SPARKS, Md., July 1, 2015 /PRNewswire/
-- McCormick & Company, Incorporated (NYSE: MKC), a
global leader in flavor, today reported financial results for the
second quarter ended May 31, 2015 and
provided the latest outlook for fiscal year 2015.
- As a result of unfavorable currency rates, sales declined 1%
in the second quarter of 2015 from the year-ago period. Excluding
this impact, the company grew sales 5% in constant currency with
increases in both business segments.
- Operating income was $104
million in the second quarter of 2015 and included an
unfavorable impact of $19 million
from special charges. Excluding the impact of special charges and
unfavorable currency rates, adjusted operating income in constant
currency rose 7% from $122 million in
the second quarter of 2014.
- Earnings per share was $0.65
in the second quarter of 2015 and included an unfavorable impact of
$0.10 from special charges. Excluding
the impact of special charges, adjusted earnings per share rose 17%
to $0.75 from $0.64 in the second quarter of 2014, mainly due
to a lower tax rate.
- For the 2015 fiscal year, the company reaffirmed its
expected constant currency growth rate for sales and operating
income. The projection for adjusted earnings per share was raised
as a result of a lower expected tax rate for the fiscal
year.
Chairman's Remarks
Alan D. Wilson, Chairman and CEO,
commented, "Our second quarter results demonstrated the
effectiveness of our sales and profit growth strategies and
continued the momentum from the first quarter. Both our
consumer and industrial segments delivered higher sales in constant
currency across each region. We are driving this growth by
developing innovative products, building brand equity and
strengthening our customer relationships. Performance this
period was particularly strong in our top emerging markets, with
constant currency sales increases at a high single-digit rate in
China and at a double-digit rate,
in Mexico and across Eastern Europe and Russia. In developed
markets, we are having success in our U.S. consumer business with
our grilling campaign, further share gains in recipe mixes and
increased sales of Zatarain's. Through the first half of 2015
in constant currency, we had strong consumer business sales growth
in France and Australia from the year-ago period, and our
Europe, Middle East and Africa region (EMEA) continues to drive sales
to quick service restaurants.
"Acquisitions are another important avenue of growth for
McCormick and in June, we were pleased to announce our third
agreement in 2015. The addition of Stubb's, the leading U.S.
brand of premium barbecue sauce will be an excellent complement to
our portfolio of Grill Mates and other items that add flavor at the
grill. Together with the acquisitions of Drogheria &
Alimentari and Brand Aromatics, we have greater confidence in
achieving the upper end of our 4% to 6% projected constant currency
sales growth for 2015.
"Employees throughout the organization are making steady
progress in lowering cost through our Comprehensive Continuous
Improvement (CCI) program and additional streamlining actions, and
we are on track to deliver at least $85
million of cost savings in 2015. Through the first
half, we have recorded $47 million of
special charges. Excluding these charges, our cost savings,
along with our sales results and a favorable tax rate, contributed
to higher adjusted earnings per share in the second
quarter. We are also focused on generating significant
cash flow and through the first half achieved $186 million in cash flow from operations.
Based on our first half performance, strong execution and our
latest 2015 outlook, we expect to deliver another year of solid
financial performance for McCormick shareholders."
Second Quarter 2015 Results
While McCormick reported a 1% sales decline in the second
quarter from the year-ago period, in constant currency, sales grew
5%. In constant currency, consumer business sales rose 3% due
to increased volume and product mix driven by product innovation,
brand marketing support and expanded distribution. The
increase in sales was led by China, Eastern
Europe, the U.S., Australia
and France. In constant
currency, industrial business sales grew 7% both from pricing
actions to offset higher material costs and from higher volume and
product mix. The rate of constant currency sales growth this period
was highest in the EMEA region, driven by innovation,
increased distribution and geographic expansion. Also,
improved demand from quick service restaurants in China has continued, following weak results in
the second half of 2014.
