© Reuters. FILE PHOTO: An employee shows a Hershey’s chocolate bar made in USA in the “American lifestyle” store in Berlin, Germany, August 13, 2018. REUTERS/Fabrizio Bensch
(Reuters) -Hershey Co raised its full-year net sales and profit forecasts on Friday, signaling strong Halloween candy demand that it expects to continue into the holiday season despite higher selling prices.
Halloween is Hershey’s busiest time of the year, making up about 10% of its annual revenue, with sales benefiting for months in advance of the October holiday as retailers place early orders to stock up on Twizzlers, Jolly Ranchers and Kit Kat bars.
After two years of pandemic restrictions on trick-or-treating, candy demand during Halloween is expected to have risen sharply this year, with the National Retail Federation (NRF) expecting sales to have hit a record high of $3.1 billion.
Hershey joins global packaged food makers, including Cadbury Chocolate maker Mondelez (NASDAQ:MDLZ) International, Kellogg (NYSE:K) Co and Kraft Heinz (NASDAQ:KHC) Co, in using its brand power and distribution scale to pass on price increases to consumers while seeing little pushback in demand.
Hershey said its overall average selling prices increased by 7.7% in the third quarter while volumes rose 4.1%.
The Reese’s Peanut Butter Cup maker’s revenue rose 15.6% to $2.73 billion in the quarter ended Oct. 2. Analysts on average had expected a revenue of $2.62 billion, based on IBES data from Refinitiv.
Excluding extraordinary items, it earned $2.17 per share, beating analysts’ estimate of $2.10 per share.
The company said it now expects full-year 2022 net sales to grow between 14% and 15%, compared to the previous forecast of 12% to 14% growth.
It forecast a 14% to 15% rise in its 2022 adjusted profit per share, above the prior forecast of a 12% to 14% increase.