HORMEL FOODS REPORTS SECOND QUARTER FISCAL 2025 RESULTS

Company Achieved Solid Top-Line Growth; Positioned for Strong Second Half Narrows Fiscal 2025 Net Sales and Earnings Outlook , /PRNewswire/ -- Hormel Foods Corporation (NYSE: HRL), a Fortune 500 global branded food company, today reported results for the second quarter of fiscal 2025, which ended April 27, 2025. All comparisons are to the comparable period of fiscal 2024, unless otherwise noted. EXECUTIVE SUMMARY — FIRST HALF Net sales of $5.89 billion; organic net sales1 up 1% Operating income of $477 million; adjusted operating income1 of $519 million Operating margin of 8.1%; adjusted operating margin1 of 8.8% Earnings before income taxes of $449 million; adjusted earnings before income taxes1 of $491 million Effective tax rate of 21.9% Diluted earnings per share of $0.64; adjusted diluted earnings per share1 of $0.70 Cash flow from operations of $366 million EXECUTIVE SUMMARY — SECOND QUARTER Net sales of $2.90 billion; organic net sales1 up 1% Operating income of $248 million; adjusted operating income1 of $265 million Operating margin of 8.6%; adjusted operating margin1 of 9.1% Earnings before income taxes of $230 million; adjusted earnings before income taxes1 of $247 million Effective tax rate of 22.0% Diluted earnings per share of $0.33; adjusted diluted earnings per share1 of $0.35 Cash flow from operations of $56 million EXECUTIVE COMMENTARY "We achieved solid organic top-line growth and delivered second quarter results in line with our expectations," said Jim Snee, president and chief executive officer. "We anticipate strong second half growth led by our range of consumer-focused, protein-centric products. Notably, we expect meaningful contributions from our turkey portfolio, continued momentum in the Planters® brand, growth from our leading positions in the marketplace and ongoing benefits from our Transform and Modernize (T&M) initiative. In the face of a dynamic environment, we remain confident in our portfolio, our strategy and our team." FISCAL 2025 OUTLOOK For fiscal year 2025, the Company is: Narrowing its organic net sales1 growth outlook to 2% to 3% Narrowing its diluted earnings per share expectations to $1.49 to $1.59 Narrowing its adjusted diluted earnings per share1 expectations to $1.58 to $1.68 Reaffirming its outlook of year over year T&M benefits in the range of $100 million to $150 million Fiscal 2025 Outlook Revised Previous Net Sales $12.0 - $12.2 billion $11.9 - $12.2 billion Diluted Earnings per Share $1.49 - $1.59 $1.49 - $1.63 Adj. Diluted Earnings per Share1 $1.58 - $1.68 $1.58 - $1.72 PROGRESS EXECUTING STRATEGIC PRIORITIES – Q2 HIGHLIGHTS Drive focus and growth in our Retail business The Applegate® brand performed well in the second quarter, as consumption growth outpaced the total edible category2 while also gaining households.3 The team's commitment to delivering high-quality products in convenient formats is evident in previous launches like frozen breakfast sandwiches and the newly launched lightly breaded chicken. The Jennie-O® ground turkey business experienced notable retail sales growth relative to last year4 and remains well-positioned to grow in today's environment. As demand for lean, high-protein offerings continues to rise, we believe Jennie-O® lean ground turkey will continue to be a preferred choice of consumers and retain its strong category leadership position. Our Mexican foods portfolio delivered strong year over year growth in the second quarter, driven by double-digit consumption growth in our combined Wholly® and Herdez® refrigerated guacamole products and continued success in Herdez® salsa.4 To further enhance our offerings, the team extended our Herdez® refrigerated entrees line with the bold and authentic flavor of al pastor, an exciting, globally-inspired meal solution. Expand leadership in Foodservice Our Foodservice team again highlighted its innovative leadership during the quarter, bringing on-trend solutions for operators at the International