Canada Can 'Kiss' Hershey Plants Goodbye

Hershey's earnings outlook lowered amid restructuring efforts.

HARRISBURG, Pa. (AP)- Hershey, the nation's largest candy maker, said Thursday it will earn less in 2007 than it had originally forecast, a day after disclosing plans to close its last two plants in Canada and cut jobs from another plant in Pennsylvania.
The company’s  shares dropped more than 3 percent in pre-market trading.
The Hershey Co. said a sluggish domestic business and higher dairy costs forced it to lower its earnings growth estimate for this year to 4 percent to 6 percent, down from the 7 percent to 9 percent range it forecast last month. It maintained its forecast of sales growth in the 3 percent to 4 percent range.
On Wednesday, the company said it will close plants in Dartmouth, Nova Scotia, and Montreal by the end of the year, laying off 730 workers. Another 80 to 100 workers will be laid off from a plant in Lancaster, not far from its headquarters in Hershey, the company said.
The planned closure of the Canadian plants brings the number of plants Hershey has said it plans to shut down in 2007 and 2008 to six as part of a broader restructuring to cut costs and improve efficiency.
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