HUNT VALLEY, MD. — Price increases taken during 2022 and earlier this year have buoyed McCormick & Co.’s financial performance. Looking ahead to the rest of the year, management sees some volume recovery occurring as inflation eases and innovation reaches the market.

For the second quarter ended May 31, McCormick earned $152.1 million, equal to 57¢ per share on the common stock, and an improvement over the same period of the previous year when the company earned $118.5 million, equal to 44¢ per share.

Quarterly sales rose to $1.66 billion, up from $1.54 billion the year before.

On a constant currency basis, sales rose 10% during the quarter with an 11% increase from pricing and partially offset by a 1% volume and mix decline. Included in the volume decline was a net 1% increase from lapping prior-year COVID-related disruption in China, the divestiture of Kitchen Basics, and the exit of its consumer business in Russia.

“… We expect our volume performance to improve as we go through the year and to be stronger in the second half versus the first half,” said Lawrence E. Kurzius, chairman and chief executive officer, during a June 29 conference call to discuss second-quarter results. “And that outlook has not changed. Given that we have slightly softer volumes in China in our outlook, we're — we have a little bit less contribution from that part of the business. But in the second half, overall, as a company, we’re expecting volumes to be very close to flat.”

In the company’s Consumer Segment business unit sales rose 5% to $912 million from $866 million the year before.

“Our total US branded portfolio consumption, as indicated by our IRI consumption data and combined with unmeasured channels, grew 7%,” said Brendan M. Foley, current president and chief operating officer, who will be taking over as CEO in September. “The difference between our sales and consumption was attributable to the retail sell-through of discontinued items and listing fees for an increase in the new distribution and products, for example, our new Cholula and Stubb's items and Tabitha Brown line extensions.”

Flavor Solutions Segment sales rose 12% to $747 million, up from $671 million the year before.

“We are priced to cover current year inflation and are continuing to recover the cost inflation or pricing lagged the last two years,” Mr. Foley said. “Recovery in the second quarter was even greater than the first.”

In the Americas, Flavor Solutions seasonings growth was strong, including volume growth from new products that outpaced last year’s new product contribution, said Mr. Foley.

“We are winning in seasonings with our heat platform,” he said.

Management reaffirmed the company’s sales outlook and raised its operating income and adjusted earnings per share outlook. In 2023, McCormick expects to grow sales by 5% to 7% compared to 2022 when sales were $6.35 billion.

Operating income in 2023 is expected to grow by 11% to 13% from $864 million in 2022, and the company projects 2023 adjusted earnings per share to be in the range of $2.60 to $2.65, as compared to previously reported guidance of $2.56 to $2.61 and adjusted earnings per share of $2.53 in fiscal 2022.