Pizza Expo. The team showcased the new Fontanini® hot honey sliced sausage, providing operators with a trusted offering to deliver the hot honey flavor that consumers are craving. Our Flash 180™ chicken is designed to streamline back-of-the-house operations. During the quarter, it continued to be a game-changing solution for operators, simplifying preparation for the most in-demand menu item — the chicken sandwich.5 Aggressively develop our global presence Our in-country China business performed well in the quarter, driven by customer and distribution expansion, alongside the introduction of innovative product offerings. The launch of Hormel® barbecue bites, for example, demonstrates our team's deep understanding of consumer trends and their ability to create meaningful innovations that address market demands. Execute our enterprise entertaining & snacking vision The Planters® brand continued to see sequential improvement in both distribution and overall retail sales4 in the quarter. This momentum reflects the brand's strength in the marketplace and growth potential. We introduced innovative snacking experiences this quarter by launching Corn Nuts® partially popped corn kernels – blending the signature crunch of Corn Nuts® with the airy texture of popcorn in three flavor-packed varieties. We also expanded our Hormel Gatherings® line with a bold and spicy tray, meeting consumer demand for bold flavors and convenient, high-quality entertaining options. Continue to transform & modernize our Company We successfully began operations at our new distribution center in the Memphis, Tennessee, metro-area. This strategically located facility allows us to better service our customers with greater speed, meeting the growing demand and expectations for timely deliveries. As part of our continuous review of assets and cost structure, we announced the closure of a California dry sausage production facility, and the movement of related production to other internal facilities. We believe this network optimization project will allow us to continue to create high-quality products for consumers while controlling costs and best serving our customers. SEGMENT HIGHLIGHTS – SECOND QUARTER Retail Volume down 7% Net sales flat Segment profit up 4% Net sales in the second quarter of fiscal 2025 were comparable to the prior year, as high-single-digit growth from both our Mexican portfolio and value-added turkey products was primarily offset by the impacts of promotional timing. Two-thirds of the Retail segment's volume decline in the quarter was due to lower commodity shipments and contract manufacturing. Flagship and rising brands continued to hold leadership positions in their respective categories in the quarter. Notably, the Planters® brand exceeded volume and net sales expectations for the second quarter, while demand for Jennie-O® lean ground turkey remained strong. Retail segment profit increased in the second quarter of fiscal 2025, primarily due to benefits from operational efficiencies as part of the T&M initiative and favorable selling, general and administrative expenses. Foodservice Volume down 7%; organic volume1 down 1% Net sales flat; organic net sales1 up 4% Segment profit down 6% Organic net sales1 growth was broad-based in the Foodservice segment in the second quarter of fiscal 2025, with notable contributions from the customized solutions business and the turkey portfolio. Branded products such as Jennie-O®, Hormel® Fire Braised™ meats and Café H® globally inspired proteins delivered another quarter of strong volume and net sales growth. Several categories achieved volume growth in the second quarter of fiscal 2025, despite industry softness. Volume growth in these categories was more than offset by the impact of reduced commodity shipments. Segment profit decreased for the second quarter of fiscal 2025 as higher net sales were more than offset by margin pressures, primarily in non-core businesses. The Foodservice segment continued to benefit from an extensive range of solutions-based