Operating income was $104 million
in the second quarter and excluding special charges, adjusted
operating income was $123 million
compared to $122 million in the
second quarter of 2014. In constant currency, adjusted
operating income rose 7% from the year-ago period, with the
favorable impact of sales growth and cost savings, partially offset
by the unfavorable impact of higher material input costs and
increased retirement benefit expense. In 2015, the company
expects to record an estimated $54
million in special charges for costs associated with its
North America effectiveness
initiative and actions in EMEA. In the first quarter,
$28 million of these special charges
were recorded, with another $19
million recorded in the second quarter.
In the second quarter of 2015, the tax rate was 16%. This
was below the 28% tax rate in the second quarter of 2014, due
primarily to $13 million of discrete
tax benefits recognized in the second quarter of 2015. Mainly
due to the impact of these discrete tax benefits, the company has
lowered its projected effective tax rate for fiscal year 2015 to
approximately 27% from a prior estimate of 27% to 28%. This
latest tax rate estimate is based on an underlying tax of
approximately 29%. Including the impact of unfavorable
currency, income from unconsolidated operations in the second
quarter of 2015 rose 19%. This increase was primarily due to
higher sales and favorable commodity costs for its joint venture in
Mexico.
Earnings per share was $0.65 in
the second quarter of 2015 compared to $0.64 in the year-ago period. Excluding the
$0.10 impact of special charges in
the second quarter of 2015, adjusted earnings per share was
$0.75 compared to $0.64 adjusted earnings per share in the second
quarter of 2014. This increase of $0.11 was led by a more favorable tax rate, as
well as the favorable impact of higher adjusted operating income,
increased income from unconsolidated operations and lower shares
outstanding. Net cash provided by operating activities was
$186 million compared to $182 million in the first half of 2014.
2015 Financial Outlook
The company reaffirmed its expectation to grow sales 4 to 6% in
constant currency. Based on year-to-date results and
prevailing exchange rates, the company continues to anticipate that
currency will lower this sales growth range by 5 percentage
points. In constant currency, the company reaffirmed its
expectation to grow adjusted operating income 6% to 7% from
adjusted operating income of $608
million in 2014. On a reported basis, operating income
is expected to decline 4% to 5% from operating income of
$603 million in 2014. This
range includes the impact of an estimated $54 million of special charges and an estimated 3
percentage point impact from currency. The company continues
to expect cost reductions of at least $85
million, that together with pricing actions, are expected to
help offset higher material costs.
The company raised its outlook for earnings per share by
$0.03, due to a reduction in the
projected 2015 effective tax rate. As a result, the company
expects to report earnings per share of $3.18 to $3.25. Excluding the estimated impact of
$0.29 from special charges, guidance
for adjusted earnings per share is now $3.47
to $3.54. On a constant currency basis, this is a
growth rate of 7% to 9% from 2014 adjusted earnings per share of
$3.37. In the third quarter of
2015, the company expects adjusted earnings per share to decline
from the year-ago period as the result of the projected tax rate
(estimated at 29% in the third quarter of 2015 compared to 21% in
the third quarter of 2014), unfavorable currency rates and higher
investment in brand marketing. Another year of strong cash
flow is anticipated in 2015, with a portion returned to McCormick's
shareholders through dividends and share repurchases.
Business Segment
Results
|
|
Consumer
Business
|
(in
millions)
|
|
Three months
ended
|
|
Six months
ended
|
|
|
5/31/2015
|
|
5/31/2014
|
|
5/31/2015
|
|
5/31/2014
|
Net sales
|
|
$
|
599.8
|
|
|
$
|
615.0
|
|
|
$
|
1,220.1
|
|
|
$
|
1,230.3
|
|
Operating
income
|
|
65.1
|
|
|
85.8
|
|
|
137.4
|
|
|
180.2
|
|
Operating income,
excluding special charges
|
|
80.8
|
|
|
85.8
|
|
|
172.3
|
|
|
180.2
|
|
Consumer business sales declined 3% when compared to the second
quarter of 2014. In constant currency, the company grew sales
3%, mainly due to increased volume and product mix.
