Hormel Foods Reports Second Quarter Fiscal 2025 Results
SEGMENT HIGHLIGHTS – SECOND QUARTER
Retail
- Volume down 7%
- Net sales flat
- Segment profit up 4%
Net sales in the second quarter of fiscal 2025 were comparable to the prior year, as high-single-digit growth from both our Mexican portfolio and value-added turkey products was primarily offset by the impacts of promotional timing. Two-thirds of the Retail segment’s volume decline in the quarter was due to lower commodity shipments and contract manufacturing. Flagship and rising brands continued to hold leadership positions in their respective categories in the quarter. Notably, the Planters® brand exceeded volume and net sales expectations for the second quarter, while demand for Jennie-O® lean ground turkey remained strong. Retail segment profit increased in the second quarter of fiscal 2025, primarily due to benefits from operational efficiencies as part of the T&M initiative and favorable selling, general and administrative expenses.
Foodservice
- Volume down 7%; organic volume1 down 1%
- Net sales flat; organic net sales1 up 4%
- Segment profit down 6%
Organic net sales1 growth was broad-based in the Foodservice segment in the second quarter of fiscal 2025, with notable contributions from the customized solutions business and the turkey portfolio. Branded products such as Jennie-O®, Hormel® Fire Braised™ meats and Café H® globally inspired proteins delivered another quarter of strong volume and net sales growth. Several categories achieved volume growth in the second quarter of fiscal 2025, despite industry softness. Volume growth in these categories was more than offset by the impact of reduced commodity shipments. Segment profit decreased for the second quarter of fiscal 2025 as higher net sales were more than offset by margin pressures, primarily in non-core businesses. The Foodservice segment continued to benefit from an extensive range of solutions-based products, its direct-selling organization and a diverse channel presence during the second quarter.
International
- Volume up 9%
- Net sales up 7%
- Segment profit down 21%
Double-digit volume and net sales growth in exports, and robust growth in the China market drove top-line performance in the International segment in the second quarter of fiscal 2025. Strong shipments within the refrigerated portfolio, primarily of bacon and pepperoni, made the largest contribution to export growth. Our in-country China business continued to benefit from top-line momentum in both the retail and foodservice channels, supported by innovative product launches. International segment profit decreased in the second quarter of fiscal 2025 as meaningful net sales growth was primarily offset by a temporary shift in export customer mix and softness in Brazil.
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