products, its direct-selling organization and a diverse channel presence during the second quarter. International Volume up 9% Net sales up 7% Segment profit down 21% Double-digit volume and net sales growth in exports, and robust growth in the China market drove top-line performance in the International segment in the second quarter of fiscal 2025. Strong shipments within the refrigerated portfolio, primarily of bacon and pepperoni, made the largest contribution to export growth. Our in-country China business continued to benefit from top-line momentum in both the retail and foodservice channels, supported by innovative product launches. International segment profit decreased in the second quarter of fiscal 2025 as meaningful net sales growth was primarily offset by a temporary shift in export customer mix and softness in Brazil. SELECTED FINANCIAL DETAILS – SECOND QUARTER FISCAL 2025 Advertising investments were $36 million, compared to $44 million last year. The decline was partially due to year over year timing impacts for investments in the Planters® brand. In the second half of fiscal 2025, the Company expects advertising investments to significantly increase compared to the prior year. The effective tax rate was 22.0%, compared to 22.5% last year, primarily due to higher federal deductions in the current year. The effective tax rate for fiscal 2025 is expected to be between 22.0% and 23.0%. Capital expenditures were $75 million, compared to $60 million last year. The largest projects in the quarter were related to capacity expansions for Hormel® Fire Braised™ products, Applegate® products, and investments in data and technology. The Company's target for capital expenditures in fiscal 2025 remains $275 million to $300 million. Depreciation and amortization expense was $64 million, comparable to last year. The full-year expectation for fiscal 2025 remains unchanged at approximately $265 million. The Company returned approximately $159 million to stockholders during the quarter through dividends. PRESENTATIONA conference call will be webcast at 8:00 a.m. CT on May 29, 2025. Access is available at www.hormelfoods.com by clicking on "Investors." The call will also be available via telephone by dialing 800-549-8228 (toll-free) or 646-564-2877 (international) and providing the conference ID 97177. An audio replay is available at www.hormelfoods.com. The webcast replay will be available at noon CT, May 29, 2025, and will remain on the website for one year. ABOUT HORMEL FOODS - Inspired People. Inspired Food.™Hormel Foods Corporation, based in Austin, Minnesota, is a global branded food company with approximately $12 billion in annual revenue across more than 80 countries worldwide. Its brands include Planters®, Skippy®, SPAM®, Hormel® Natural Choice®, Applegate®, Justin's®, Wholly®, Hormel® Black Label®, Columbus®, Jennie-O® and more than 30 other beloved brands. The company is a member of the S&P 500 Index and the S&P 500 Dividend Aristocrats, was named one of the best companies to work for by U.S. News & World Report, one of America's most responsible companies by Newsweek, recognized by TIME magazine as one of the World's Best Companies and has received numerous other awards and accolades for its corporate responsibility and community service efforts. The company lives by its purpose statement — Inspired People. Inspired Food.™ — to bring some of the world's most trusted and iconic brands to tables across the globe. For more information, visit hormelfoods.com. FORWARD-LOOKING STATEMENTSThis press release contains "forward-looking" information within the meaning of the federal securities laws. The "forward-looking" information may include statements concerning the Company's outlook for the future as well as other statements of beliefs, future plans, strategies, or anticipated events and similar expressions concerning matters that are not historical facts. Words or phrases such as "should result," "believe," "intend," "plan," "are expected to," "targeted," "will