- Consumer sales in the Americas grew 1%. In constant currency,
the increase was 2% with higher volume and product mix, and pricing
actions taken to offset the impact of higher material costs. The
higher volume and product mix this period was led by Grill Mates
brand products, recipe mixes and Zatarain's items.
- Consumer sales in EMEA declined 15%, although in constant
currency sales rose 4%. This increase was due to higher volume and
product mix in France,
Poland and Russia mainly driven by brand marketing
support, product innovation and expanded distribution.
- Second quarter consumer sales in the Asia/Pacific region rose 4%. In constant
currency, sales grew 7% as a result of increased volume and product
mix. In both China and
Australia, the company grew sales
at a double-digit rate in constant currency.
Consumer business operating income, excluding special charges,
was $81 million compared to
$86 million in the year-ago
period. In constant currency, adjusted operating income was
comparable to the year-ago period, with the favorable impact of
sales growth and cost savings offset by the unfavorable impact of
higher material costs, increased retirement benefit expense and
product mix. Also in the second quarter, the company had a modest
increase in acquisition-related transaction costs.
Industrial
Business
|
(in
millions)
|
|
Three months
ended
|
|
Six months
ended
|
|
|
5/31/2015
|
|
5/31/2014
|
|
5/31/2015
|
|
5/31/2014
|
Net sales
|
|
$
|
424.3
|
|
|
$
|
418.4
|
|
|
$
|
814.4
|
|
|
$
|
796.5
|
|
Operating
income
|
|
38.7
|
|
|
35.9
|
|
|
60.1
|
|
|
66.1
|
|
Operating income,
excluding special
charges
|
|
42.0
|
|
|
35.9
|
|
|
72.6
|
|
|
66.1
|
|
Industrial business sales rose 1% when compared to the second
quarter of 2014, and in constant currency the increase was
7%. Pricing actions taken in response to higher material
costs, as well as higher volume and product mix, contributed to the
increase. In addition, acquisitions added 1 percentage point
of the year-on-year growth in the second quarter.
- Industrial sales in the Americas rose 3%. In constant currency
the increase was 5%, driven by higher pricing and 2 percentage
points of growth from Brand Aromatics, acquired early in the second
quarter. During the second quarter, strong customer demand and
innovation for snack seasonings continued in both the U.S. and
Latin America, although demand
from quick service restaurants remained weak.
- In EMEA, industrial sales declined 1%. In constant currency the
company grew sales 12%. This continues a strong increase for this
region, primarily driven by product innovation, distribution gains
and geographic expansion. Pricing actions to cover higher material
costs added 3 percentage points of the year-on-year growth this
period.
- Industrial sales in the Asia/Pacific region declined 2%. In constant
currency, sales increased 4% as a result of higher volume and
product mix in both Australia and
China.
Industrial business operating income, excluding special charges,
was $42 million compared to
$36 million in the year-ago
period. In constant currency, adjusted operating income had a
strong 24% increase from the year-ago period, with the favorable
impact of higher sales, cost savings and favorable product mix more
than offsetting the unfavorable impact of higher material costs and
increased retirement benefit expense.
Non-GAAP Financial Measures
The tables below include financial measures of adjusted
operating income, adjusted net income and adjusted diluted earnings
per share, each excluding the impact of special charges for the
periods presented. These represent non-GAAP financial
measures which are prepared as a complement to our financial
results prepared in accordance with United States generally accepted accounting
principles. In our consolidated income statement, we include
a separate line item captioned "special charges" in arriving at our
consolidated operating income. Special charges consist of
expenses associated with certain actions undertaken by the company
to reduce fixed costs, simplify or improve processes, and improve
our competitiveness and are of such significance in terms of both
up-front costs and organizational/structural impact to require
advance approval by our Management Committee, comprised of our
Chairman and Chief Executive Officer; Chief Operating Officer and
President, and President Global Consumer; Executive Vice President
and Chief Financial Officer; President Global Industrial, and
President, EMEA and Asia Pacific;
President North America and Senior Vice President, Human Relations.
