues to be a driver of our net sales growth despite macroeconomic challenges in the broader marketplace,” Hershey president and CEO J.P. Bilbrey said. “We’ve carried our momentum into the fourth quarter which is off to a good start.”
Hershey reported a 31.8% jump in net income to $233m for the third quarter to 29 September. Net sales were up 6.1% to $1.85bn. Volumes were also up 6.1% thanks to Hershey’s “core” products and new lines at home and abroad.
For the first nine months of 2013, net income grew 24.1% to $634.4m. Net sales were up 6.1% at $5.19bn.
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By GlobalDataClick here for the full statement from Hershey.
