Sales rose 5 percent to $1.1 billion, boosted by a price increase and growth in some key brands, while Hershey reaffirmed its 2008 guidance of sales growth of 3 to 4 percent and earnings of $1.85 to $1.90 per share.
The upbeat report from Hershey comes as it works to pull out of two years of lackluster sales amid toughening competition, volatile dairy and cocoa prices, and a costly effort to shift production overseas to where populations are younger and growing faster.
Company president and Chief Executive David J. West said a new marketing plan, marked by a 30 percent increase in spending, is driving an improved performance in the relatively slow-growing, but dominant U.S. candy market.
"We're pleased with our U.S. marketplace performance in the second quarter as we improved in all classes of trade," West said in a statement. "The category has and will continue to grow."
Discounting pretax charges of $39.3 million, or 11 cents a share, the Hershey, Pa.-based maker of Hershey's Kisses and Reese's said it would have earned nearly $67 million, or 29 cents a share.
Based on those numbers, analysts surveyed by Thomson Financial expected 28 cents per share. Still, after discounting pretax charges, Hershey earned more in last year's second quarter, $81.7 million or 35 cents a share.
In January, Hershey boosted wholesale prices by 13 percent on about one-third of its domestic candy line, including many of its biggest-selling products.
Hershey is also in the process of closing six U.S. and Canadian plants and cutting more than 3,000 jobs, while it looks to a new plant in Mexico and joint ventures in India, China and Brazil to capitalize on booming growth in those countries.
For the first six months of 2008, Hershey gained $104.7 million, or 46 cents a share, not including pretax charges, compared with $97 million, or 42 cents a share, in the first half of 2007. Sales rose 2.8 percent in the six-month period to $2.27 billion.
