Hormel Foods

Hormel delivered a strong fiscal Q2 with organic net sales up 3%, its sixth consecutive quarter of organic growth, and adjusted EPS of $0.40, up 14% year over year (GAAP EPS was $0.29, down 12.12%, weighed by a one-time loss on the divested whole-bird turkey business booked to SG&A). All three segments grew profit, led by foodservice (organic sales +7%, segment profit +11%) and international (organic sales +5%, segment profit +20%), while retail returned to 1% organic growth with 13% segment profit growth. Gross margin expanded 70 basis points to 17.4% on pricing, favorable mix, and improved turkey manufacturing performance. Management reaffirmed full-year net sales guidance of $12.2 to $12.5 billion and adjusted EPS of $1.43 to $1.51, and said it is trending toward the upper half of the earnings range, though it expects third quarter adjusted earnings roughly in line with the prior year on fuel, commodity, and inventory-rebalancing headwinds.