Hormel Foods Corporation today announced a record-breaking financial performance for the year which ended Oct.

Tuesday, November 23, 1999

Hormel Foods Corporation today announced a record-breaking financial performance for the year which ended Oct. 30 with net earnings, dollar sales and tonnage volume at all-time highs.

The multinational marketer of consumer-branded meat and food products reported total earnings of $163,438,000, or $2.22 per share of common stock.

This represents an increase of 17.3 percent, or $24,147,000, from total reported earnings of $139,291,000, or $1.85 per share of common stock for fiscal 1998.

Joel W. Johnson, chairman of the board, president and chief executive officer, described fiscal 1999 as a year of significant accomplishment.

"It is always a highlight to report record profits," Johnson said. "However, our accomplishments reach well beyond the outstanding financial performance reported for the year. The excellent increases attained in branded products supported our objective of becoming a major further-processed, value-added food company."

"We continued to achieve stronger tonnage and market shares for many of our best-known consumer-branded lines. In addition, we were particularly active in the development of new, on-trend products that enjoyed considerable success in the marketplace," he said.

Johnson offered special praise to all major segments of the corporation for their strong contributions throughout the year. "Virtually every division and subsidiary contributed to our excellent performance," he said. "It was a team effort by all marketing, sales, operating and administrative groups."

Within the Prepared Foods Group, the Grocery Products Division recorded new highs in profits, tonnage and dollar sales to surpass last year’s previous records.

Tonnage growth was achieved in all major core brands – SPAM luncheon meat, Dinty Moore stew, Mary Kitchen hash, Hormel chunk ham and chunk chicken and Hormel chili. Hormel Foods now sells more consumer-branded chili under the Hormel and Stagg brands than the next eight brands combined and is pushing toward the 50 percent category share mark.

The Meat Products Group also established record profits and sales tonnage and finished the year with a slight increase in dollar sales over fiscal 1998. Always Tender fresh pork and Always Tender flavored pork products were major contributors to the year-end results as were Cure 81 hams, both boneless and spiral varieties, and Hormel pepperoni in regular and turkey flavors.

The Foodservice Group had an outstanding year with solid growth in branded, customer-labeled and fresh pork programs.

For Jennie-O Foods, it was a banner year with across-the-board records in dollar sales, tonnage volume and profits.

Hormel Foods International (HFI) enjoyed a record sales and export volume year and greatly improved earnings results.

Total reported earnings exceeded operating earnings of $159,630,000, or $2.17 a share, because of a gain included in the first quarter of $3,808,000, or $.05 a share, for the sale of land by Campofrio Alimentacion, S.A., Madrid, Spain, a company in which Hormel Foods has a 21.4 percent ownership interest.

In fiscal year 1998, total reported earnings reflected a one-time first quarter gain of $17,402,000, or $.23 a share, for the sale of the company’s Davenport (Iowa) gelatin/specialized proteins plant. Excluding this gain, the company reported operating earnings in fiscal 1998 of $121,889,000, or $1.62 per share. Thus, Hormel Foods operating groups generated earnings growth of 31.0 percent in fiscal 1999.

Dollar sales for the 52-week year were $3,357,757,000, a gain of 3.0 percent, or $96,712,000, over the previous record of $3,261,045,000 set in fiscal 1998 which was a 53-week year. Supporting the new high in sales dollars was a tonnage volume increase of 7.1 percent which followed last year’s 10.3 percent improvement over fiscal 1997.

For the 13-week fourth quarter, earnings were $59,674,000, or $.82 a share, over last year’s 14-week total of $45,152,000, or $.61 a share. This is an increase of 32.2 percent, or $14,522,000. Dollar sales for the final quarter were $950,839,000, a 4.3 percent increase over fourth quarter dollar sales one year ago of $912,037,000.

(Editor’s Note: "SPAM" and "Dinty Moore" and others are registered trademarks of Hormel Foods Corporation."