Hershey Co raised its annual forecasts for sales and profit on Thursday after posting better-than expected results, benefiting from strong demand for its chocolates and sweets during its "biggest ever" Halloween season.
Demand for the company's products such as Reese's Peanut Butter Cups and KitKat chocolates strengthened around the October holiday after the pandemic curtailed trick-or-treating events last year.
"As we head into the final days of Halloween, sales and sell through are both looking strong... We expect this strength to flow into the holiday season as more family gatherings occur this year," said chief executive officer, Michele Buck.
Category Sales Increase
The company said category sales in early and mid-season rose by 18% compared with last year, and by 12% versus 2019, with trick-or-treat participation also expected to rebound to pre-pandemic levels.
Consumer spending on Halloween-related items is anticipated to reach an all-time high of $10.14 billion this year, versus the $8.05 billion in 2020, according to a National Retail Federation survey.
Like other packaged food makers, Hershey has been raising prices in recent months to offset rising costs for raw materials and freight due to global supply chain disruptions triggered by the pandemic.
Consumer Demand
The chocolate maker said elevated consumer demand was expected to offset the higher costs.
Hershey forecast 2021 net sales to grow by 8% to 9%, higher than its previous range of growth between 6% and 8%.
It also expects adjusted earnings per share to range between $6.98 and $7.11, higher than the prior $6.79-$6.92 outlook.
Net sales rose by about 6.3% to $2.34 billion in the third quarter, compared with estimates of $2.33 billion, according to Refinitiv IBES data.
On an adjusted basis, Hershey earned $2.10 per share, beating estimates of $2.00.
News by Reuters edited by Donna Ahern, Checkout. For more A Brands stories click here. Click subscribe to sign up for the Checkout print edition.
