Name: Hershey Co. (NYSE:HSY) | Statement of Comprehensive Income
Creator: Stock Analysis on Net

Statement of Comprehensive Income

Comprehensive income is the change in equity (net assets) of a business enterprise during a period from transactions and other events and circumstances from non-owners sources. It includes all changes in equity during a period except those resulting from investments by owners and distributions to owners.

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Hershey Co., consolidated statement of comprehensive income

US$ in thousands

12 months ended:	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
Net income including noncontrolling interest	1,644,817)	1,482,819)	1,275,413)	1,146,752)	1,171,051)
Foreign currency translation gains (losses) during period	(10,340)	(1,500)	(13,767)	13,141)	(31,143)
Reclassification to earnings due to the sale of businesses	—)	5,249)	—)	—)	25,131)
Foreign currency translation adjustments	(10,340)	3,749)	(13,767)	13,141)	(6,012)
Net actuarial gain (loss)	(25,489)	53,799)	(30,104)	(7,042)	(29,604)
Reclassification of tax effects relating to U.S. tax reform	—)	—)	—)	—)	(36,535)
Reclassification to earnings	23,617)	24,025)	25,086)	23,085)	30,435)
Pension and post-retirement benefit plans	(1,872)	77,824)	(5,018)	16,043)	(35,704)
Gains (losses) on cash flow hedging derivatives	1,982)	(4,540)	1,100)	(1,658)	5,736)
Reclassification of tax effects relating to U.S. tax reform	—)	—)	—)	—)	(11,121)
Reclassification to earnings	7,112)	17,083)	4,623)	5,455)	2,896)
Cash flow hedges	9,094)	12,543)	5,723)	3,797)	(2,489)
Other comprehensive income (loss), net of tax	(3,118)	94,116)	(13,062)	32,981)	(44,205)
Comprehensive income including noncontrolling interest	1,641,699)	1,576,935)	1,262,351)	1,179,733)	1,126,846)
Comprehensive (gain) loss attributable to noncontrolling interest	—)	(10,556)	2,241)	2,773)	7,682)
Comprehensive income attributable to The Hershey Company	1,641,699)	1,566,379)	1,264,592)	1,182,506)	1,134,528)

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

The financial trajectory from 2018 to 2022 is characterized by steady growth in bottom-line profitability, with net income and comprehensive income demonstrating a consistent upward trend after 2019. Net income rose from US$ 1.17 billion in 2018 to US$ 1.64 billion by 2022, representing a significant increase in overall earning capacity over the five-year period.

Net Income and Comprehensive Income Trends: Net income experienced a slight dip in 2019 before entering a period of sustained growth, increasing by approximately 29% between 2020 and 2022. Comprehensive income followed a nearly identical trajectory, growing from US$ 1.13 billion in 2018 to US$ 1.64 billion in 2022. The close alignment between these two figures suggests that while other comprehensive income items created volatility, they did not fundamentally alter the long-term growth trend of the company's earnings.
Volatility in Other Comprehensive Income (OCI): Other comprehensive income exhibited significant annual volatility, oscillating between gains and losses. A notable peak occurred in 2021 with a gain of US$ 94.1 million, contrasted by a loss of US$ 44.2 million in 2018. This volatility is primarily attributed to fluctuations in pension and post-retirement benefit plans and foreign currency translation adjustments.
Pension and Actuarial Impacts: Pension and post-retirement benefit plans acted as a primary driver of OCI variance. A substantial actuarial gain in 2021 contributed to the surge in comprehensive income for that year, whereas actuarial losses in 2018, 2020, and 2022 created downward pressure on the comprehensive total. The volatility in these figures indicates exposure to changes in discount rates or asset performance within retirement funds.
Currency and Hedging Effects: Foreign currency translation adjustments remained inconsistent, resulting in losses in 2018, 2020, and 2022, with a gain only appearing in 2019. Conversely, cash flow hedges showed a trend toward positive contributions in the latter half of the period, with gains reported in 2020, 2021, and 2022, suggesting an effective hedging strategy to mitigate financial risks.
Noncontrolling Interest Analysis: The impact of noncontrolling interests on comprehensive income was relatively minimal compared to total earnings. However, a shift occurred in 2021, where a comprehensive loss of US$ 10.56 million was attributable to noncontrolling interests, which served to slightly increase the comprehensive income attributable to the parent company.

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