continue," "will approximate," "is anticipated," "estimate," "project," or similar expressions are intended to identify forward-looking statements. Such statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical earnings and those anticipated or projected, which factors include, but are not limited to, risks related to the deterioration of economic conditions; risks associated with acquisitions, joint ventures, equity investments, and divestitures; risks and uncertainties associated with intangible assets, including any future goodwill or intangible assets impairment charges; the risk of disruption of operations, including at owned facilities, co-manufacturers, suppliers, logistics providers, customers, or other third-party service providers; the risk that the Company may fail to realize anticipated cost savings or operating profit improvements associated with strategic initiatives, including the Transform and Modernize initiative; risk of loss of a significant contract or unfavorable changes in the Company's relationships with significant customers; risk of the Company's inability to protect information technology (IT) systems against, or effectively respond to, cyber attacks, security breaches or other IT interruptions, against or involving the Company's IT systems or those of others with whom it does business; risk of the Company's failure to timely replace legacy technologies; deterioration of labor relations or labor availability or increases to labor costs; general risks of the food industry, including those related to food safety, such as costs resulting from food contamination, product recalls, the remediation of food safety events at its facilities, including the production disruption at the Suffolk, Virginia, facility, food-specific laws or regulations, or outbreaks of disease among livestock and poultry flocks; fluctuations in commodity prices and availability of raw materials and other inputs; fluctuations in market demand for the Company's products, including due to private label products and lower-priced alternatives; risks related to the Company's ability to respond to changing consumer preferences, diets and eating patterns, and the success of innovation and marketing investments; damage to the Company's reputation or brand image; risks associated with climate change, or legal, regulatory, or market measures to address climate change; risks of litigation; potential sanctions and compliance costs arising from government regulation; compliance with stringent environmental regulations and potential environmental litigation; and risks arising from the fact that the Company operates globally, with product manufactured and sold in foreign markets and a variety of inputs sourced from around the world, these risks including geopolitical risk, exchange rate risk, legal, tax, and regulatory risk, and risks associated with trade policies, export and import controls, and tariffs. Please refer to the cautionary statements regarding "Risk Factors" and "Forward-Looking Statements" that appear in our most recent Annual Report on Form 10-K and Quarterly reports on Form 10-Q, which can be accessed at www.hormelfoods.com in the "Investors" section, for additional information. In making these statements, the Company is not undertaking, and specifically declines to undertake, any obligation to address or update each or any factor in future filings or communications regarding the Company's business or results, and is not undertaking to address how any of these factors may have caused changes to discussions or information contained in previous filings or communications. Though the Company has attempted to list comprehensively these important cautionary risk factors, the Company wishes to caution investors and others that other factors may in the future prove to be important in affecting the Company's business or results of operations. The Company cautions readers not to place undue reliance on forward-looking statements, which represent current views as of the date made. Note: Due to rounding, numbers presented throughout this press release may not sum precisely to the totals provided, and percentages may not precisely reflect the absolute figures. END NOTES 1 Non-GAAP measure. Organic volume and organic net sales exclude the impact of the sale of Hormel Health Labs, LLC in the Foodservice segment in the fourth quarter of fiscal 2024. Adjusted performance measures exclude non-recurring impacts of the Company's Transform and Modernize initiative, loss on sale of business, and legal matters. See Appendix: Non-GAAP Measures to this press release for more information. 