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How big is your International business outside of North America?
Less than 5% of the Corporation's total sales.
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How much HSY stock does the Milton Hershey School Trust own?
The Milton Hershey School Trust owns about 33% of The Hershey Company's total equity and has 78% of voting control as of December 31, 2003.
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What percent of your cost of goods sold is represented by cocoa costs?
For competitive reasons, we don't disclose these costs, however, the most significant raw material used in the production of the Corporation's chocolate products is cocoa. In order of magnitude, our principal raw materials are: cocoa, sugar, milk, peanuts, almonds, and coconut.
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What percent of your sales is represented by marketing costs?
About 15-17% of sales
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When were the Corporation's stock splits?
9/16/47 3 for 1
3/27/62 5 for 1
9/15/83 2 for 1
9/15/86 3 for 1
9/13/96 2 for 1
6/15/04 2 for 1
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When are your dividends paid?
Dividends on The Hershey Company's Common Stock and Class B Common Stock are declared by the Board of Directors and normally are paid in the months of March, June, September and December. The payout ratio is approximately 45 percent from income of continuing operations.
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When was The Hershey Company founded?
The Hershey Company (originally Hershey Chocolate Corporation) was organized under the laws of the State of Delaware on October 24, 1927, as a successor to a business founded in 1894 by Milton S. Hershey.
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When was HSY first publicly traded?
December 1, 1927, was the initial listing date on the New York Stock Exchange. The initial listing price was $39 5/8.
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Who is your Transfer Agent?
Mellon Investor Services (click here for link to Hershey's Stock Purchase/ Dividend Reinvestment page).
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When does your fiscal year end?
December 31.
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Who is The Hershey Company's largest customer?
Sales to McLane Company, Inc., formerly a subsidiary of Wal-Mart Stores, Inc., exceeded 10% of total net sales and approximated $930.1 million in 2003.
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Who is The Hershey Company's largest competitor?
In the domestic chocolate category, our largest competitor is Mars, followed by Nestle, Russell Stover, and Palmer. In the domestic non-chocolate category, our largest competitor is Kraft/Nabisco.
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What percent of the confectionery industry is private label? How fast is this growing?
Private label represents about 2% of confectionery category sales. This percentage has remained fairly consistent over time, as consumers continue to recognize the superior value, quality, and taste of Hershey's and other branded confectionery products, and continue to vote for branded confectionery products with their purchases.
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What percent of your business is chocolate vs. non-chocolate? How does this compare with the overall industry?
On a dollar basis, The Hershey Company's sales are roughly 75% chocolate and 25% non-chocolate. The industry mix is roughly 65% chocolate and 35% non-chocolate. On a tonnage basis, the industry is approximately 50%-50%.
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To which classes of trade does The Hershey Company sell?
The Hershey Company sells to 8-10 different classes of trade (depending on how one wishes to segment them) including: grocery wholesalers, chain grocery stores, candy distributors, mass merchandisers, chain drug stores, vending companies, wholesale clubs, convenience stores, concessionaires and food distributors. Products are sold by full-time sales representatives, food brokers and part-time retail sales merchandisers throughout the United States, Canada and Mexico. The Corporation believes its products are sold in over 2 million retail outlets in North America.
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Does The Hershey Company use its traditional flavor profile for its chocolate products when selling them outside of the US?
Many countries outside of North America prefer different flavor profiles than those contained in a classic American HERSHEY'S milk chocolate bar. Hershey often sells its chocolate products outside of North America containing flavor profiles similar to those found in HERSHEY'S Symphony bars, and HERSHEY'S Extra Creamy Nuggets which are sold in the US.
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How is The Hershey Company's management's performance evaluated?
For executive officers at the corporate level, the performance objectives are based on financial measures including earnings per share-diluted, consolidated net sales and consolidated economic return on invested capital. For executive officers at the business unit level, the performance objectives include unit operating income, unit net sales and consolidated economic return on invested capital.
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Does Hershey's business fluctuate throughout the year, or does it remain relatively steady?
Our business fluctuates by season. Chocolate and non-chocolate confectionery and grocery seasonal and holiday-related sales have typically been highest during the third and fourth quarters of the year.
Our largest seasons include: Back to School /Halloween, Christmas, and Easter.
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Does Hershey own Cadbury?
Hershey does not own Cadbury Schweppes. However, Hershey has license agreements with affiliated companies of Cadbury Schweppes p.l.c. to manufacture and/or market and distribute YORK, PETER PAUL ALMOND JOY and PETER PAUL MOUNDS confectionery products worldwide, as well as CADBURY and CARAMELLO confectionery products in the United States. The Corporation's rights under these agreements are extendible on a long-term basis at the Corporation's option. The license for CADBURY and CARAMELLO products is subject to a minimum sales requirement which the Corporation exceeded in 2003.
The Corporation also has an agreement with Societe des Produits Nestle SA, which licenses the Corporation to manufacture and distribute KIT KAT and ROLO confectionery products in the United States. The Corporation's rights under this agreement are extendible on a long-term basis at the Corporation's option, subject to certain conditions, including minimum unit volume sales. In 2003, the minimum volume requirements were exceeded.
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What has driven the superior confectionery category growth rate?
Superior
Consumer value. The confectionery industry is comprised of
companies with long histories of providing the consumer with products of
consistently high quality and value. Consumers trust and appreciate this
track record, and as a result, very strong candy brand loyalties have
evolved in the consumer's mind. Not only is this the foundation of
growth, but we believe that U.S. confectionery manufactures have over the
years maintained a very good price-value relationship which has been a
major reason behind the fact that private label is only about 2% of our
market.
Strong marketing programs.
Increased advertising and highly focused trade promotions motivate the
retailer to aggressively sell our products rather than stock the back room
with inventory on deal. Highly visible and thematic selling events with
appropriate displays have really helped drive the business for both
manufacturers and retailers alike.
Category Management.
Partnering with our customers, the retailer, we provide data and programs
to maximize turnover and profitability for the customers' entire
confectionery section. Being category captains for most of the major
accounts in the U.S. places us in a preferred position with our retail
customers.
New Products. New products
have been instrumental in driving our growth. New products create a lot of
excitement for the category, and in our view, as a plus for Hershey.
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Does The Hershey Company provide any discounts or "freebies" to its stockholders?
In the past, stockholders have been given a 25% discount coupon for purchases at HERSHEY'S CHOCOLATE WORLD VISITORS CENTER on the day of the Annual Stockholders' Meeting. This practice, however, is subject to change.
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How is Hersheypark doing?
All recreation and tourism facilities in Hershey are owned by HERCO (Hershey Entertainment and Resort Company), a separate and distinct corporation wholly owned by the Milton Hershey School Trust. HERSHEY'S CHOCOLATE WORLD Attraction, however, is owned by The Hershey Company.
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