Net income in the first quarter ended Feb. 28 totaled $422.6 million, equal to $3.22 per share on the common stock, up sharply from $93.5 million, or $0.75 per share, in the same period a year ago. Adjusted net income, which includes a non-recurring income tax benefit of $297.9 million associated with the US Tax Act, totaled $133.2 million in the first quarter, which compared with $96 million in the same period a year ago.
Net sales increased 19 percent to $1,237.1 million, up from $1,043.7 million in the same period a year ago.
“Our first-quarter results were a great start to the year, delivering strong sales, operating income and earnings per share growth, as well as significant margin expansion,” Lawrence E. Kurzius, chairman, president and CEO, said during a March 27 conference call with analysts. “Our successful execution of our strategies and engagement of employees around the world have driven these results across both of our segments. And we’re confident they will continue to drive strong results as we go through the year.
“In our Consumer segment, we continue to grow our underlying business in every region. We’re confident that the breadth and reach of our portfolio continues to position us to fully meet the demand for flavor around the world and grow our business.”
During the call, Kurzius expanded on the company’s recent decision to reintroduce its Industrial segment as Flavor Solutions.
“We are not a bulk herb and spice or commodity business,” he said. “We are one of the top global flavor suppliers to the food industry today. Our culinary approach to flavor development sets us apart. We have a world-class global culinary team of executive and research chefs, mixologists and culinary nutritionists, who work closely with our customers and innovation teams.”
Kurzius said McCormick intends to continue the migration of its portfolio to more technically insulated and value-added categories in 2018.
“We have already realized further results against this strategy in our first quarter, with flavor sales up double digits in North America,” he said.