AUSTIN, Minn. (AP) — Hormel Foods Corp. said Thursday its net income edged up as higher sales of Spam and Hormel chili and other products helped offset higher costs for grain and for commodity costs in its Jennie-O Turkey segment.
The company, which agreed to buy Skippy peanut butter in January as part of its effort to expand its grocery store offerings, also raised its guidance. Its shares briefly rose to a new high.READ MORE: Man Dead, Woman In Critical Condition After Overnight Shooting In South Minneapolis
The Austin, Minn.-based meat producer known for Spam and other cured, smoked and deli meats said net income for the three months ended Jan. 27 edged up 1 percent to $129.7 million, or 48 cents per share, up from $128.4 million, or 48 cents per share, last year. That matched analyst expectations, according to a FactSet poll.
Revenue rose nearly 4 percent to $2.12 billion from $2.04 billion last year. Analysts expected revenue of $2.13 billion. Volume rose 2 percent.
In the company’s refrigerated foods segment, which makes up half of Hormel’s total revenue, revenue fell 2 percent, hurt by higher costs related to pork processing.READ MORE: 'We Don't Have To Do It': Mask Mandate Confusion Abound In Twin Cities
Revenue from grocery products, which includes Spam and makes up about 16 percent of total revenue, jumped 24 percent on strong sales of Spam, Hormel chili, Mary Kitchen hash and Herdez salsa.
Revenue from Jennie-O Turkey Store, which makes up 18 percent of revenue, rose 3 percent as sales of turkey products were offset by higher grain and commodity costs.
The company said it expects weakness in pork and live hog production operations will slowly improve and raised its guidance by 3 cents to $1.93 to $2.03 per share from $1.90 to $2 per share. Analysts expect $1.96 per share.
Its shares rose 42 cents, or 1.2 percent, to $36.54 in morning trading after rising as high as $37.05 earlier in the session. FactSet said that is an all-time high for Hormel shares.MORE NEWS: Police Reform A Major Sticking Point As Legislative Session Nears Its End
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