McCormick’s Q1 Results vs. Expectations
In McCormick’s Q1 earnings report, the spice company generated $1.482 billion in total revenue. This figure translates to a whopping 22% rise in total sales over the quarter compared to the same quarter last year where the company only earned $1.21 billion. This major jump in total business for McCormick extended to nearly all aspects of their Q1 report as well. In fact, the company also saw operating income rise from $194 million last year to $236 million in 2021, representing roughly a 35% increase.
Perhaps the largest point of success for the business, however, is certainly its earnings per share, which rose to $0.60 unadjusted. This is already an increase from last year, which saw the company report $0.54 of earnings per share. However, when looking at adjusted earnings per share, McCormick saw a 33% increase to $0.72 in comparison to last year. This also beat out analyst expectations, which had only projected the company to generate $0.58 of adjusted earnings per share.
McCormick can largely attribute the strong Q1 results to the 35% increase in consumer sales over the three-month period. This is due to an increased amount of people cooking and eating at home in comparison to the same quarter last year, which ended weeks before the pandemic began shutting down restaurants and other dining activities.
Future Outlooks and Stock Market Response
McCormick stock was privy to a nice bump in early pre-market trading this morning as investors were excited not only by the strong Q1 report, but the even stronger fiscal guidance the business provided. In fact, the stock is up over $2 per share, translating to about a 2.4% bump in total stock value.
The spice business also provided incredibly optimistic guidance for the rest of the fiscal year. The sales outlook for the rest of the year now sits at anywhere between 8% to 10%, increasing from previous projections. Adjusted earnings per share for 2021 now stand between $2.97 and $3.02. This is an increase of prior projections of a range between $2.91 to $2.96.
In a statement released alongside the Q1 report, president and CEO of the business, Lawrence E. Kurzius, said, “We started the year with outstanding performance and an even stronger outlook for 2021. In the first quarter, we delivered double digit sales, adjusted operating income, and adjusted earnings per share growth. Our differentiated results prove the strength of our business model, the value of our products and our capabilities as a company. We are confident the breadth and reach of our portfolio differentiates McCormick and the successful execution of our strategies will continue to drive long-term sustainable growth.”
About the Author
Tom Price is a writer focusing on entertainment and sports features. He has a degree from NYU in English with a minor in Creative Writing. He has been previously published for Washington Square News, Dignitas, CBR, and Numbers on the Boards.