2 Data aggregated from NielsenIQ Discover, Total US xAOC, 13 weeks ended 4/26/2025, SPINS Satori, Total US Natural, 12 weeks ended 4/20/2025 3 Circana HH Panel, Total US All Outlets, 52 weeks ended 4/20/2025 4 Circana Total US MULO+; 13 weeks ended 4/20/2025 5 Technomic Ignite Menu data Q1 2025 HORMEL FOODS CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS In thousands, except per share amounts Unaudited Quarter Ended Six Months Ended April 27, 2025 April 28, 2024 April 27, 2025 April 28, 2024 Net Sales $ 2,898,810 $ 2,887,352 $ 5,887,623 $ 5,884,263 Cost of Products Sold 2,414,377 2,383,546 4,927,957 4,871,723 Gross Profit 484,433 503,806 959,666 1,012,539 Selling, General, and Administrative 251,432 266,668 514,445 507,054 Equity in Earnings of Affiliates 15,350 15,182 31,461 31,273 Operating Income 248,352 252,320 476,682 536,758 Interest and Investment Income 1,653 13,497 10,857 32,932 Interest Expense 19,516 21,679 38,977 40,005 Earnings Before Income Taxes 230,489 244,139 448,561 529,685 Provision for Income Taxes 50,747 54,931 98,289 121,749 Effective Tax Rate 22.0 % 22.5 % 21.9 % 23.0 % Net Earnings 179,742 189,207 350,272 407,936 Less: Net Earnings (Loss) Attributable to Noncontrolling Interest (275) (70) (320) (204) Net Earnings Attributable to Hormel Foods Corporation $ 180,017 $ 189,278 $ 350,592 $ 408,140 Net Earnings Per Share Basic $ 0.33 $ 0.35 $ 0.64 $ 0.75 Diluted $ 0.33 $ 0.34 $ 0.64 $ 0.74 Weighted-average Shares Outstanding Basic 550,277 547,868 549,868 547,444 Diluted 550,611 548,685 550,233 548,303 Dividends Declared Per Share $ 0.2900 $ 0.2825 $ 0.5800 $ 0.5650 HORMEL FOODS CORPORATION CONSOLIDATED CONDENSED STATEMENTS OF FINANCIAL POSITION In thousands Unaudited April 27, 2025 October 27, 2024 Assets Cash and Cash Equivalents $ 669,688 $ 741,881 Short-term Marketable Securities 29,293 24,742 Accounts Receivable 743,981 817,908 Inventories 1,729,237 1,576,300 Taxes Receivable 50,529 50,380 Prepaid Expenses and Other Current Assets 59,341 35,265 Total Current Assets 3,282,069 3,246,476 Goodwill 4,920,635 4,923,487 Intangible Assets 1,724,810 1,732,705 Pension Assets 196,736 205,964 Investments in Affiliates 682,810 719,481 Other Assets 422,903 411,889 Net Property, Plant, and Equipment 2,191,843 2,194,728 Total Assets $ 13,421,808 $ 13,434,729 Liabilities and Shareholders' Investment Accounts Payable & Accrued Expenses $ 770,245 $ 801,984 Accrued Marketing Expenses 119,092 108,156 Employee-related Expenses 239,392 283,490 Interest and Dividends Payable 180,561 175,941 Taxes Payable 11,125 21,916 Current Maturities of Long-term Debt 7,249 7,813 Total Current Liabilities 1,327,664 1,399,299 Long-term Debt Less Current Maturities 2,850,697 2,850,944 Pension and Post-retirement Benefits 384,678 379,891 Deferred Income Taxes 594,504 589,366 Other Long-term Liabilities 222,324 211,219 Accumulated Other Comprehensive Loss (298,601) (263,331) Other Shareholders' Investment 8,340,542 8,267,342 Total Liabilities and Shareholders' Investment $ 13,421,808 $ 13,434,729 HORMEL FOODS CORPORATION CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS In thousands Unaudited Quarter Ended Six Months Ended April 27, 2025 April 28, 2024 April 27, 2025 April 28, 2024 Operating Activities Net Earnings $ 179,742 $ 189,207 $ 350,272 $ 407,936 Depreciation and Amortization 63,963 63,630 129,835 127,696 Decrease (Increase) in Working Capital (203,831) (36,790) (159,167) 78,611 