Hormel Foods Corporation, a leading producer of meat and food products, has been negatively affected by inflation and supply chain issues, resulting in lower sales volumes and declining financial performance in the first quarter of fiscal 2023.
The company’s earnings per share (EPS) guidance range for fiscal 2023 has been lowered due to high inefficiencies in the supply chain, resulting in increased inventory levels and softness in the snack nuts unit.
The company’s pricing actions continue to lag inflation, and volumes have fallen across all segments. Hormel Foods has implemented initiatives to counter these challenges, such as increased brand investments and innovation, boosting capacity and stabilizing margin pressures through cost management and supply chain cost savings initiatives. However, it remains to be seen if these actions will mitigate the aforementioned issues.