Upon presentation of any such proposed action (including details
with respect to estimated costs, which generally consist
principally of employee severance and related benefits, together
with ancillary costs associated with the action that may include a
non-cash component; impacted employees or operations; expected
timing; and expected benefits) to the Management Committee and the
Committee's advance approval, expenses associated with the approved
action are classified as special charges upon recognition and
monitored on an on-going basis through completion.
We believe that these non-GAAP financial measures are important
for purposes of comparison to prior periods and development of
future projections and earnings growth prospects. This
information is also used by management to measure the profitability
of our ongoing operations and analyze our business performance and
trends.
These non-GAAP financial measures may be considered in addition
to results prepared in accordance with GAAP, but it should not be
considered a substitute for, or superior to, GAAP results. In
addition, these non-GAAP financial measures may not be comparable
to similarly titled measures of other companies because other
companies may not calculate them in the same manner that we do. We
intend to continue to provide these non-GAAP financial measures as
part of our future earnings discussions and, therefore, the
inclusion of these non-GAAP financial measures will provide
consistency in our financial reporting. A reconciliation of
these non-GAAP financial measures to the related GAAP financial
measures is provided below:
(in millions except
per share data)
|
Three Months
Ended
|
|
Six Months
Ended
|
|
5/31/15
|
|
5/31/14
|
|
5/31/15
|
|
5/31/14
|
Operating
income
|
$
|
103.8
|
|
|
$
|
121.7
|
|
|
$
|
197.5
|
|
|
$
|
246.3
|
|
Impact of special
charges
|
19.0
|
|
|
—
|
|
|
47.4
|
|
|
—
|
|
Adjusted operating
income
|
$
|
122.8
|
|
|
$
|
121.7
|
|
|
$
|
244.9
|
|
|
$
|
246.3
|
|
% increase (decrease)
versus prior period
|
0.9
|
%
|
|
|
|
(0.6)%
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$
|
84.3
|
|
|
$
|
84.5
|
|
|
$
|
154.8
|
|
|
$
|
167.0
|
|
Impact of special
charges net of tax of $6.1
and $14.6 for three and six
month periods,
respectively
|
12.9
|
|
|
—
|
|
|
32.8
|
|
|
—
|
|
Adjusted net
income
|
$
|
97.2
|
|
|
$
|
84.5
|
|
|
$
|
187.6
|
|
|
$
|
167.0
|
|
% increase versus
prior period
|
15.0
|
%
|
|
|
|
12.3
|
%
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share
|
$
|
0.65
|
|
|
$
|
0.64
|
|
|
$
|
1.20
|
|
|
$
|
1.27
|
|
Impact of special
charges
|
0.10
|
|
|
—
|
|
|
0.25
|
|
|
—
|
|
Adjusted earnings per
share
|
$
|
0.75
|
|
|
$
|
0.64
|
|
|
$
|
1.45
|
|
|
$
|
1.27
|
|
% increase versus
prior period
|
17.2
|
%
|
|
|
|
14.2
|
%
|
|
|
Percentage changes in sales and adjusted operating income
expressed in "constant currency" are presented excluding the impact
of foreign currency exchange. To present this information for
historical periods, current period results for entities reporting
in currencies other than the U.S. dollar are translated into U.S.
