Hershey Company (NYSE: HSY) shares have risen sharply in trading today after the Hershey, Pennsylvania-based company reported better-than-expected first-quarter results and also raised its full-year outlook.
HSY shares touched a new 52-week high of $66.94 today, and at last check, the stock was trading 5.49% higher at $65.71 on above average volume of 4.04 million.
Hershey, the maker of Reese’s peanut butter cups and Kit Kat bars, said that price increases helped it to post a 10.7% increase in first-quarter sales. Volume dipped slightly in the quarter, but was better-than-expected.
The world’s largest chocolate maker reported first-quarter net profit of $198.7 million, or $0.87 per share, compared with $160.1 million, or $0.70 per share reported for the same period in the previous year. Excluding one-time items, HSY reported earnings of $0.96 per share, beating analysts’ estimate of $0.81 per share.
Net sales for the quarter rose 10.7% to $1.73 billion. Analysts were expecting Hershey to report net sales of $1.66 billion.
Looking ahead, Hershey now expects full-year earnings to come in between $3.11 per share and $3.17 per share. This compares with the company’s prior forecast of $3.08-$3.14 per share. Net sales for the full year are expected to rise between 7% and 9%, compared with previous estimate of an increase of 6.5% and 8.5%.
John P. Bilbrey, President and CEO of Hershey Company, said that HSY’s strong start to the year is the result of continued strategy of disciplined investment in core brands in both the U.S. and key international markets. Bilbrey further said that in the first quarter, net sales rose 10.7% and net price realization was a 10.9 point benefit while volume was off 0.5 compared with prior year.
Bilbrey noted that in the second quarter, shipments of HSY’s new products will accelerate with innovation in chocolate, sugar confectionary and mints and the company will continue with the distribution and rollout of Jolly Rancher Crunch N Chew and the launch of Rolo Minis and Ice Breakers Duos.
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