By Micah Maidenberg
McCormick & Co. said stronger sales of products like Zatarain's frozen foods in its consumer business covering the U.S. offset weaker demand for spices in the latest quarter, a business hurt by this year's late Easter.
Easter landed on April 21 this year, almost three weeks later than in 2018. Food makers watch holidays closely, as they can inspire consumers to pile into stores and scoop up seasonally themed products. In April, Hershey Co. said it benefited from higher demand for candy in the longer run up to Easter.
But for McCormick, the relatively late date meant a delayed start to when consumers pulled out their grills and purchased spices and other grill-related products.
"It compressed the front end of the grilling season," Chief Executive Lawrence Kurzius said Thursday in an interview, adding that the late Easter pushed back when retailers switched merchandising displays to those focused on grilling.
Sales of the company's consumer products in the Americas, however, rose 2% excluding currency fluctuations. Frank's RedHot hot sauces helped to drive growth in the region.
Overall, sales of $1.3 billion were flat compared with last year, but roughly in line with expectations of analysts polled by FactSet. Excluding currency fluctuations, sales were up 3%.
Shares of the Hunt Valley, Md.-based company rose about 3.5% on Thursday to close at $155.87.
The company notched gains in overseas markets, including in India and Australia, where it has been expanding distribution of staples in the U.S., French's mustard and Frank's sauces.
McCormick's business selling products used in restaurants in China slowed down, amid a broader economic slowdown in the country. Gross-domestic product in China grew at a 6.4% rate in the first quarter, the second straight period that was weaker than last year's full-year gain of 6.6%.
"Anecdotally, we're certainly getting a lot of feedback from our organization in China that it's foodservice and restaurant sales that are slow," Mr. Kurzius told analysts on a call.
McCormick's profit rose 21% from a year earlier to $149.4 million, or $1.12 a share. Earnings on an adjusted basis also came in ahead of analysts' expectations.
The company on Thursday also raised its outlook for adjusted profit. McCormick now expects those earnings to be between $5.20 a share and $5.30 a share, an increase of 3 cents a share from its past forecast.
--Allison Prang contributed to this article.
Write to Micah.Maidenberg at Micah.Maidenberg@WSJ.com
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