dollars at the average exchange rates in effect during the
corresponding period of the prior fiscal year, rather than at the
actual average exchange rates in effect during the current fiscal
year. As a result, the foreign currency impact is equal to
the current year results in local currencies multiplied by the
change in the average foreign currency exchange rate between the
current fiscal period and the corresponding period of the prior
fiscal year. Constant currency growth rates follow:
|
|
|
Three Months Ended
May 31, 2015
|
|
|
|
Percentage Change
as Reported
|
|
Impact of Foreign
Currency Exchange
|
|
Percentage Change
on Constant Currency
Basis
|
Net
sales
|
|
|
|
|
|
|
|
Consumer
business
|
|
|
|
|
|
|
|
Americas
|
|
|
0.8%
|
|
(1.3)%
|
|
2.1%
|
EMEA
|
|
|
(14.8)%
|
|
(18.6)%
|
|
3.8%
|
Asia/Pacific
|
|
|
4.2%
|
|
(3.0)%
|
|
7.2%
|
Total consumer
business
|
|
|
(2.5)%
|
|
(5.7)%
|
|
3.2%
|
Industrial
business
|
|
|
|
|
|
|
|
Americas
|
|
|
2.6%
|
|
(2.7)%
|
|
5.3%
|
EMEA
|
|
|
(0.9)%
|
|
(12.9)%
|
|
12.0%
|
Asia/Pacific
|
|
|
(1.6)%
|
|
(5.8)%
|
|
4.2%
|
Total industrial
business
|
|
|
1.4%
|
|
(5.2)%
|
|
6.6%
|
Total net
sales
|
|
|
(0.9)%
|
|
(5.5)%
|
|
4.6%
|
Adjusted operating
income
|
|
|
|
|
|
|
|
Consumer
business
|
|
|
(5.8)%
|
|
(5.7)%
|
|
(0.1)%
|
Industrial business
|
|
|
17.1%
|
|
(6.4)%
|
|
23.5%
|
Total adjusted
operating
income
|
|
|
1.0%
|
|
(5.8)%
|
|
6.8%
|
|
|
|
Six Months Ended May
31, 2015
|
|
|
|
Percentage Change
as Reported
|
|
Impact of Foreign
Currency Exchange
|
|
Percentage Change
on Constant Currency
Basis
|
Net
sales
|
|
|
|
|
|
|
|
Consumer
business
|
|
|
|
|
|
|
|
Americas
|
|
|
2.2%
|
|
(1.2)%
|
|
3.4%
|
EMEA
|
|
|
(12.2)%
|
|
(15.3)%
|
|
3.1%
|
Asia/Pacific
|
|
|
5.9%
|
|
(2.7)%
|
|
8.6%
|
Total consumer
business
|
|
|
(0.8)%
|
|
(4.9)%
|
|
4.1%
|
Industrial
business
|
|
|
|
|
|
|
|
Americas
|
|
|
2.7%
|
|
(2.3)%
|
|
5.0%
|
EMEA
|
|
|
(0.2)%
|
|
(10.6)%
|
|
10.4%
|
Asia/Pacific
|
|
|
3.8%
|
|
(5.3)%
|
|
9.1%
|
Total industrial
business
|
|
|
2.3%
|
|
(4.4)%
|
|
6.7%
|
Total net
sales
|
|
|
0.4%
|
|
(4.7)%
|
|
5.1%
|
Adjusted operating
income
|
|
|
|
|
|
|
|
Consumer
business
|
|
|
(4.3)%
|
|
(4.1)%
|
|
(0.2)%
|
Industrial business
|
|
|
9.8%
|
|
(5.2)%
|
|
15.0%
|
Total adjusted
operating
income
|
|
|
(0.6)%
|
|
(4.5)%
|
|
3.9%
|
To present "constant currency" information for the fiscal year
2015 projection, projected sales and adjusted operating income for
entities reporting in currencies other than the U.S. dollar are
translated into U.S. dollars at the company's budgeted exchange
rate for 2015 and are compared to the 2014 results, translated into
U.S. dollars using the same 2015 budgeted exchange rate, rather
than at the average actual exchange rates in effect during fiscal
year 2014. To estimate the percentage change in adjusted
earnings per share on a constant currency basis, a similar
calculation is performed to arrive at adjusted net income (however,
no adjustment is made for the company's share of income in
unconsolidated operations that are denominated in currencies other
than the U.S. dollar) divided by historical shares outstanding for
fiscal year 2014 or projected shares outstanding for fiscal year
2015, as appropriate.
