HRL Reports Decline in Net Sales for Q4 Fiscal 2022
Segments of revenue
In the fourth quarter of fiscal 2022, HRL reported a decline in net sales across its segments. The Foodservice segment experienced a 3.3% decrease in net sales, amounting to $1.01 billion. The Retail segment also saw a decline of 5.3% in net sales, totaling $2.07 billion. Additionally, the International segment reported a decrease of 9.9% in net sales, amounting to $207.4 million. Overall, HRL's total net sales for the quarter amounted to $3.28 billion, representing a 5.0% decline.
Despite the decline in net sales, HRL showcased strengths in certain product lines. Products such as Hormel Natural Choice meats, Hormel Bacon 1 fully cooked bacon, and Hormel Fire Braised flame-seared meats experienced growth in volume and sales during the fourth quarter of fiscal 2022. These positive results contributed to the overall performance of the company. Additionally, HRL's fiscal 2022 volume and net sales increased due to strong results across its portfolio, as the industry continued to recover from pandemic-related declines. The inclusion of the Planters snack nuts business in the convenience channel also contributed to the growth in net sales.
HRL faced challenges in the form of lower turkey sales and the impact from an additional week in the fourth quarter of fiscal 2021, which resulted in volume and net sales declines for the fourth quarter of fiscal 2022. The Retail and International segments experienced significantly lower results, leading to a decline in segment profit. The company also faced an adverse arbitration ruling, which had a pre-tax impact of $68.3 million and contributed to a decline in net earnings.
HRL's segment profit for the Foodservice segment increased due to improved mix across the portfolio. However, the Retail segment saw a significant decline in segment profit, primarily driven by lower volumes, unfavorable mix, and higher selling, general, and administrative expenses. The company reported adjusted net earnings, excluding the impact of the adverse arbitration ruling, non-cash impairment charges, and costs associated with the company's transformation and modernization initiative, which declined by 12%.
HRL reported a decline in net sales for the fourth quarter of fiscal 2022, primarily attributed to lower turkey sales and the impact of an additional week in the previous year's quarter. However, the company showcased strengths in certain product lines, such as Hormel Natural Choice meats and Hormel Bacon 1 fully cooked bacon, which contributed to overall growth in volume and sales. HRL's fiscal 2022 volume and net sales increased due to strong results across its portfolio and the inclusion of the Planters snack nuts business. The company faced challenges in the form of lower segment profit, an adverse arbitration ruling, and higher expenses. Overall, HRL's financial performance in the latest quarter reflects a mixed performance with both strengths and challenges.