Hershey (HSY) - Get Report, the iconic chocolate-treat maker, beat Wall Street's second-quarter earnings estimates, missed the sales forecast, raised its dividend and offered sweet guidance for a pickup in sales in the second half.
Shares of the Hershey, Pa., company at last check were 4.1% higher at $144.15.
The company reported net income of $268.9 million, or $1.29 a share, compared with $313.3 million, or $1.48 a share, in the year-earlier quarter. The latest adjusted earnings came to $1.31 a share, beating the FactSet consensus analyst call for $1.12.
Sales slipped 3.4% to $1.71 billion from $1.77 billion a year earlier. The latest figure missed FactSet's forecast of $1.74 billion.
Hershey said it expects faster sales growth in the second half of the year based on momentum exiting the second quarter.
The company also expects pricing and cost management to fatten profit margins in the second half of the year.
The company declined to provide full-year 2020 financial guidance because the impact of recent spikes in coronavirus cases on consumer mobility, retail operations, government regulations, and the macroeconomic environment remains unclear.
For North America, Hershey said it expected stronger second-half sales growth as consumers - largely stuck at home due to the virus - continue to eat more at home and retailers and distributors replenish inventory levels.
For the international segment, the company said it expected a slower recovery given current travel, retail, government and macroeconomic trends.
Sales trends are expected to improve compared with the second quarter but will fall short in the second half compared with the prior year by double digits.
The coronavirus pandemic lockdown has resulted in a spike of chocolate sales since mid-March.
During the 17-week period ended June 27, consumers bought $3.7 billion of chocolate, a 6.3% increase from the year-earlier period, CNN reported, citing Nielsen data.
In addition to chocolate, snack-food consumption grew 8% in April 2020 from the previous year.
Hershey's board declared a dividend of 80.4 cents a share, up about 4%, payable Sept. 15 to holders of record Aug. 21.