Fiscal year 2014
actual results and 2015 projection
|
|
(in millions except
per share data)
|
|
|
Twelve Months
Ended
|
|
|
|
2015
Projection
|
|
11/30/14
|
Operating
income
|
|
|
|
|
$
|
603.0
|
Special
charges
|
|
|
|
|
5.2
|
Adjusted operating
income
|
|
|
|
|
$
|
608.2
|
|
|
|
|
|
|
Earnings per
share
|
|
|
$3.18 to
$3.25
|
|
$
|
3.34
|
Impact of special
charges
|
|
|
0.29
|
|
0.03
|
Adjusted earnings per
share
|
|
|
$3.47 to
$3.54
|
|
$
|
3.37
|
|
|
|
|
|
|
Percentage change in
adjusted earnings per share
|
|
|
3% to 5%
|
|
|
Impact of foreign
currency exchange rates
|
|
|
(4)%
|
|
|
Percentage change in
adjusted earnings per share
on constant currency basis
|
|
|
7% to 9%
|
|
|
Live Webcast
As previously announced, McCormick will hold a conference call
with analysts today at 7:30 a.m. ET.
The conference call will be webcast live via the McCormick web
site. Go to ir.mccormick.com and follow directions to
listen to the call and access the accompanying presentation
materials. At this same location, a replay of the call will be
available following the live call. Past press releases and
additional information can be found at this address.
Forward-looking Information
Certain information contained in this release, including
statements concerning expected performance such as those relating
to net sales, earnings, cost savings, acquisitions and brand
marketing support, are "forward-looking statements" within the
meaning of Section 21E of the Securities Exchange Act of
1934. These statements may be identified by the use of words
such as "may," "will," "expect," "should," "anticipate," "intend,"
"believe" and "plan." These statements may relate to: the
expected results of operations of businesses acquired by the
company, the expected impact of raw material costs and pricing
actions on the company's results of operations and gross margins,
the expected productivity and working capital improvements,
expectations regarding growth potential in various geographies and
markets, expected trends in net sales and earnings performance and
other financial measures, the expectations of pension and
postretirement plan contributions and anticipated charges
associated with such plans, the holding period and market risks
associated with financial instruments, the impact of foreign
exchange fluctuations, the adequacy of internally generated funds
and existing sources of liquidity, such as the availability of bank
financing, the ability to issue additional debt or equity
securities and expectations regarding purchasing shares of
McCormick's common stock under the existing authorizations.
These and other forward-looking statements are based on
management's current views and assumptions and involve risks and
uncertainties that could significantly affect expected
results. Results may be materially affected by factors such
as: damage to the company's reputation or brand name; loss of brand
relevance; increased private label use; product quality, labeling,
or safety concerns; negative publicity about our products; business
interruptions due to natural disasters or unexpected events;
actions by, and the financial condition of, competitors and
customers; the company's ability to achieve expected and/or needed
cost savings or margin improvements; negative employee relations;
the successful acquisition and integration of new businesses;
issues affecting the company's supply chain and raw materials,
including fluctuations in the cost and availability of raw and
packaging materials; government regulation, and changes in legal
and regulatory requirements and enforcement practices; global
economic and financial conditions generally, including the
availability of financing, and interest and inflation rates; the
investment return on retirement plan assets, and the costs
associated with pension obligations; foreign currency fluctuations;
the stability of credit and capital markets; risks associated with
the company's information technology systems, the threat of data
breaches and cyber attacks; volatility in the effective tax rate;
impact of climate change on raw materials; infringement of
intellectual property rights, and those of customers; litigation,
legal and administrative proceedings; and other risks described in
the company's filings with the Securities and Exchange
Commission.
Actual results could differ materially from those projected in
the forward-looking statements. The company undertakes no
obligation to update or revise publicly, any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as may be required by law.
About McCormick
McCormick & Company, Incorporated is a global leader in
flavor. With $4.2 billion in annual
sales, the company manufactures, markets and distributes spices,
seasoning mixes, condiments and other flavorful products to the
entire food industry - retail outlets, food manufacturers and
foodservice businesses. Every day, no matter where or what
you eat, you can enjoy food flavored by McCormick.
McCormick Brings Passion to Flavor™.
For more information, visit www.mccormickcorporation.com.
