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McCormick Q4, Full-Year Results

Posted: February 8, 2006

McCormick & Co. (Sparks, MD) has reported a 1-percent decline in fourth quarter 2005 sales, totaling $737.1 million. (All percentage gains and losses are measured against the same period 2004). Net income for the quarter gained less than 1 percent, totaling $88.1 million.

Full-year 05: The company has reported 2005 (ending November 30) sales of $2.6 billion, a gain of 3 percent. Sales from Silvo, acquired at the end of 2004, contributed 2 percent to the sales increase.

Restructuring: McCormick announced in September 2005 its plan to restructure in order to increase the effectiveness of its supply chain and reduce costs. As a part of the plan, the company will be eliminating 800-1,000 positions globally over the next three years. McCormick is projecting that $50 million of cost savings will be achieved by 2008 with at least $10 million to be realized in 2006. With these plans, the company estimates that the total charges will be $130-$150 million. In the fourth quarter of 2005, $11 million of these charges were recorded due primarily to the announcement in January 2006 that two major U.S. facilities would be closed.