好時 (HSY) 2023 Q3 法說會逐字稿

Good morning, everyone, and welcome to the prerecorded discussion of the Hershey Company's Third Quarter 2023 Earnings Results. My name is Melissa Poole, and I'm the Vice President of Investor Relations at Hershey.

大家早安，歡迎來到好時公司 2023 年第三季獲利結果的預先錄製討論。我叫梅麗莎·普爾，是好時投資人關係副總裁。

Joining me today are Hershey's Chairman and CEO, Michele Buck; and Hershey's Senior Vice President and CFO, Steve Voskuil.

今天和我一起來的還有好時公司董事長兼執行長米歇爾‧巴克 (Michele Buck)；以及好時資深副總裁兼財務長 Steve Voskuil。

In addition to these remarks, we will host an analyst Q&A-only session at 8:30 a.m. Eastern on the morning of October 26. A replay of this webcast and our subsequent Q&A session will be available on the Investor Relations section of our website, along with their corresponding transcripts.

除了這些評論之外，我們還將在東部時間 10 月 26 日上午 8:30 舉辦分析師問答會議。本次網路廣播的重播以及隨後的問答環節將在我們網站的投資者關係部分提供，以及相應的成績單。

During the course of today's discussion, management will make forward-looking statements that are subject to various risks and uncertainties. These statements include expectations and assumptions regarding the company's future operations and financial performance. Actual results could differ materially from those projected.

在今天的討論過程中，管理階層將做出前瞻性聲明，這些聲明受到各種風險和不確定性的影響。這些陳述包括有關公司未來營運和財務表現的預期和假設。實際結果可能與預測有重大差異。

The company undertakes no obligation to update these statements based on subsequent events.

本公司不承擔根據後續事件更新這些聲明的義務。

A detailed listing of such risks and uncertainties can be found in today's press release and the company's SEC filings.

此類風險和不確定性的詳細清單可以在今天的新聞稿和公司向 SEC 提交的文件中找到。

Finally, please note that during today's discussion, we will refer to certain non-GAAP financial measures that we believe will provide useful information for investors. The presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP.

最後，請注意，在今天的討論中，我們將提及某些非公認會計準則財務指標，我們相信這些指標將為投資者提供有用的信息。此資訊的呈現不應被孤立地考慮或作為根據 GAAP 呈現的財務資訊的替代品。

Reconciliations to the GAAP results are included in this morning's press release. It is now my pleasure to introduce our Chairman and CEO, Michele Buck.

今天早上的新聞稿中包含了對公認會計準則結果的調節。現在我很高興向大家介紹我們的董事長兼執行長 Michele Buck。

Thank you, Melissa, and good morning, everyone. We remain on track to deliver our full year sales and earnings commitments after delivering strong seasonal sell-in and successfully implementing our new Salty Snacks ERP system in early October. Halloween is well underway and the shelves are full to meet consumer demand these last few important days. We continue to support our brands with double-digit increases in media during the quarter, and we plan to continue this in Q4 to drive unit conversion on both our seasonal and everyday items.

謝謝你，梅麗莎，大家早安。在實現強勁的季節性銷售並於 10 月初成功實施新的 Salty Snacks ERP 系統後，我們仍有望實現全年銷售和盈利承諾。萬聖節即將到來，貨架上已經擺滿了貨物，以滿足消費者這最後幾個重要日子的需求。我們繼續在本季以兩位數的媒體成長來支持我們的品牌，並計劃在第四季度繼續這樣做，以推動季節性和日常用品的單位轉換。

As we finish the year, our teams are focused on building momentum to position us well for 2024. Our retail teams are delivering best-in-class seasonal merchandising to secure strong sell-through, while our sales teams are partnering with retailers to begin shipping our 2024 innovation for Q1 execution.

年底，我們的團隊將專注於積蓄動力，為 2024 年做好準備。我們的零售團隊正在提供一流的季節性商品，以確保強勁的銷量，而我們的銷售團隊正在與零售商合作，開始發貨我們的2024 年第一季執行創新。

We have a robust pipeline of innovation for 2024, and we couldn't be more excited to kick things off with our Reese's Caramel launch. Our recent technology and capacity investments in our largest brand will enable us to bring the top category flavors together in a unique way that only Reese can deliver. Product testing indicates strong trial and repeat interest, and our customers are excited to partner with us to bring it to life in stores with incremental merchandising.

