NEW YORK – Hershey Foods Corp. (HSY), the largest U.S. chocolate maker, on Thursday reported higher quarterly net income, helped by strong sales of new products like Hershey S'Mores (search) and Swoops (search) and the reduction of a tax expense following an audit.
In a conference call following the results, company executives also detailed a slew of new product launches and said the company's low-carb initiative will continue as planned.
The Hershey, Pa., company reported a second-quarter net profit of $147.2 million, or 56 cents per share, compared with $71.5 million, or 27 per share, a year ago.
"This is the result of our new products and continued emphasis on higher margin, single-serve items," Hershey Chief Executive Richard Lenny said.
Excluding one-time items, the maker of Reese's peanut butter cups and York peppermint patties earned 33 cents a share. Analysts had forecast 31 cents a share, on average, according to Reuters Estimates.
Sales rose 5.2 percent to $893.7 million.
The company also said it expects earnings to increase more than its 9 percent to 11 percent target for the year before one-time items, with net sales up slightly more than the company's 3 percent to 4 percent ongoing target.
Hershey has been extending popular brands like Reese's and Kisses, eliminating less-profitable items and package sizes, and pushing aggressively into convenience and club stores.
In a conference call following the results, executives also spoke of a fourth-quarter launch of a new single-serve bar that would be a blend of pretzel, peanut butter, caramel and peanuts rolled in Hershey's chocolate.
The company is also increasing its initiatives for non-chocolate products such as Ice Breakers Liquid Ice (search) — a new version of the mints filled with liquid — and is placing greater emphasis on targeting the Hispanic population through endorsements by Mexican pop diva Thalia (search).
Despite recent reports about the plateauing of the low-carb diet craze, Hershey plans to continue with its low-carb plans. The company will launch a line of reduced-carbohydrate products called "Carb Alternatives" (search) in the third quarter.
Hershey shares were up 53 cents, or 1.15 percent, at $46.78 in afternoon trading on the New York Stock Exchange.