Hershey Co., the nation's second-biggest candy maker, said Tuesday that its fourth-quarter profit climbed on price increases and lower charges as it continued to push its brands to cost-conscious consumers and gain market share.
The company also maintained its 2010 adjusted earnings and sales forecasts while boosting its quarterly dividend.
Hershey recently said it would not bid for British rival Cadbury PLC. Cadbury shareholders are expected to vote on Kraft Foods Inc.'s $19.5 billion offer on Tuesday.
Hershey's earnings rose 54 percent to $126.8 million, or 55 cents per share, for the period ended Dec. 31.
Removing one-time charges, profit was 63 cents per share. This topped the forecast of analysts polled by Thomson Reuters, who predicted earnings of 60 cents per share. These estimates generally take out one-time items.
Sales grew 2 percent to $1.41 billion during the quarter which included Halloween and Christmas — usually a strong sales period for the maker of Hershey's chocolate bars and Reese's peanut butter cups. Analysts expected $1.42 billion in revenue.
For the year, profit improved to $436 million, or $1.90 per share, compared with $311.4 million, or $1.36 per share, a year earlier. Adjusted earnings were $2.17 per share.
Full-year sales increased 3 percent to $5.3 billion from $5.13 billion.
In 2010 the candymaker, based in Hershey, Pa., reaffirmed that it expects its adjusted profit to rise 6 percent to 8 percent and sales to climb 3 percent to 5 percent.
Based on 2009 figures, that implies adjusted earnings of about $2.30 to $2.34 per share on sales of about $5.46 billion to $5.56 billion for 2010.
Analysts predict a profit of $2.28 per share on revenue of $5.5 billion for the year.
West said the candymaker will launch its Hershey's Bliss white chocolate during the first half of the year, as well as continue to expand its Pieces product line to include Hershey's Special Dark, Almond Joy and York.
The company expect to boost its ad spending by 25 to 30 percent to promote brands such as Reese's, Hershey's Kisses, Bliss, Twizzlers, Kit Kat and its namesake. New ad campaigns are also planned for Almond Joy, Mounds and York.
Hershey said its earnings, combined with improved working capital and higher operating cash flow, led it to raise its quarterly dividend by 2.25 cents to 32 cents. The dividend will be paid on March 15 to shareholders of record Feb. 25.
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