For information contact:
Investor Relations:
Joyce Brooks (410) 771-7244 or
joyce_brooks@mccormick.com
Corporate Communications:
Lori Robinson (410) 527-6004 or
lori_robinson@mccormick.com
(Financial tables follow)
|
Second Quarter
Report
|
|
McCormick &
Company, Incorporated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
Income Statement (Unaudited)
|
|
|
|
|
|
|
|
|
(In millions except
per-share data)
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Six months
ended
|
|
|
May 31,
2015
|
|
May 31,
2014
|
|
May 31,
2015
|
|
May 31,
2014
|
Net sales
|
|
$
|
1,024.1
|
|
|
$
|
1,033.4
|
|
|
$
|
2,034.5
|
|
|
$
|
2,026.8
|
|
Cost of goods
sold
|
|
620.1
|
|
|
620.9
|
|
|
1,240.8
|
|
|
1,222.8
|
|
Gross
profit
|
|
404.0
|
|
|
412.5
|
|
|
793.7
|
|
|
804.0
|
|
Gross profit
margin
|
|
39.4
|
%
|
|
39.9
|
%
|
|
39.0
|
%
|
|
39.7
|
%
|
Selling, general and
administrative expense
|
|
281.2
|
|
|
290.8
|
|
|
548.8
|
|
|
557.7
|
|
Special
charges
|
|
19.0
|
|
|
—
|
|
|
47.4
|
|
|
—
|
|
Operating
income
|
|
103.8
|
|
|
121.7
|
|
|
197.5
|
|
|
246.3
|
|
Interest
expense
|
|
13.0
|
|
|
12.5
|
|
|
25.9
|
|
|
24.9
|
|
Other income,
net
|
|
0.6
|
|
|
0.3
|
|
|
0.4
|
|
|
0.5
|
|
Income from
consolidated operations before
income taxes
|
|
91.4
|
|
|
109.5
|
|
|
172.0
|
|
|
221.9
|
|
Income
taxes
|
|
14.5
|
|
|
31.2
|
|
|
34.5
|
|
|
66.2
|
|
Net income from
consolidated operations
|
|
76.9
|
|
|
78.3
|
|
|
137.5
|
|
|
155.7
|
|
Income from
unconsolidated operations
|
|
7.4
|
|
|
6.2
|
|
|
17.3
|
|
|
11.3
|
|
Net income
|
|
$
|
84.3
|
|
|
$
|
84.5
|
|
|
$
|
154.8
|
|
|
$
|
167.0
|
|
|
|
|
|
|
|
|
|
|
Earnings per share -
basic
|
|
$
|
0.66
|
|
|
$
|
0.65
|
|
|
$
|
1.21
|
|
|
$
|
1.28
|
|
|
|
|
|
|
|
|
|
|
Earnings per share -
diluted
|
|
$
|
0.65
|
|
|
$
|
0.64
|
|
|
$
|
1.20
|
|
|
$
|
1.27
|
|
|
|
|
|
|
|
|
|
|
Average shares
outstanding - basic
|
|
127.9
|
|
|
130.2
|
|
|
128.1
|
|
|
130.6
|
|
Average shares
outstanding - diluted
|
|
129.0
|
|
|
131.2
|
|
|
129.2
|
|
|
131.7
|
|
|
Second Quarter
Report
|
McCormick &
Company, Incorporated
|
|
|
|
|
|
Consolidated
Balance Sheet (Unaudited)
|
|
|
|
|
(In
millions)
|
|
|
|
|
|
|
May 31,
2015
|
|
May 31,
2014
|
Assets
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
89.5
|
|
|
$
|
81.4
|
|
Trade accounts
receivable, net
|
|
390.6
|
|
|
417.1
|
|
Inventories
|
|
738.5
|
|
|
687.3
|
|
Prepaid expenses and
other current assets
|
|
140.3
|
|
|
138.9
|
|
Total current
assets
|
|
1,358.9
|
|
|
1,324.7
|
|
Property, plant and
equipment, net
|
|
590.1
|
|
|
575.0
|
|
Goodwill
|
|
1,719.8
|
|
|
1,798.6
|
|
Intangible assets,
net
|
|
364.6
|
|
|
340.4
|
|
Investments and other
assets
|
|
345.0
|
|
|
370.6
|
|
Total
assets
|
|
$
|
4,378.4
|
|
|
$
|
