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McCormick & Company, Inc. at Wachovia First Union Consumer Growth Conference - Final.

Article Excerpt
UNIDENTIFIED PARTICIPANT: Good morning again, and thanks again for attending our Wachovia Consumer Growth Conference. Here with us we are honored to have the CEO of McCormick & Company, Alan Wilson, and Chief Financial Officer, Gordon Stetz, to talk to us about a business that in my view is perfectly positioned for a lot of the consumer trends that are happening today. Solutions that are innovative, high margin, and offer consumers the opportunity to eat at home more tastefully. With that, Alan.

ALAN WILSON, CEO, MCCORMICK & COMPANY: Also with us today we have Joyce Brooks, who is our Vice President Investor Relations.

As we begin our remarks, I would like to remind you that we will be making certain forward-looking statements, and in that regard I would like to refer you to the information on this page.

I am certain that investors and analysts who have joined us here by webcast and here today are under pressure during this market, so we appreciate your time with us today.

Later in our remarks, Gordon will be discussing the implications to our business of a tougher economic and economy during 2008. But I do want to acknowledge right up front that the market events of the last two weeks have led us to a disappointing decline in our stock price. Despite the market's effect on the stock price, we remain positive on our business. We have a solid balance sheet, good access to cash, and we are closely monitoring any exposure to risk.

As October is always our largest sales month of the year, I can assure you that our customers are stocking up for the holiday season. And employees throughout McCormick remain steadfast in their focus on growth initiatives and cost savings.

I'm going to direct most of my remarks to those growth initiatives, but would like to begin with some general remarks, particularly for those joining us here in the room or by webcast who may be unfamiliar with our business.

Founded in 1889, McCormick is the leading global supplier of value-added flavor solutions. From facilities around the world our brands can be found in nearly 100 countries. And in 2007 40% of our sales were international.

We operate in two segments of the industry, consumer and industrial. In the consumer segment we sell leading brands, as well as private-label store brands, to traditional grocers, as well as alternative retail channels.

Through our industrial business we develop and supply products to multinational restaurants and many of the leading food manufacturers, some of whom have been presenting at this conference.

Whether you are adding flavor to the grill, picking up a quick meal or enjoying a snack, each day you're likely to enjoy something flavored by McCormick. This is a great position within the food industry, and there are few boundaries as we think about ways to grow our businesses.

Our strategy for growth is straightforward, to improve margins, invest in the business, and increase sales and profits. This strategy has been the foundation of our success for the past 10 years. In 2008 investing in the business has been an area of real accomplishment with the acquisition of Lawry's, increased marketing support, and new product innovation. And we will talk about these in a minute.

At McCormick we have a track record of strong, long-term financial performance. Sales growth has averaged 7% for the past five years, with an average increase in EPS of 10%. Dividend increases have averaged 11% during the last 10 years. We have a solid balance sheet. And our total shareholder return has been one of the best in the industry.

Early in the year I have set out four priorities for 2008, Performance, that means meeting our...