The earnings call reflected a generally positive sentiment with strong improvements in volume growth, gross margin expansion, and earnings per share. However, the company faces challenges in the Chinese market and weaker QSR traffic impacting certain segments. Despite these challenges, the company is confident in meeting the high end of its sales growth guidance for the year.

Company Guidance

During the third quarter earnings call for McCormick & Company (MKC), the company reported flat sales in constant currency, with a 1% increase in volume and product mix, offset by flat pricing and the impact of a canning divestiture. The Consumer segment in the Americas showed a 1% volume growth, continuing a trend of sequential volume improvement for three consecutive quarters. In EMEA, consumer sales saw a 3% increase, driven by a 4% rise in volume, while sales in the Asia Pacific, excluding China, experienced strong volume-led growth. However, the Chinese market posed challenges, affecting the overall outlook. In the Flavor Solutions segment, a 3% increase in constant currency sales in the Americas was noted, although the EMEA region experienced a 9% decline. The gross profit margin improved by 170 basis points, and adjusted operating income rose by 15% compared to the previous year, driven by favorable product mix and cost savings programs. The company also benefited from a lower tax rate, now expected to be approximately 21% for the year, influenced by a discrete tax item benefit. Overall, McCormick anticipates achieving the mid- to high end of its constant currency sales growth guidance for 2024, supported by its strategic investments and favorable consumer trends, particularly in spices and seasonings.

Sequential Volume Improvement

The company achieved total positive volume growth in Q3 despite a challenging environment, with sequential volume improvements in both Consumer and Flavor Solutions segments.

Consumer Segment Growth

In the Americas, there was a 1% volume growth in the Consumer segment, driven by innovation and distribution expansion.

Gross Margin Expansion

Gross profit margin expanded by 170 basis points in Q3, primarily due to favorable mix within the Flavor Solutions segment and continuous improvement programs.

Adjusted Operating Income Increase

Adjusted operating income increased by 15% compared to the previous year, or 16% in constant currency.

Strong Earnings Per Share

Adjusted earnings per share for Q3 2024 was $0.83, up from $0.65 in the previous year.

Performance in EMEA and APAC

Positive volume growth in EMEA and strong volume-led sales growth outside of China in the Asia Pacific region.

Improved Tax Rate

The tax rate benefited from resolution of an outstanding tax matter, resulting in a decrease to approximately 21% for the year.

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McCormick & Company (MKC) Earnings, Revenues Date & History

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MKC Earnings History

Report Date	Fiscal Quarter	Forecast / EPS	Last Year's EPS	EPS YoY Change	Slides	Play Transcript
Jan 23, 2025	2024 (Q4)	0.77 / -	0.85	―	―	―
Oct 01, 2024	2024 (Q3)	0.67 / 0.83	0.65	27.69% (+0.18)
Jun 27, 2024	2024 (Q2)	0.59 / 0.69	0.6	15.00% (+0.09)
Mar 26, 2024	2024 (Q1)	0.58 / 0.63	0.59	6.78% (+0.04)
Jan 25, 2024	2023 (Q4)	0.79 / 0.85	0.73	16.44% (+0.12)
Oct 03, 2023	2023 (Q3)	0.65 / 0.65	0.69	-5.80% (-0.04)
Jun 29, 2023	2023 (Q2)	0.58 / 0.60	0.48	25.00% (+0.12)
Mar 28, 2023	2023 (Q1)	0.50 / 0.59	0.63	-6.35% (-0.04)
Jan 26, 2023	2022 (Q4)	0.86 / 0.73	0.84	-13.10% (-0.11)
Oct 06, 2022	2022 (Q3)	0.70 / 0.69	0.8	-13.75% (-0.11)	―	―

The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.

Beat

Missed

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MKC Earnings-Related Price Changes

Report Date	Price 1 Day Before	Price 1 Day After	Percentage Change
Oct 01, 2024	$81.87	$83.65	+2.17%
Jun 27, 2024	$66.92	$69.82	+4.33%
Mar 26, 2024	$68.78	$76.02	+10.53%
Jan 25, 2024	$64.69	$67.46	+4.28%

Earnings announcements can affect a stock’s price. This table shows the stock's price the day before and the day after recent earnings reports, including the percentage change.

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