Hormel Foods has said the outbreak of HN52 avian influenza at a number of turkey farms will put pressure on sales and earnings from its Jennie-O Turkey Store division in the US giant's current financial year.
The company said sales volumes will be "reduced" in the wake of the detection of the disease at "multiple" farms supplying the business.
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""We are experiencing significant challenges in our turkey supply chain due to the recent HPAI outbreaks in Minnesota and Wisconsin. While Jennie-O Turkey Store has delivered strong financial performance so far in the first half, tight meat supplies and operational challenges will pressure earnings in the back half of our fiscal year," Hormel chairman, president and CEO Jeffrey Ettinger said.
Hormel is sticking to its forecast for its adjusted earnings guidance to hit $2.50- 2.60 a share, although it expects the situation to push EPS "toward the lower end of this range".
Ettinger added: "We expect the financial impact … to be partially offset by favourable hog prices benefitting the refrigerated foods segment and portions of the grocery products segment."
Hormel will report the financial results for its second quarter on 20 May.
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