我們在 2024 年擁有強大的創新管道，我們非常高興能推出 Reese's Caramel 來拉開序幕。我們最近對我們最大品牌的技術和產能投資將使我們能夠以只有 Reese 才能提供的獨特方式將頂級類別口味融合在一起。產品測試顯示了強烈的試用和重複興趣，我們的客戶很高興與我們合作，透過增量銷售將其帶入商店。

As we look to 2024, we are closely monitoring recent consumer trends to inform our strategies and company priorities. As many of you know, sector growth has slowed as pricing moderates and consumers across income cohorts are increasingly focusing on value. Many are cutting back on discretionary purchases, looking for deals, shopping at discount channels and buying smaller sizes. We have also seen more category and brand switching with deflationary perimeter categories and more satiating foods outperforming.

展望 2024 年，我們正在密切關注近期的消費者趨勢，為我們的策略和公司優先事項提供資訊。眾所周知，隨著定價放緩以及不同收入群體的消費者越來越關注價值，行業成長已經放緩。許多人正在減少隨意購買，尋找優惠，在折扣渠道購物併購買較小的尺寸。我們也看到更多的品類和品牌轉換，通貨緊縮的周邊品類和更飽足的食品表現出色。

Hershey has a strong distribution across classes of trade, including presence in channels where consumers are increasing trips such as dollar, club and discount stores. We are increasing focus on these channels and partnering with retailers to capitalize on the incrementality of snacks and confection in baskets. We are also leaning into our brands that deliver on consumers' need for value and satiation, including Dot's Pretzels, ONE and Fulfill nutrition bars, PAYDAY bars and our sweets portfolio.

好時在各個貿易類別中擁有強大的分佈，包括在消費者增加出行的管道（例如一元商店、俱樂部店和折扣店）中佔有一席之地。我們越來越關注這些管道，並與零售商合作，以利用籃子裡零食和糖果的增量。我們也致力於打造能夠滿足消費者對價值和滿足感需求的品牌，包括 Dot's Pretzels、ONE 和 Fulfill 營養棒、PAYDAY 棒以及我們的糖果產品組合。

With more stable supply chain performance and increased capacity, our teams are evaluating price pack architecture opportunities to ensure we have the right offerings and price points to meet consumers' changing needs. And we are looking to optimize our investments in trade and media to ensure we have the right mix of each along with the right price points, in-store execution and brand equity to drive profitable growth.

隨著供應鏈性能更加穩定和產能增加，我們的團隊正在評估價格包架構機會，以確保我們擁有合適的產品和價格點來滿足消費者不斷變化的需求。我們正在尋求優化我們在貿易和媒體方面的投資，以確保我們擁有正確的組合以及正確的價格點、店內執行和品牌資產，以推動獲利成長。

Now let me provide a few details on each of our segments. Within North America Confectionery, everyday chocolate sales growth slowed in the third quarter as elasticity increased, as expected. We continue to plan for more historical price elasticity in Q4 and 2024. The category has also been impacted by distribution and merchandising reductions at a key retailer over the past several months.

現在讓我提供每個細分市場的一些詳細資訊。在北美糖果業中，正如預期的那樣，由於彈性增加，第三季日常巧克力銷量成長放緩。我們繼續計劃在第四季度和 2024 年實現更大的歷史價格彈性。過去幾個月，該類別也受到一家主要零售商的分銷和商品減少的影響。

Given Hershey's high share of merchandising and strong gains over the past several years, we have been disproportionately impacted by this change. We are actively partnering to develop solutions that enable our retailers to meet their goals while also capitalizing on the incrementality and expandable nature of our high-margin category to optimize results in 2024.

鑑於好時在過去幾年中的高銷售份額和強勁收益，我們受到這項變化的影響尤為嚴重。我們正在積極合作開發解決方案，使我們的零售商能夠實現他們的目標，同時利用我們高利潤類別的增量和可擴展性來優化 2024 年的業績。

As we exit the year, we expect confection retail trends to improve as consumers prioritize seasonal traditions and in-store seasonal merchandising levels remain comparable to prior year.

