McCormick & Company, Incorporated (NYSE:MKC) Q4 2014 Earnings Conference Call - Final Transcript

Jan 28, 2015 • 08:00 am ET


McCormick & Company, Incorporated (NYSE:MKC) Q4 2014 Earnings Conference Call - Final Transcript


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Joyce Brooks

Good morning. This is Joyce Brooks, Vice President of Investor Relations. Thank you for joining today's call for a discussion of McCormick's Fourth Quarter Financial Results and our Outlook for 2015. We've posted a set of slides to accompany our call at

At this time, all participants are in a listen-only mode. A question-and-answer session will follow our remarks.

[Operator Instructions]

As a reminder, the conference is being recorded. With me this morning are Alan Wilson, Chairman and CEO; Gordon Stetz, Executive Vice President and Chief Financial Officer; Lawrence Kurzius, Chief Operating Officer and President; and Mike Smith, Senior Vice President Finance Capital Markets and CFO North America. During our remarks, we will refer to non-GAAP financial measures. These include adjusted operating income and adjusted earnings per share that exclude the impact of special charges in a 2013 loss on voluntary pension settlement. A reconciliation to the GAAP results is included in this morning's press release, as well as the slides that accompany this call. As a reminder, today's presentation contains projections and other forward-looking statements. Actual results could differ materially from those projected. The Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or other factors. As seen on Slide 2, our forward-looking statements also provide information on risk factors that could affect our financial results. It's now my pleasure to turn the discussion over to Alan.

Alan Wilson

Thank you, Joyce. Good morning, everyone and thanks for joining us. I'd like to start by also welcoming Lawrence to this morning's call. In addition to his continuing role as President of our Global Consumer business, Lawrence now has responsibility for our businesses worldwide in his newly appointed role of COO and President. At the end of our remarks, I may ask him to weigh in on some of your questions.

While he is not on this call, I'd like to also congratulate Malcolm Swift on the formulization of his position as President, Global Industrial. Malcolm continues to have geographic responsibility for our businesses in Europe, the Middle East and Africa and in Asia Pacific. In 2014, McCormick delivered solid financial performance, despite a difficult environment. Our on-trend categories are growing in markets around the world, with increasing consumer demand for flavor.

We're driving growth in sales and profit and in 2015 are stepping up our cost reduction activities to fuel our growth.

During the fourth quarter of 2014, we made progress on a number of fronts, with the successful launch of new products, additional investment in brand marketing to drive growth and building customer intimacy. For the fiscal year, our cash flow exceeded $500 million and we returned a record amount of cash to shareholders, employees throughout McCormick delivered $65 million in cost savings from our Comprehensive Continuous Improvement program, CCI and we have embarked on a more aggressive cost savings plans for 2015.

Fourth quarter earnings per share exceeded the guidance we provided back in October with a