Jennie-O Turkey Store continues to feel the pinch of tough market conditions in the U.S. turkey industry, with profits declining 31 percent for the fourth quarter of fiscal year 2018 when compared to the fourth quarter of the previous fiscal year.
Also during the most recent quarter, which ended on October 28, Jennie-O’s volume and net sales were both down about 4 percent on a year-over-year basis.
“Volume and sales decreases were due to lower whole bird volume and sales as shipments were shifted into the prior quarter to minimize cold storage expenses,” Hormel Foods, Jennie-O Turkey Store’s parent company, stated in a press release. “Jennie-O premium deli products and Jennie-O foodservice products delivered sales gains. Segment profit decreased as a result of lower whole bird sales, higher feed costs, and increased freight expenses.”
Jennie-O Turkey Store, which recently launched its Turkey Tracker transparency program and its “Give Your Family the Bird” advertising campaign, is the second largest turkey company in the United States, according to the WATT PoultryUSA Top Turkey Companies rankings, trailing only Butterball.
Hormel Foods quarterly results
Despite the lackluster financial performance of Jennie-O Turkey Store for the quarter, the diversified Hormel Foods saw a year-over-year increase in both net earnings and net sales.
Its net earnings for the quarter reached $261.5 million, up from the $218.4 from the fourth quarter of 2017. The company’s net sales rose from $2.49 billion to $2.52 billion.
Looking forward to 2019
Jim Snee, president, CEO and chairman of Hormel Foods, stated that strong execution from every business unit – including Jennie-O – will be required in order to manage through commodity market volatility and global trade uncertainty, but added, “I know our team is up to the challenge.”
“Growth from leading brands such as Wholly Guacamole, Applegate, Jennie-O and SPAM will be important to our success in 2019,” Snee said.