隨著今年的結束，我們預計糖果零售趨勢將會改善，因為消費者優先考慮季節性傳統，店內季節性商品銷售水準與去年相當。

Hershey Halloween retail sales to date are up slightly versus prior year, and we are outperforming the category. Consumers have returned to purchasing their trick-or-treat candy closer to Halloween after supply chain and availability concerns spurred earlier purchases last year. With Halloween next Tuesday, we still have several important selling days to go and our teams are hard at work ensuring consumers have all their favorite treats to buy for this important holiday. This includes our amazing retail team members and a record number of corporate and other nonretail employee volunteers helping set up merchandising displays and filling store shelves.

迄今為止，好時萬聖節零售額比去年略有上升，我們的表現優於該類別。在供應鏈和供應問題刺激了去年早些時候的購買之後，消費者在萬聖節臨近時又開始購買「不給糖就搗蛋」的糖果。下週二是萬聖節，我們還有幾個重要的銷售日，我們的團隊正在努力確保消費者在這個重要的節日中買到所有他們最喜歡的禮物。這包括我們出色的零售團隊成員以及數量創紀錄的企業和其他非零售員工志願者，他們幫助設置商品展示和填充商店貨架。

Thank you to all of our employees who work so hard every day to help create and be a part of these special moments of goodness.

感謝我們所有每天辛勤工作的員工，他們幫助創造並參與了這些特殊的美好時刻。

Shifting to our everyday non-chocolate portfolio, Hershey sweets retail sales grew nearly 9% in the quarter as category trends remain favorable and strong innovation is helping us secure incremental distribution.

轉向我們的日常非巧克力產品組合，好時糖果零售額在本季度增長了近 9%，因為類別趨勢仍然有利，而且強大的創新正在幫助我們確保增量分銷。

Hershey gum and mint products grew nearly 12% as the category continues to rebound from lower mobility.

好時口香糖和薄荷產品成長了近 12%，因為該類別繼續從較低的流動性中反彈。

Hershey growth is outpacing the category due to improved supply chain performance versus the prior year period. We expect both sweets and refreshment to continue to perform well in the fourth quarter.

由於供應鏈績效較上年同期有所改善，好時的成長速度超過了同類產品。我們預計糖果和茶點在第四季將繼續表現良好。

Within our North America Salty Snacks segment, our teams did an excellent job building inventory in the quarter to prepare for our October ERP transition and a fantastic job with implementation. The new system is now up and running, and we are successfully taking and shipping orders.

在我們的北美鹹味零食部門，我們的團隊在本季度出色地建立了庫存，為 10 月的 ERP 過渡做好了準備，並且在實施方面也表現出色。新系統現已啟動並運行，我們正在成功接收和發貨訂單。

Dot's Pretzels had a terrific quarter, driven by strong category growth and share gains in both measured and nonmeasured channels. After a successful test over the past several months, Dot's secured permanent distribution in a club retailer, helping drive overall retail sales growth of 36% in the quarter.

Dot's Pretzels 在強勁的品類成長以及可衡量和非可衡量通路的佔有率成長的推動下，度過了一個出色的季度。經過過去幾個月的成功測試，Dot's 獲得了一傢俱樂部零售商的永久分銷，幫助推動本季整體零售額成長 36%。

While the pretzel category is performing well, the ready-to-eat popcorn and puff categories slowed considerably in the third quarter as back-to-school multipack purchases were muted and consumers shifted to more filling salty snacks. SkinnyPop and Pirate's Booty were both impacted by these category trends.

雖然椒鹽捲餅類別表現良好，但即食爆米花和泡芙類別在第三季大幅放緩，因為返校後多包裝購買量減少，消費者轉向更飽腹的鹹味零食。 SkinnyPop 和 Pirate's Booty 都受到了這些類別趨勢的影響。

We expect Q4 Salty Snacks consumption trends to be comparable to Q3 with an additional net sales headwind related to the planned inventory drawdown associated with the ERP implementation.

