McCormick & Company, Inc. has reported strong increases in sales and profit for the second quarter of fiscal year 2011. The company adjusted its 2011 financial outlook to reflect the impact of recently announced agreements to acquire a leading flavor brand in Poland and a majority interest in a joint venture in India.
In the second quarter, the company increased sales 11%. In local currency, the sales increase was 8%. Earnings per share rose 12% to $0.55. Projected CCI cost savings are now expected to be at least $45 million in 2011. The company also expects to achieve $2.74 to $2.79 earnings per share for fiscal year 2011, which includes estimated transaction costs related to recent announcements of an acquisition and a joint venture.
Alan D. Wilson, the company's chairman, president and CEO, commented, "We were pleased to report double-digit increases in both sales and profit this quarter. We achieved a strong performance in both our consumer and industrial segments through new products, increased distribution and effective brand marketing. Our profit performance demonstrates our ability to offset steep cost increases with a combination of pricing actions and cost savings from our Comprehensive Continuous Improvement program. CCI is our ongoing initiative to improve productivity and reduce costs throughout our organization. McCormick employees are highly engaged in this effort and we now expect to deliver at least $45 million of CCI cost savings in 2011.
"We are also executing well against our strategy to expand our presence in emerging markets with our current businesses and through acquisitions," he continued. "Our business in China has particularly strong growth driven by new product innovation and expanded distribution. In early June we announced an agreement to enter into a joint venture to market and sell in India, Kohinoor, a leading brand of basmati rice and other food products. Earlier this week we announced an agreement to acquire Kamis, a leading brand of spices, seasonings and mustard in Poland. We are excited about potential growth opportunities for both of these businesses and with these additions to our portfolio, expect more than 12% of 2012 sales to come from emerging markets, up from 9% in 2010."