Hormel Foods Corporation (NYSE: HRL) today announced dollar sales of $886,015,000 for the third quarter ended July 29, an 8.5 percent increase from the $816,818,000 reported for the same 13-week period of fiscal 1999. Earnings per share of $.21 represented an increase over last year’s third quarter per share earnings of $.20. Net earnings for the current quarter were $29,136,000 compared to year-earlier third quarter earnings of $29,550,000.

Operating earnings for the first nine months of the year (39 weeks) were $109,238,000, an increase of 9.3 percent, or $9,282,000, over operating earnings of $99,956,000 for the comparable period of fiscal 1999. Operating earnings per share were $.77 as compared to $.68 for the same three quarters of last year. For the first nine months of fiscal year 1999, total reported earnings of $103,764,000, or $.70 per share, were slightly higher than reported operating earnings because of a one-time gain of $3,808,000, or $.03 per share, for the sale of land by Campofrio Alimentacion, S.A., Madrid, Spain, a company in which Hormel Foods has a 21.4 percent ownership interest.

All per share amounts have been adjusted to reflect the two-for-one split of Hormel Foods common stock approved by shareholders last January.

Dollar sales of $2,668,951,000 for the nine months were up 10.9 percent from the $2,406,918,000 reported for the corresponding 39 weeks of last year.

Joel W. Johnson, chairman of the board, president and chief executive officer, explained that higher prices for hogs in the spot cash market placed pressure on the company’s ability to obtain historical margins in its pork operations. “While our procurement contracts with pork producers generated positive returns, live hog prices increased 45 percent from one year ago. We were simply not able to increase prices on our products quickly enough to compensate for these higher costs.” Another factor, added Johnson, was relatively low retail beef prices. “A continuation of low beef versus high pork prices compared to one year ago, plus large quantities of poultry moved into the marketplace, encouraged retailers to put more emphasis on beef and chicken features.”

In a further review of the third quarter, Johnson reflected on the many marketing achievements and the promising new consumer-branded, value-added products introduced by the company’s core business groups. Within the Prepared Foods Group, the launch of the Carapelli olive oil line continues to move forward with sales and distribution ahead of plan. A three-liter tin of Carapelli olive oil was introduced in the New York and New England markets. SPAM oven roasted turkey was rolled out nationally and was joined in 10 markets with a new Hot & Spicy SPAM luncheon meat featuring Tabasco brand pepper sauce. Although category performance of many of the canned foods businesses in which the company competes was soft or flat, Hormel Foods succeeded in developing market share gains for many of its best-known products — Hormel chili, SPAM luncheon meat, Dinty Moore stew, Mary Kitchen hash, Hormel chunk meats and Hormel bacon bits.

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The Refrigerated Foods Group completed the national introduction of its Always Tender line of teriyaki and peppercorn filet of beef sirloin products. The forerunners to this line, Always Tender fresh pork, Always Tender flavored pork and Always Tender Consumer Ready fresh pork, recorded good growth. Sales, tonnage volume and dollar share growth of Hormel bacon, Hormel pepperoni and the Hormel fully cooked entree line continued strong upward trends.

Volume, margins and profit performance of the company’s foodservice business remain strong with premium pork, cooked beef, deli cooked hams, premium buffet hams and Bread Ready presliced meats all recording excellent increases. The Austin Blues BBQ family of fully cooked and smoked beef brisket, hand-pulled pork, St. Louis-style ribs and pork loin products, introduced earlier this year, is generating excitement for foodservice operators interested in offering a unique menu item that features their own signature sauce.

Value-added segments of Jennie-O Foods also recorded gains. Foodservice again registered sales growth during the quarter. For most of Jennie-O Foods retail brands, increases in volume sales, dollar share and distribution were achieved. New products soon to be introduced include Jennie-O corn dogs, Jennie-O savory seasoned turkey burgers, Jennie-O variety pack luncheon meats and Jennie-O slice n’ serve turkey breast.

For Hormel Foods International (HFI), export volume increased dramatically with major gains across most consumer brands, including Hormel bacon bits, Mary Kitchen hash, Dinty Moore stew, Kid’s Kitchen microwave meals, Stagg chili, Hormel precooked bacon, Hormel dry sausage toppings and Hormel fresh and frozen pork. Dollar share of SPAM chopped pork and ham in the United Kingdom set a new 52-week record. New distribution for Stagg chili was attained in Canada, building upon the already strong popularity of this extensive line of premium chili favorites. In China, the company’s joint venture operations are producing six items for sale in Hong Kong. Sales volume in the Philippines continues to grow through The Purefoods-Hormel Company with hot dogs a major contributor to foodservice and retail sales.

Hormel Foods news releases and other investor and company information is available on the Internet at http://www.hormel.com.This press release contains forward-looking statements based on management’s current views and assumptions. Actual events may differ. Please refer to the Cautionary Statement Relevant to Forward-Looking Statements and Information which appears on Exhibit 99 of the company’s Annual Report on Form 10-K for the fiscal year ended October 30, 1999, which can be accessed at http://www.hormel.com