我們預期第四季鹹味零食的消費趨勢將與第三季相當，但與 ERP 實施相關的計畫庫存減少會帶來額外的淨銷售阻力。

Within our International segment, growth decelerated across markets, reflecting heightened competitive activity and a moderation in category growth. Results were also impacted by our choice to exit a low-margin beverage product in Mexico earlier this year as well as timing of shipments in India and Brazil that shifted into the fourth quarter.

在我們的國際業務中，各市場的成長放緩，反映出競爭活動加劇和品類成長放緩。我們今年稍早選擇退出墨西哥的低利潤飲料產品，以及印度和巴西的出貨時間轉移到第四季度，也影響了業績。

Our teams remain focused on distribution expansion across markets and executing on seasonal orders to drive growth. We expect Q4 trends to be slightly better given shipment timing in India and Brazil, a new marketing activation in Australia and innovation launch in Europe and an easier year ago comparison.

我們的團隊仍然專注於跨市場的分銷擴張並執行季節性訂單以推動成長。鑑於印度和巴西的出貨時間、澳洲新的行銷活動和歐洲的創新推出以及與去年同期的比較，我們預計第四季度的趨勢將略有改善。

Before I turn it over to Steve, let me briefly touch on a few critical enterprise priorities. Our supply chain capacity initiatives remain on track for this year, and our incremental capacity has enabled us to meet customer seasonal demand, improve our service levels and lean in to productivity initiatives. We have a few projects already underway to complete in '24, but will then return to more historical levels of capital spending as utilization reaches our targeted level.

在將其交給史蒂夫之前，讓我先簡單介紹一下企業的一些關鍵優先事項。今年我們的供應鏈產能計劃仍按計劃進行，我們的增量產能使我們能夠滿足客戶的季節性需求，提高我們的服務水平並致力於生產力計劃。我們已經在進行一些項目，預計將在 2024 年完成，但隨著利用率達到我們的目標水平，資本支出將恢復到歷史水平。

After successful ERP implementations in Mexico last year and Salty this month, our teams are beginning to shift focus to our U.S. transition next spring. Our teams have already put in a tremendous amount of effort to prepare for this transition. With our cross-functional expertise and lessons learned from Mexico and Salty, we believe we are well positioned to successfully deliver this important milestone next year in our largest market.

去年在墨西哥和本月在 Salty 成功實施 ERP 後，我們的團隊開始將重點轉移到明年春天的美國過渡。我們的團隊已經付出了巨大的努力來為這一轉變做好準備。憑藉我們的跨職能專業知識以及從墨西哥和 Salty 汲取的經驗教訓，我們相信明年我們有能力在我們最大的市場成功實現這一重要里程碑。

Steve, let me now turn it over to you for more perspective on our financial results and outlook.

史蒂夫，現在讓我把它交給你，讓你更了解我們的財務表現和前景。

Thank you, Michele, and good morning, everyone. In the third quarter, we delivered 11.1% net sales growth and 19.8% adjusted earnings per share growth, a reflection of our team's ability to adapt and execute in an evolving consumer environment.

謝謝米歇爾，大家早安。第三季度，我們的淨銷售額成長了 11.1%，調整後每股盈餘成長了 19.8%，這反映了我們團隊在不斷變化的消費者環境中適應和執行的能力。

Our North America Confectionery segment delivered organic constant currency sales growth of 10.1%. Price realization contributed 11 points of growth to the quarter. We will begin to lap 2022 price increases in the fourth quarter and therefore expect pricing to moderate slightly and be a high single-digit benefit versus a year ago. Volume was a 1% headwind in the segment, slightly better than expected due to the timing of seasonal shipments from Q4.

我們的北美糖果部門實現了 10.1% 的有機固定貨幣銷售額成長。價格實現為本季貢獻了 11 個百分點的成長。我們將在第四季度開始經歷 2022 年的價格上漲，因此預計價格將略有放緩，並與一年前相比出現較高的個位數收益。該領域的銷量下降了 1%，由於第四季度開始的季節性發貨時間，略好於預期。

Overall, seasonal growth contributed nearly half of segment growth in the quarter along with strong growth in nonmeasured channels, which helped offset everyday declines driven by price elasticity.