4,409.3
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
Short-term borrowings
and current portion of long-term debt
|
|
$
|
622.6
|
|
|
$
|
308.4
|
|
Trade accounts
payable
|
|
337.8
|
|
|
335.8
|
|
Other accrued
liabilities
|
|
378.4
|
|
|
358.6
|
|
Total current
liabilities
|
|
1,338.8
|
|
|
1,002.8
|
|
Long-term
debt
|
|
807.9
|
|
|
1,016.8
|
|
Other long-term
liabilities
|
|
496.4
|
|
|
409.8
|
|
Total
liabilities
|
|
2,643.1
|
|
|
2,429.4
|
|
Shareholders'
equity
|
|
|
|
|
Common
stock
|
|
1,019.6
|
|
|
984.1
|
|
Retained
earnings
|
|
1,020.4
|
|
|
969.3
|
|
Accumulated other
comprehensive (loss) income
|
|
(324.7)
|
|
|
8.8
|
|
Non-controlling
interests
|
|
20.0
|
|
|
17.7
|
|
Total shareholders'
equity
|
|
1,735.3
|
|
|
1,979.9
|
|
Total liabilities and
shareholders' equity
|
|
$
|
4,378.4
|
|
|
$
|
4,409.3
|
|
Second Quarter
Report
|
|
McCormick & Company, Incorporated
|
|
|
|
|
|
Consolidated Cash
Flow Statement (Unaudited)
|
|
|
|
|
(In
millions)
|
|
|
|
|
|
|
Six Months
Ended
|
|
|
May 31,
2015
|
|
May 31,
2014
|
Operating
activities
|
|
|
|
|
Net income
|
|
$
|
154.8
|
|
|
$
|
167.0
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
Depreciation and
amortization
|
|
52.5
|
|
|
53.5
|
|
Stock based
compensation
|
|
13.9
|
|
|
12.1
|
|
Income from
unconsolidated operations
|
|
(17.3)
|
|
|
(11.3)
|
|
Changes in operating
assets and liabilities
|
|
(35.2)
|
|
|
(51.6)
|
|
Dividends from
unconsolidated affiliates
|
|
17.2
|
|
|
12.4
|
|
Net cash flow
provided by operating activities
|
|
185.9
|
|
|
182.1
|
|
|
|
|
|
|
Investing
activities
|
|
|
|
|
Acquisition of
businesses (net of cash acquired)
|
|
(111.5)
|
|
|
—
|
|
Capital
expenditures
|
|
(42.7)
|
|
|
(47.4)
|
|
Proceeds from sale of
property, plant and equipment
|
|
0.1
|
|
|
0.7
|
|
Net cash flow used in
investing activities
|
|
(154.1)
|
|
|
(46.7)
|
|
|
|
|
|
|
Financing
activities
|
|
|
|
|
Short-term
borrowings, net
|
|
148.2
|
|
|
94.3
|
|
Long-term debt
repayments
|
|
(0.3)
|
|
|
(1.2)
|
|
Proceeds from
exercised stock options
|
|
14.2
|
|
|
16.1
|
|
Common stock acquired
by purchase
|
|
(69.9)
|
|
|
(126.3)
|
|
Dividends
paid
|
|
(102.5)
|
|
|
(96.7)
|
|
Net cash flow used in
financing activities
|
|
(10.3)
|
|
|
(113.8)
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
|
(9.3)
|
|
|
(3.2)
|
|
Increase in cash and
cash equivalents
|
|
12.2
|
|
|
18.4
|
|
Cash and cash
equivalents at beginning of period
|
|
77.3
|
|
|
63.0
|
|
|
|
|
|
|
Cash and cash
equivalents at end of period
|
|
$
|
89.5
|
|
|
$
|
81.4
|
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/mccormick-reports-second-quarter-results-and-provides-latest-2015-financial-outlook-300107217.html
SOURCE McCormick & Company, Incorporated