Categories Consumer, Earnings

What to expect when McCormick & Company (MKC) reports Q1 results next week

The consensus estimate is for EPS of $0.51 in Q1 2023

Shares of McCormick & Company, Incorporated (NYSE: MKC) were up over 2% on Friday. The stock has dropped 12% year-to-date. The condiments manufacturer is scheduled to report its first quarter 2023 earnings results on Tuesday, March 28, before market open. Here’s a look at what to expect from the earnings report:


Analysts are projecting net sales of $1.54 billion for McCormick for the first quarter of 2023. This compares to $1.52 billion reported in the same period a year ago. In the fourth quarter of 2022, net sales dropped 2% year-over-year to $1.69 billion.



The consensus estimate is for EPS of $0.51 in Q1 2023 which compares to adjusted EPS of $0.63 reported in the year-ago quarter. In Q4 2022, adjusted EPS fell 13% YoY to $0.73.

Points to note

In Q4 2022, McCormick faced headwinds from inflation and supply chain challenges along with pandemic-related disruptions and geopolitical factors. These factors would have pressured the business in the first quarter of 2023 but the company’s efforts in tackling inflation through price increases and cost savings may have helped in partly cushioning these impacts.

On its Q4 conference call, the company said it expects adjusted operating profit growth to be pressured in Q1. It also said the impact of cost inflation would be weighted towards the first half with peak inflation in Q1. In addition, it anticipates Q1 sales and profits to be impacted by COVID-related headwinds in China and the exit of the consumer business in Russia.    

McCormick saw its reported gross margin decline by 380 basis points in Q4 due to higher cost inflation and other supply chain costs. This was partly offset by pricing actions and cost savings implemented through the company’s Comprehensive Continuous Improvement (CCI) program.

On the other hand, McCormick continues to benefit from the trend of consumers cooking meals at home and their increasing demand for flavor, which led to strong consumption trends along with sales growth at its Flavor Solutions segment in Q4. This, combined with a broad portfolio, gives the company a meaningful advantage and positions it for growth in the upcoming fiscal year.

Looking for more insights on the earnings results? Click here to access the full transcripts of the latest earnings conference calls!

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