總體而言，季節性成長貢獻了本季細分市場成長的近一半，加上非衡量管道的強勁成長，有助於抵消價格彈性驅動的日常下降。

Our North America Salty Snacks segment organic constant currency net sales growth of 25.5% reflects an approximate 16-point benefit from planned inventory increases ahead of our ERP implementation. The base business grew mid-single digits, aided by new Dot's distribution in the club channel.

我們的北美鹹味零食部門按固定匯率計算淨銷售額增長 25.5%，反映出我們在 ERP 實施之前計劃的庫存增加帶來了約 16 個百分點的收益。由於 new Dot 在俱樂部通路的分銷，基礎業務實現了中個位數成長。

We continue to expect fourth quarter organic sales to decline low double digits as we ship below consumption as we emerge from the ERP transition and execute fewer promotional programs.

我們繼續預計第四季度有機銷售額將下降兩位數，因為我們的出貨量低於消耗量，因為我們擺脫了 ERP 轉型並執行了更少的促銷計劃。

Organic constant currency sales for our International segment declined 1.2%. This partly reflects planned items such as the discontinuation of a dairy beverage product line in Mexico and a later holiday season in India in addition to heightened competitive activity in several key markets as category growth moderated.

以固定匯率計算，我們國際部門的有機銷售額下降了 1.2%。這在一定程度上反映了計劃中的項目，例如墨西哥乳飲​​料產品線的停產和印度假期的推遲，此外，隨著品類增長放緩，幾個關鍵市場的競爭活動加劇。

We expect sequential volume improvement in the fourth quarter, driven by strong Diwali and Ramadan shipments as well as incremental activations and innovation in targeted markets, which should more than offset a 4-point headwind from the exit of the Mexico beverage product line. For the full year, our overall net sales outlook of around 8% is unchanged. In the fourth quarter, we expect everyday elasticity to be in line with historical levels and shipments to lag consumption due to the seasonal timing we discussed earlier as well as normalization of inventory levels.

我們預計，在排燈節和齋月出貨量強勁以及目標市場增量激活和創新的推動下，第四季度銷量將連續改善，這將足以抵消墨西哥飲料產品線退出帶來的4 個百分點的不利影響。就全年而言，我們對 8% 左右的整體淨銷售額預期保持不變。在第四季度，由於我們之前討論的季節性時間以及庫存水平正常化，我們預計日常彈性將與歷史水平保持一致，並且出貨量將落後於消費。

Moving down the P&L. Adjusted gross margin increased 240 basis points in the third quarter as pricing and productivity gains more than offset inflation and higher manufacturing and overhead costs. This was slightly ahead of our expectations due to fixed cost leverage, timing of productivity and sourcing mix as well as favorable manufacturing and logistics costs.

損益表向下移動。第三季調整後毛利率成長了 240 個基點，因為定價和生產力的提高足以抵消通貨膨脹以及更高的製造和管理成本。由於固定成本槓桿、生產力和採購組合的時機以及有利的製造和物流成本，這略高於我們的預期。

We now expect full year gross margin expansion at the high end of our previously communicated range of 80 to 90 basis points.

我們現在預計全年毛利率將達到先前通報的 80 至 90 個基點的上限。

Advertising and related consumer marketing increased 20% in the third quarter with investment up double digits across segments.

第三季廣告和相關消費者行銷成長了 20%，各個細分市場的投資成長了兩位數。

Adjusted operating expenses, excluding advertising and related consumer marketing spend, increased 8.1% driven by compensation and benefits inflation as well as incremental capability and technology investments.

受薪資和福利通膨以及增量能力和技術投資的推動，調整後的營運支出（不包括廣告和相關消費者行銷支出）增加了 8.1%。

Looking to the fourth quarter, we expect advertising spend to grow double digits as we continue our strong support for sell-through of seasonal items and begin to reactivate our Salty Snacks brands coming out of our ERP transition.

展望第四季度，隨著我們繼續大力支持季節性商品的銷售，並開始在 ERP 轉型後重新激活鹹味零食品牌，我們預計廣告支出將增長兩位數。

We expect nonadvertising SG&A spend to increase low single digits, reflecting a small increase in technology and capability investments.

