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McCormick's Q3 Sales Rise On Strength in Emerging Markets
Posted: September 27, 2012
McCormick & Co.'s fiscal third-quarter sales rose 6%, boosted by acquisitions and strength in emerging markets which accounted for 14% of total sales.
For the three months ended Aug. 31, the company said its sales rose to $977.7 million from $920.4 million a year earlier. Third-quarter net income rose to $104.4 million from $92 million in the same year-ago period.
By region, consumer sales rose 4% in the Americas, grew 10% in the Europe, Middle East and Africa (EMEA) region, and surged 67% in the Asia-Pacific region.
McCormick's 2011 acquisition of Kohinoor Foods Ltd., based in India, added 55% of the sales growth in the Asia-Pacific region. Excluding this impact, the company grew its base business 14% in local currency, which was driven primarily by a strong increase in volume and product mix in China. In the EMEA region, the company's 2011 acquisition of Kamis, a Poland-based brand of spices, seasonings and mustards, contributed 22% to the sales growth for the quarter.
"In mid-2013, we anticipate expanding our emerging market presence with the acquisition of Wuhan Asia-Pacific Condiments Co., which will extend our geographic footprint and flavor portfolio in China," said Alan Wilson, McCormick's president and CEO.
Wilson also said the company is mitigating rising material costs with pricing actions and cost savings and is on track to increase brand marketing support by at least $15 million and now expects to exceed $50 million in cost savings in 2012.
Separately, the company recently named Jacques Tapiero, senior vice president and president, emerging Markets for Eli Lilly and Co., to McCormick's board.