N🟁N

Hershey Announces Price Increase and Reaffirms Outlook for 2011

  //house-home.news-articles.net/content/2011/03/3 .. ice-increase-and-reaffirms-outlook-for-2011.html
  Published in House and Home on Wednesday, March 30th 2011 at 13:10 GMT by Market Wire
          ^{🞛 This publication is a summary or evaluation of another publication}

HERSHEY, Pa.--([ BUSINESS WIRE ])--The Hershey Company (NYSE:HSY) today announced an increase in wholesale prices across the majority of its U.S., Puerto Rico and export portfolio.

"We remain committed to the higher levels of global brand support, consumer spending and investment in go-to-market capabilities communicated in February"

A weighted average price increase of approximately 9.7 percent across the Company's instant consumable, multi-pack, packaged candy and grocery lines is effective today. These changes will help offset part of the significant increases in Hersheya™s input costs, including raw materials, packaging, fuel, utilities and transportation.

aWe remain committed to the higher levels of global brand support, consumer spending and investment in go-to-market capabilities communicated in February,a said David J. West, President and Chief Executive Officer. aWe will work with our retail customers to ensure that the implementation of the price increase is supported with customer trade promotions and merchandising that continues to grow the category.

aDirect buying customers will be able to purchase transitional amounts of product into May, and we do not expect seasonal net price realization until Easter 2012. Given this timing and some higher than anticipated costs, we do not expect this action to materially impact our financial expectations this year. We expect the majority of the financial benefit from this pricing action to impact our earnings in 2012.

aAs a result, we continue to expect full-year 2011 net sales, including the impact of foreign currency exchange rates, and adjusted earnings per share-diluted growth to be around the top of the Companya™s long-term 3 to 5 percent and 6 to 8 percent objectives, respectively.

aOur category offers attractive price points, and consumers know and trust Hersheya™s great brands, including Hershey's, Hershey's Kisses, Reese's, Kit Kat and Twizzlers. Our products and our category will continue to provide the value and quality that consumers expect, and this action will position Hershey to achieve the opportunities that lie ahead,a West concluded.

Note: In this release, Hershey references income measures which are not in accordance with U.S. generally accepted accounting principles (GAAP) because they exclude business realignment and impairment charges. These non-GAAP financial measures are used in evaluating results of operations for internal purposes. These non-GAAP measures are not intended to replace the presentation of financial results in accordance with GAAP. Rather, the Company believes exclusion of such items provides additional information to investors to facilitate the comparison of past and present operations.

In 2010, the Company recorded GAAP charges of $53.9 million, or $0.14 per share-diluted, attributable to the Project Next Century program. Additionally, in the second quarter of 2010, the Company recorded a non-cash goodwill impairment charge of $44.7 million, or $0.20 per share-diluted, related to the Godrej Hershey Ltd. joint venture. In 2011, the Company expects to record total GAAP charges of about $45 million to $55 million, or $0.13 to $0.16 per share-diluted, attributable to Project Next Century. Below is a reconciliation of GAAP and non-GAAP items to the Companya™s 2010 adjusted earnings per share-diluted and projected adjusted earnings per share-diluted for 2011:

Safe Harbor Statement

This release contains statements that are forward-looking. These statements are made based upon current expectations that are subject to risk and uncertainty. Actual results may differ materially from those contained in the forward-looking statements. 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 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, including risks of subsequent litigation or further government action; pension cost factors, such as actuarial assumptions, market performance and employee retirement decisions and funding requirements; the ability to implement our supply chain realignment initiatives within the anticipated timeframe in accordance with our cost estimates and our ability to achieve the expected ongoing annual savings from these initiatives; and such other matters as discussed in our Annual Report on Form 10-K for 2010. All information in this press release is as of March 30, 2011. The Company undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the Companya™s expectations.