Financial Statement Analysis of Hershey's Limited 2009-2015 Essay

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Pages: 16


The Hershey's Company, later referred to as HSY, is the largest producer of quality chocolate in North America and a global leader in chocolate and sugar confectionery founded by Milton Hershey in 1894. Hershey's is a public trading company and have filed their annual returns as a public trading company in the United States Securities under Form 10-K.

In this paper, we will use the financial data in the Audited Financial Statement to compute the key financial ratios as an indicator for the Hershey's company in the global financial scale. Through calculations of the profitability, liquidity, stability and shareholder's interest; the five year trends from 2009 to 2013 will be analysed in both an internal and external
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They face increased market place competition from much larger companies that have greater resources and more substantial international operations. They are also challenged by increases in energy costs, commodity market fluctuations, fluctuations in the exchange rate and availability of adequate suppliers of raw and packaging materials.

Highlighted below is HSY's position in emerging markets in relation to other companies in the industry.

Figure 3: Positions in Emerging Markets (Euromonitor)


The Capital Structure of HSY is based into two classes, Common stock and Class B Stock. The major differential in the two types of stock are the voting rights and dividend policy. Common stock holders have one vote per share whereas Class B stockholders have ten votes per share. Dividend or common stock holders are entitled to 10% higher than those declared and paid on Class B stock. In addition to the two main group of shareholder of common stock and class B Stock, the voting controlling stock is held by Hershey's Trust Company as the trustee for the benefit of Milton Hershey.

As a result of 2007 investigations by the Competition Bureau of Canada into alleged violations of the Canadian Competition Act, lawsuits were filed in Canada and subsequently in the US against Hershey's. In June 2013, Hershey's pleaded guilty to one count of price fixing and was fined $4.0M. These legal fees contributed to 8.8%