Other 16,567 20,100 44,706 25,883 Net Cash Provided by (Used in) Operating Activities 56,441 236,147 365,646 640,127 Investing Activities Net Sale (Purchase) of Securities (3,349) (4,535) (4,735) (5,499) Proceeds from Sale of Business (504) — 13,139 — Purchases of Property, Plant, and Equipment (75,083) (59,965) (147,250) (107,175) Proceeds from (Purchases of) Affiliates and Other Investments (1,305) (450) (2,699) (450) Other 1,905 388 2,877 408 Net Cash Provided by (Used in) Investing Activities (78,336) (64,562) (138,668) (112,716) Financing Activities Proceeds from Long-term Debt — 497,765 — 497,765 Repayments of Long-term Debt and Finance Leases (2,043) (2,270) (4,245) (4,520) Dividends Paid on Common Stock (159,244) (154,741) (314,225) (305,035) Other 11,721 13,683 25,841 32,862 Net Cash Provided by (Used in) Financing Activities (149,566) 354,437 (292,629) 221,072 Effect of Exchange Rate Changes on Cash 752 (2,865) (6,542) 1,353 Increase (Decrease) in Cash and Cash Equivalents (170,710) 523,156 (72,193) 749,836 Cash and Cash Equivalents at Beginning of Year 840,398 963,212 741,881 736,532 Cash and Cash Equivalents at End of Period $ 669,688 $ 1,486,368 $ 669,688 $ 1,486,368 HORMEL FOODS CORPORATION SEGMENT DATA In thousands Unaudited Quarter Ended Six Months Ended April 27, 2025 April 28, 2024 % Change April 27, 2025 April 28, 2024 % Change Volume (lbs.) Retail 677,277 724,994 (6.6) 1,414,162 1,490,406 (5.1) Foodservice 242,595 261,832 (7.3) 486,449 517,839 (6.1) International 79,518 73,017 8.9 154,087 153,153 0.6 Total Volume (lbs.) 999,390 1,059,843 (5.7) 2,054,698 2,161,397 (4.9) Net Sales Retail $ 1,783,835 $ 1,788,556 (0.3) $ 3,673,968 $ 3,699,827 (0.7) Foodservice 936,442 932,003 0.5 1,866,627 1,845,090 1.2 International 178,533 166,794 7.0 347,028 339,346 2.3 Total Net Sales $ 2,898,810 $ 2,887,352 0.4 $ 5,887,623 $ 5,884,263 0.1 Segment Profit Retail $ 137,135 $ 132,399 3.6 $ 256,281 $ 281,904 (9.1) Foodservice 140,633 149,302 (5.8) 279,459 299,466 (6.7) International 18,407 23,202 (20.7) 39,252 43,234 (9.2) Total Segment Profit 296,175 304,903 (2.9) 574,992 624,603 (7.9) Net Unallocated Expense 65,411 60,694 7.8 126,111 94,714 33.1 Noncontrolling Interest (275) (70) (291.9) (320) (204) (56.7) Earnings Before Income Taxes $ 230,489 $ 244,139 (5.6) $ 448,561 $ 529,685 (15.3) APPENDIX: NON-GAAP MEASURESThis press release includes measures of financial performance that are not defined by U.S. generally accepted accounting principles (GAAP). The Company utilizes these non-GAAP measures to understand and evaluate operating performance on a consistent basis. These measures may also be used when making decisions regarding resource allocation and in determining incentive compensation. The Company believes these non-GAAP measures provide useful information to investors because they aid analysis and understanding of the Company's results and business trends relative to past performance and the Company's competitors. Non-GAAP measures are not intended to be a substitute for GAAP measures in analyzing financial performance. These non-GAAP measures are not calculated in accordance with GAAP and may be different from non-GAAP measures used by other companies. Transform and Modernize (T&M) InitiativeIn the fourth quarter of fiscal 2023, the Company announced a multi-year T&M initiative. In presenting non-GAAP measures, the Company adjusts for (i.e., excludes) expenses for this initiative that are non-recurring, which are primarily project-based external consulting fees and expenses related to supply chain and portfolio optimization (e.g., asset write-offs, severance, or relocation-related costs). The Company believes that non-recurring costs associated with the T&M initiative are not reflective of the Company's ongoing operating cost structure; therefore, the Company is excluding these discrete costs. The Company does not adjust for (i.e., does not exclude) certain costs related to the T&M initiative that are expected to continue after the project ends, such as software