Consumer spending drops in April
WASHINGTON—U.S. consumer spending dropped 0.2% in April 2013, according to the Commerce Department.
It was the first monthly decline since May of last year and follows increases of 0.1% in March and 0.8% in February. Falling gas prices in April were part of the reason for the drop in spending, with purchases of gas, electricity and other energy goods and services down 4.4%.
In addition, increased Social Security deductions in consumer paychecks may have also contributed to the decline in spending.
Cargill CEO appointed to Deere board
MOLINE, Ill. — Deere & Company has elected Cargill CEO Gregory R. Page to its board of directors. Cargill is an international producer and marketer of food, agricultural, financial and industrial products and services.
Based in Minneapolis, Minnesota, the privately held company employs about 140,000 people in 65 countries and has annual sales of more than $130 billion.
"As the leader of a global enterprise with a long record of success in the agricultural and food sectors, Greg brings a breadth of valuable experience to Deere as it addresses the world’s growing need for food, fuel and feed," said Samuel R. Allen, Deere’s chairman and CEO. "His insight and deep knowledge of the agricultural value chain are sure to make important contributions to our company. We are pleased he has agreed to join the Deere board."
Page was named Cargill’s CEO in June 2007 and chairman of the board of directors later that year. Earlier he served in a number of leadership roles at the company including president and COO and corporate EVP. His background, which spans nearly 40 years with the Cargill organization, includes assignments in Singapore and Thailand.
Under Page’s leadership, Cargill has seen significant growth and increasingly focused its operations on innovation and higher-value products. As well, Page has been a forceful advocate of his company’s longstanding commitment to ethical business practices and responsible corporate citizenship.
Page grew up in Bottineau, N.D., and earned a degree in economics from the University of North Dakota. He is a member of the boards of directors of Eaton Corporation and Carlson Companies. Page also is a national board member and former board chairman of Big Brothers Big Sisters of America.
With Page’s election, Deere & Company’s board totals 12 members, 11 of whom are not employees of the company.
McCormick expands brand portfolio
SPARKS, Md. — McCormick & Company, a global manufacturer, marketer and distributor of spices, seasoning mixes and condiments, has acquired Wuhan Asia-Pacific Condiments Co. WAPC manufactures and markets the DaQiao and ChuShiLe brand of bouillon products, which have a leading position in the central region of China.
These products complement McCormick’s current portfolio of flavor products in China that include spices, seasoning blends and sauces. With its strong presence in central China, WAPC also complements McCormick’s presence in the coastal regions.
Annual sales of WAPC’s business are approximately $122 million U.S. In the past five years, sales of WAPC have increased at a compound annual growth rate of approximately 25%, and McCormick anticipates continued annual sales growth of at least 10%. The purchase price for this business was $147 million U.S., subject to normal purchase price adjustments. McCormick funded this acquisition with cash and debt.
McCormick expects the acquisition to increase earnings per share in 2014 and be fully accretive in 2015, once integration activity is completed. In 2013, the company expects to record $4 million of fees and other costs related to the completion of the transaction, as well as integration and financing costs. These costs are expected to more than offset operating income from the WAPC business and have a slightly dilutive impact on 2013 earnings per share. The company expects operating income margin from the business to be approximately 10%, when transaction, integration and financing costs are excluded.
McCormick’s growth strategy includes expansion in emerging markets where consumers have an increasing interest in flavors and branded food products. The company first entered China more than 20 years ago to supply products to industrial customers. This was followed by the successful launch of consumer products. Across both the consumer and industrial business, the company operates profitably in China and has grown sales more than 50% in the past five years.
McCormick & Company products are available at retail outlets, food manufacturers and foodservice businesses.