我們預期非廣告銷售、一般行政開支將成長低個位數，反映出技術和能力投資的小幅成長。

The adjusted tax rate for the third quarter was 20.4%, an increase of 450 basis points versus the year ago period. This increase was primarily driven by fewer renewable energy tax credits in the quarter versus the prior year.

第三季調整後稅率為20.4%，較去年同期增加450個基點。這一增長主要是由於本季可再生能源稅收抵免額較上一年減少。

While our net overall tax outlook is relatively unchanged, we now anticipate a full year adjusted tax rate of approximately 15% and other expense to be in the $225 million to $230 million range. Remember that other expense primarily reflects the write-down of the renewable energy investments that qualify for tax credit.

雖然我們的整體淨稅收前景相對不變，但我們目前預計全年調整後稅率約為 15%，其他費用將在 2.25 億美元至 2.3 億美元之間。請記住，其他費用主要反映了符合稅收抵免資格的再生能源投資的減記。

Given our visibility into seasonal shipments, incremental distribution and inventory and inflation headwinds in Q4, our full year outlook for adjusted earnings per share growth remains at 11% to 12%, consistent with our prior outlook.

鑑於我們對第四季度季節性發貨、增量分銷以及庫存和通膨不利因素的了解，我們對調整後每股收益增長的全年預期仍為 11% 至 12%，與我們先前的預期一致。

Capital additions, including software, were $218 million in Q3, supporting our previously discussed capacity expansion projects and ERP implementation. Our full year capital spending outlook is unchanged. As Michele mentioned, the second half of 2023 represents a high watermark for capital spending as several capacity projects near completion.

第三季的資本增加（包括軟體）為 2.18 億美元，支持我們先前討論的產能擴張項目和 ERP 實施。我們的全年資本支出前景保持不變。正如 Michele 所提到的，隨著多個產能項目即將完成，2023 年下半年資本支出將達到高點。

We remain committed to our capital allocation priorities, including reinvestment for growth, dividends and share repurchases. In the quarter, dividends paid to shareholders totaled $238 million, an increase of 14.8% versus the prior year period. The company did not repurchase any shares in the third quarter against our May 2021 $500 million authorization and $370 million remains.

我們仍然致力於我們的資本配置優先事項，包括成長再投資、股息和股票回購。本季向股東支付的股利總額為2.38億美元，較上年同期成長14.8%。根據我們 2021 年 5 月授權的 5 億美元，該公司在第三季沒有回購任何股票，仍有 3.7 億美元。

As the operating environment continues to evolve, I'm confident that our teams and our business will continue to respond with agility and excellence to deliver another year of differentiated results.

隨著營運環境的不斷發展，我相信我們的團隊和業務將繼續敏捷、卓越地做出反應，在新的一年中取得差異化的成果。

With that, I will turn it back to Michele for closing remarks.

接下來，我將把它轉回給米歇爾做總結發言。

Thanks, Steve. The environment remains very dynamic. We are focused on identifying and responding to these changes to ensure we have the right portfolio, the right strategies and the right talent to meet the changing needs of our consumers for many years to come.

謝謝，史蒂夫。環境仍然充滿活力。我們專注於識別和應對這些變化，以確保我們擁有正確的產品組合、正確的策略和合適的人才，以滿足未來許多年消費者不斷變化的需求。

We will continue to invest in our brands and our capabilities to drive sustainable long-term growth, while at the same time having a relentless focus on prioritization and efficiency to get the most out of our resources.

我們將繼續投資於我們的品牌和能力，以推動可持續的長期成長，同時不懈地專注於優先順序和效率，以充分利用我們的資源。

We have iconic brands in great categories, strong margins and financial flexibility to invest for the future. We thank you for your continued support and interest in the company.

我們擁有優質品類的標誌性品牌、強勁的利潤率以及投資未來的財務彈性。我們感謝您對公司的持續支持和關注。

I invite you to listen to our live question-and-answer webcast, which will begin today at 8:30 a.m. Eastern Time and will be available at thehersheycompany.com. Thank you.

我邀請您收聽我們的現場問答網路廣播，該廣播將於東部時間今天上午 8:30 開始，並可在 thehersheycompany.com 上觀看。謝謝。