Hershey Reaffirms Financial Outlook And Charts Year Of Innovation

In a presentation today at the 2014 Consumer Analyst Group of New York (CAGNY) conference, The Hershey Company (NYSE:HSY) highlighted its plans for continued growth in North America by building on the strength of its core brands. Hershey also discussed a number of successes and key initiatives in its international focus markets, including its recent announcement to acquire Shanghai Golden Monkey, that will help further its goal of accelerating revenue growth in these markets as the company drives towards its goal of $10 billion in net sales by 2017.

The company’s progress against its consumer-driven approach to growth in North America and key international markets was part of a broader presentation by Hershey executives John P. Bilbrey, President and Chief Executive Officer; Humberto P. Alfonso, President, International; Michele G. Buck, President, North America; and David Tacka, Chief Financial Officer.

“Our consumer-centric approach, combined with a growing global demand for confections, has enabled us to engage and reach new consumers. Our global brands are resonating with loyal consumers in many new markets and we are gaining market share. The global knowledge and insights we have of the category and consumers is embedded in all of our business decisions – innovation, global brand building as well as our go-to-market model – and is a competitive advantage in the markets where we operate,” said Bilbrey.

The company also announced a year of breakthrough innovation building on its recent launch of Hershey’s Spreads and Lancaster Soft Crèmes in the United States. Brookside, the popular and uniquely crafted chocolate brand that blends exotic fruit flavors from around the world, will join Hershey’s, Reese’s, Hershey’s Kisses, Jolly Rancher and Ice Breakers as the company’s sixth global brand.

The Brookside brand, which Hershey acquired in January 2012, continues to demonstrate strong growth in North America, recording net sales of approximately $200 million in 2013, up 74 percent year over year. The brand is now being tested in various international markets, and in the fourth quarter of 2014, Hershey will be introducing in the United States, Brookside Crunchy Clusters, clusters of crispy multigrains and fruit-flavored centers covered in smooth dark chocolate.

The company will continue charting a path of category expansion and product innovation with the introduction of Ice Breakers Cool Blasts Chews later this year. Ice Breakers Cool Blasts Chews are a breakthrough in refreshment innovation that are a quick dissolving chew with a unique, soft and chewy texture that provides a cool blast of instant freshness. This innovation offers quick refreshment for consumers who like the chewing experience of gum but want convenient and discreet breath freshening. With this introduction, Hershey, which has a 39 percent share of the U.S. mint category, will continue to build on its leadership position.

“Our strategies and business model are working and will support our commitment to deliver predictable and profitable growth,” continued Bilbrey. “The strength of our business coupled with our innovation in the marketplace gives us confidence that our long-term financial targets and our expectation of annual net sales growth of about five to seven percent are achievable. We believe in our ability to grow long-term adjusted earnings per share-diluted by nine to eleven percent which gives us the flexibility to invest in growing our brands and capabilities.”

During the presentation, management reaffirmed the company's full-year 2014 financial expectations for net sales, gross margin and earnings per share-diluted growth provided in its January 30, 2014, earnings release.

About The Hershey Company

The Hershey Company (NYSE: HSY) is the largest producer of quality chocolate in North America and a global leader in chocolate and sugar confectionery. Headquartered in Hershey, Pa., The Hershey Company has operations throughout the world and approximately 14,000 employees.

With revenues of more than $7.1 billion, Hershey offers confectionery products under more than 80 brand names, including such iconic brands such as Hershey's, Reese's, Hershey's Kisses, Hershey's Bliss, Hershey's Special Dark, Kit Kat, Twizzlers, Jolly Rancher and Ice Breakers. The company is focused on growing its presence in key international markets such as China, Mexico and Brazil while continuing to build its competitive advantage in the United States and Canada.

For more than 100 years, The Hershey Company has been a leader in making a positive difference in the communities where its employees live, work and do business. Corporate Social Responsibility is an integral part of the company’s global business strategy, which includes goals and priorities focused on fair and ethical business dealings, environmental stewardship, fostering a desirable workplace for employees, and positively impacting society and local communities. Milton Hershey School, established in 1909 by the company's founder and funded by a trust administered by Hershey Trust Company, provides a quality education, housing, and medical care at no cost to children in social and financial need. Students of Milton Hershey School are direct beneficiaries of The Hershey Company's success.

Safe Harbor Statement

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Many of these forward-looking statements can be identified by the use of words such as “intend,” “believe,” “expect,” “anticipate,” “should,” “planned,” “projected,” “estimated,” and “potential,” among others. These statements are made based upon current expectations that are subject to risk and uncertainty. Because actual results may differ materially from those contained in the forward-looking statements, you should not place undue reliance on the forward-looking statements when deciding whether to buy, sell or hold the company's securities. Factors that could cause results to differ materially include, but are not limited to: issues or concerns related to the quality and safety of our products, ingredients or packaging; changes in raw material and other costs; selling price increases, including volume declines associated with pricing elasticity; market demand for our new and existing products; increased marketplace competition; disruption to our supply chain; failure to successfully execute and integrate acquisitions, divestitures and joint ventures; changes in governmental laws and regulations, including taxes; political, economic, and/or financial market conditions; risks and uncertainties related to our international operations; disruptions, failures or security breaches of our information technology infrastructure; the impact of future developments related to the investigation by government regulators of alleged pricing practices by members of the confectionery industry and civil antitrust lawsuits in the United States; pension costs or funding requirements that could increase at a higher than anticipated rate; and such other matters as discussed in our Annual Report on Form 10-K for 2012. All information in this press release is as of February 19, 2014. The company undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the company's expectations.

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