Dive Brief:

• Skippy peanut butter and SPAM maker Hormel Foods finance chief Jacinth Smiley has stepped down from her position to pursue other opportunities, the company said in a Wednesday press release and securities filing. 
• Hormel tapped Paul Kuehneman, its vice president and controller, to serve as interim CFO in a move that was effective Oct. 27, according to the release.
• Smiley, who has served as Hormel’s CFO since Nov. 2021, is expected to remain as an employee with Hormel until Nov. 30, according to the filing with the Securities and Exchange Commission. Hormel plans to enter into a separation agreement with Smiley, and to consider both external and internal candidates as it conducts a search for her permanent successor, it said.

Dive Insight:

The CFO switch is occurring several months after the Austin, Minnesota-based branded food company announced a shift in its top executive seat — bringing back its former CEO, Jeff Ettinger, to serve as interim CEO for a defined 15-month period beginning July 14, according to a press release.

In his role as interim CFO, Kuehneman will report directly to Ettinger, according to the press release. Joining Hormel in 2009 as its director of internal audit, Kuehneman, 54, previously served a five-year stint as CFO for Hormel subsidiary Jennie-O Turkey, and stepped into his most recent role as VP and controller in February 2022, according to his LinkedIn profile. The company will provide compensation details for Kuehneman’s appointment as interim CFO once they are finalized, according to the filing.

“Paul is a respected leader with deep knowledge of our business and a proven track record of results,” Ettinger said in a statement included in the release. “His broad experience across the organization over three decades makes him well-equipped to support our Company's strategy, maintain financial discipline, and drive long-term shareholder value.”

Kuehneman is taking the interim role as Hormel looks to navigate several headwinds, including inflationary pressures.

Hormel on Wednesday also provided guidance on some challenges and topics set to impact its upcoming fourth quarter, warning it has “continued to experience persistent inflation in key commodity inputs, at levels exceeding expectations.”  

The company previously highlighted ongoing inflationary pressures in its Q3 earnings report, with Ettinger noting in a statement that Hormel is taking “targeted pricing actions” to address commodities inflation. Profit recovery is also expected to lag into the new year, “with the near-term pressures we experienced in the third quarter persisting through the fourth quarter,” he said.

Food prices rose by 0.2% in September, after rising by 0.5% the previous month, according to data released by the Bureau of Labor Statistics. The index for meats, poultry, fish and eggs, meanwhile rose by 5.2% over the past 12 months, the BLS said.

As well as inflationary pressures, Hormel has also been impacted by the spread of avian influenza and pneumoviruses in the poultry space, it said Wednesday.

“Hormel Foods remains focused on mitigating these headwinds through productivity initiatives and strategic pricing actions,” it said in the press release.

On Oct. 25, the company also issued a voluntary recall of almost 5 million pounds of frozen ready to eat chicken products after noting they might contain “extraneous metal material.”

Hormel discovered the issue after receiving multiple complaints from foodservice customers “finding metal in their frozen chicken breast and chicken thigh products,” according to a U.S. Department of Agriculture’s Food Safety and Inspection Service press release, which advises the products should be thrown away. “Hormel Foods determined that the metal originated from the conveyor belt used in production.”

For its upcoming fourth quarter, Hormel is expecting net sales at the top end of its previously issued range of between $3.15 billion to $3.25 billion, it said Wednesday. It also expects to see adjusted earnings per share of about $0.08 to $0.09 below its prior expectations, it said.