license fees and internal employee expenses, because those costs are considered ongoing in nature as a component of normal operating costs. The Company also does not adjust for savings realized through the T&M initiative as these are considered ongoing in nature and reflective of expected future operating performance. Loss on Sale of BusinessIn the first quarter of fiscal 2025, the Company sold Mountain Prairie, LLC, a non-core sow operation, resulting in a loss on the sale. The Company believes the one-time detriment from the sale, including transaction costs, is not reflective of the Company's ongoing operating cost structure, is not indicative of the Company's core operating performance, and is not meaningful when comparing the Company's operating performance against that of prior periods. Thus, the Company has adjusted for (i.e. excluded) the loss. Legal MattersFrom time to time, the Company incurs expenses related to discrete legal matters that the Company believes are not indicative of the Company's core operating performance, do not reflect expected future operating costs, and are not meaningful when comparing the Company's operating performance against that of prior periods. The Company adjusts for (i.e., excludes) these expenses. Litigation SettlementsIn the second quarter of fiscal 2024, the Company agreed to settle with three classes of plaintiffs in the pork antitrust litigation. In the first quarter of fiscal 2025, the Company entered into a settlement agreement with an additional plaintiff in this matter. Organic Volume and Organic Net SalesThe non-GAAP measures of organic volume and organic net sales are presented to provide investors with additional information to facilitate the comparison of past and present operations. Organic volume and organic net sales exclude the impact of the sale of Hormel Health Labs, LLC in the Foodservice segment in the fourth quarter of fiscal 2024. The tables below show the calculations to reconcile from the GAAP measures to the non-GAAP measures presented in this press release. The tax impacts were calculated using the effective tax rate for the quarter in which the transactions occurred. HORMEL FOODS CORPORATION RECONCILIATION OF NON-GAAP MEASURES Unaudited Quarter Ended Six Months Ended In thousands, except per share amounts April 27, 2025 April 28, 2024 April 27, 2025 April 28, 2024 Cost of Products Sold (GAAP) $ 2,414,377 $ 2,383,546 $ 4,927,957 $ 4,871,723 Transform and Modernize Initiative(1) (2,777) (1,823) (2,963) (3,420) Adjusted Cost of Products Sold (Non-GAAP) $ 2,411,600 $ 2,381,723 $ 4,924,994 $ 4,868,303 SG&A (GAAP) $ 251,432 $ 266,668 $ 514,445 $ 507,054 Transform and Modernize Initiative(2) (13,775) (10,021) (27,743) (18,736) Loss on Sale of Business — — (11,324) — Litigation Settlements — (11,750) (240) (11,750) Adjusted SG&A (Non-GAAP) $ 237,657 $ 244,898 $ 475,138 $ 476,568 Operating Income (GAAP) $ 248,352 $ 252,320 $ 476,682 $ 536,758 Transform and Modernize Initiative(1)(2) 16,552 11,843 30,706 22,156 Loss on Sale of Business — — 11,324 — Litigation Settlements — 11,750 240 11,750 Adjusted Operating Income (Non-GAAP) $ 264,903 $ 275,914 $ 518,952 $ 570,665 Earnings Before Income Taxes (GAAP) $ 230,489 $ 244,139 $ 448,561 $ 529,685 Transform and Modernize Initiative(1)(2) 16,552 11,843 30,706 22,156 Loss on Sale of Business — — 11,324 — Litigation Settlements — 11,750 240 11,750 Adjusted Earnings Before Income Taxes (Non-GAAP) $ 247,040 $ 267,732 $ 490,831 $ 563,591 Provision for Income Taxes (GAAP) $ 50,747 $ 54,931 $ 98,289 $ 121,749 Transform and Modernize Initiative(1)(2) 3,641 2,665 6,727 4,985 Loss on Sale of Business — — 2,469 — Litigation Settlements — 2,644 52 2,644 Adjusted Provision for Income Taxes (Non-GAAP) $ 54,388 $ 60,240 $ 107,537 $ 129,378 Net Earnings Attributable to Hormel Foods Corporation (GAAP) $ 180,017 $ 189,278 $ 350,592 $ 408,140 Transform and Modernize Initiative(1)(2) 12,910 9,179 23,979 17,171 Loss on Sale of Business — — 8,855 — Litigation Settlements — 9,106 188 9,106 Adjusted