Hormel Foods Corporation (NYSE:HRL) Q4 2018 Earnings Conference Call Transcript

Nov 20, 2018 • 09:00 am ET

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Hormel Foods Corporation (NYSE:HRL) Q4 2018 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Good morning, ladies and gentlemen, and thank you for standing by. Welcome to the Hormel Foods Fourth Quarter 2018 Earnings Release Conference Call. At this time, all participants are in a listen-only mode. As a reminder, this conference is being recorded on Tuesday, November 20, 2018.

I would now like to turn the conference over to Nathan Annis, Director of IR. Please go ahead, Mr. Annis.

Executive
Nathan Annis

Good morning. Welcome to the Hormel Foods conference call for the fourth quarter of fiscal 2018. We released our results this morning before the market opened around 6:30 a.m. Eastern. If you did not receive a copy of the release, you can find it on our website at hormelfoods.com under the Investors section.

On our call today is Jim Snee, Chairman of the Board, President and CEO; and Jim Sheehan, SVP and CFO. Jim Snee will provide a review of each segment's performance for the quarter and our outlook for 2019. Jim Sheehan will provide detailed financial results and further assumptions relating to our outlook.

The line will be open for questions following Jim Sheehan's remarks. As a courtesy to the other analysts, please limit yourself to one question with one follow-up. If you have additional questions, you are welcome to get back into the queue. An audio replay of this call will be available beginning at 11 a.m. today, Central Standard Time. The dial-in number is 888-254-3590, and the access code is 9962477. It will also be posted to our website and archived for one year.

(Forward-Looking Cautionary Statements)

Additionally, please note the company uses non-GAAP results to provide investors with a better understanding of the company's fourth quarter and full year operating performance. These non-GAAP financial measures should not be considered a replacement for and should be read together with our GAAP results. Discussion on non-GAAP information in addition to reconciliations to GAAP results are detailed in our press release located on our website. We will refer to these non-GAAP results as organic net sales, organic volume, adjusted segment profit, and adjusted earnings per share.

I will now turn the call over to Jim Snee.

Executive
Jim Snee

Thank you Nathan. Good morning, everyone. Throughout the year, we made significant progress towards our long-term vision as a global branded food company. With an emphasis on brand building, innovation, acquisitions, and intentional balance, our long-term approach allowed us to manage through difficult situations such as commodity market volatility, increased freight, and global trade uncertainty.

This year was marked by many milestones. We made the largest acquisition in our company's history with the purchase of Columbus Craft Meats, and we also successfully integrated both Columbus and Fontanini into our supply chain. We reinvested a record amount of capital back into our company to increase capacity and improve efficiency. Major capital projects in 2018 included the Dold Foods' pre-cooked bacon expansion and a highly automated whole bird facility.

We also delivered many innovative new items to the marketplace. Items such as Herdez guacamole salsa, Natural Choice snacks, Applegate naturals