Net Earnings Attributable to Hormel Foods Corporation (Non-GAAP) $ 192,928 $ 207,562 $ 383,615 $ 434,418 Diluted Earnings Per Share (GAAP) $ 0.33 $ 0.34 $ 0.64 $ 0.74 Transform and Modernize Initiative(1)(2) 0.02 0.02 0.04 0.03 Loss on Sale of Business — — 0.02 — Litigation Settlements — 0.02 — 0.02 Adjusted Diluted Earnings Per Share (Non-GAAP) $ 0.35 $ 0.38 $ 0.70 $ 0.79 SG&A as a Percent of Net Sales (GAAP) 8.7 % 9.2 % 8.7 % 8.6 % Transform and Modernize Initiative(2) (0.5) (0.3) (0.5) (0.3) Loss on Sale of Business — — (0.2) — Litigation Settlements — (0.4) — (0.2) Adjusted SG&A as a Percent of Net Sales (Non-GAAP) 8.2 % 8.5 % 8.1 % 8.1 % Operating Margin (GAAP) 8.6 % 8.7 % 8.1 % 9.1 % Transform and Modernize Initiative(1)(2) 0.6 0.4 0.5 0.4 Loss on Sale of Business — — 0.2 — Litigation Settlements — 0.4 — 0.2 Adjusted Operating Margin (Non-GAAP) 9.1 % 9.6 % 8.8 % 9.7 % (1) Comprised primarily of asset write-offs and severance expenses related to supply chain and portfolio optimization. (2) Comprised primarily of project-based external consulting fees. ORGANIC VOLUME AND ORGANIC NET SALES (NON-GAAP) Quarter Ended April 27, 2025 April 28, 2024 In thousands GAAP GAAP Divestiture Non-GAAP Organic Non-GAAP % Change Volume (lbs.) Retail 677,277 724,994 — 724,994 (6.6) Foodservice 242,595 261,832 (16,585) 245,246 (1.1) International 79,518 73,017 — 73,017 8.9 Total Volume (lbs.) 999,390 1,059,843 (16,585) 1,043,258 (4.2) Net Sales Retail $ 1,783,835 $ 1,788,556 $ — $ 1,788,556 (0.3) Foodservice 936,442 932,003 (28,211) 903,792 3.6 International 178,533 166,794 — 166,794 7.0 Total Net Sales $ 2,898,810 $ 2,887,352 $ (28,211) $ 2,859,141 1.4 Six Months Ended April 27, 2025 April 28, 2024 In thousands GAAP GAAP Divestiture Non-GAAP Organic Non-GAAP % Change Volume (lbs.) Retail 1,414,162 1,490,406 — 1,490,406 (5.1) Foodservice 486,449 517,839 (32,516) 485,323 0.2 International 154,087 153,153 — 153,153 0.6 Total Volume (lbs.) 2,054,698 2,161,397 (32,516) 2,128,882 (3.5) Net Sales Retail $ 3,673,968 $ 3,699,827 $ — $ 3,699,827 (0.7) Foodservice 1,866,627 1,845,090 (55,109) 1,789,981 4.3 International 347,028 339,346 — 339,346 2.3 Total Net Sales $ 5,887,623 $ 5,884,263 $ (55,109) $ 5,829,154 1.0 Forward-looking GAAP to Non-GAAP MeasuresOur fiscal 2025 outlook for adjusted operating income and diluted earnings per share are non-GAAP measures that exclude, or have otherwise been adjusted for, items impacting comparability, including estimated charges associated with the T&M initiative and the loss on sale of business. The Company's strategic investments in the T&M initiative are expected to cease at the end of the investment period. The Company believes the one-time detriment from the sale, including transaction costs, is not reflective of the Company's ongoing operating cost structure. These items are not expected to recur in the foreseeable future and are not considered representative of the Company's underlying operating performance. The tables below show the calculation to reconcile from the estimated fiscal 2025 GAAP measure to the estimated non-GAAP adjusted measure. Fiscal 2025 Outlook In millions Revised Previous Operating Income (GAAP) $ 1,118 - $ 1,185 $ 1,118 - $ 1,212 Transform and Modernize Initiative 46 - 52 46 - 52 Loss on Sale of Business 11 - 11 11 - 11 Adjusted Operating Income (Non-GAAP) $ 1,175 - $ 1,248 $ 1,175 - $ 1,275 Fiscal 2025 Outlook Revised Previous Diluted Earnings per Share (GAAP) $1.49 - $1.59 $1.49 - $1.63 Transform and Modernize Initiative $0.07 $0.07 Loss on Sale of Business $0.02 $0.02 Adjusted Diluted Earnings per Share (Non-GAAP) $1.58 - $1.68 $1.58 - $1.72 SOURCE Hormel Foods Corporation WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM? 440k+ Newsrooms & Influencers 9k+ Digital Media Outlets 270k+ Journalists Opted In

HORMEL FOODS REPORTS SECOND QUARTER FISCAL 2025 RESULTS

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Why Bullish?

How important is it?

Why Long Term?

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