The Hershey Company Announces Pricing of $500,000,000 4.550% Notes Due 2028, $500,000,000 4.750% Notes Due 2030, $500,000,000 4.950% Notes Due 2032 and $500,000,000 5.100% Notes Due 2035

Rhea-AI Summary

The Hershey Company (NYSE: HSY) has announced the pricing of a significant notes offering totaling $2 billion. The offering consists of four tranches: $500 million of 4.550% notes due 2028, $500 million of 4.750% notes due 2030, $500 million of 4.950% notes due 2032, and $500 million of 5.100% notes due 2035.

The company plans to use the proceeds to repay its outstanding 0.900% Senior Notes due 2025 and 3.200% Senior Notes due 2025, along with certain outstanding short-term commercial paper borrowings. The remaining funds will cover offering-related fees and expenses, and support general corporate purposes.

Positive

• Successful $2 billion debt offering indicates strong market confidence
• Debt restructuring from lower to higher interest rates suggests proactive financial management
• Extended debt maturity profile through 2035 improves financial flexibility

Negative

• Higher interest rates on new notes (4.550%-5.100%) compared to existing notes (0.900%-3.200%) will increase interest expenses
• Taking on $2 billion in new debt could impact the company's leverage ratios

Insights

Fixed Income Analyst

This $2 billion notes offering represents a strategic debt restructuring that will significantly impact Hershey's financial position. The company is effectively extending its debt maturity profile while managing interest rate risk in the current environment. The new notes, ranging from 4.550% to 5.100%, reflect a substantial premium over the retiring 2025 notes (0.900% and 3.200%), but this increase is primarily due to the broader interest rate environment rather than company-specific credit concerns.

The transaction demonstrates sophisticated liability management by: 1) eliminating near-term refinancing risk by extending maturities out to 2035, 2) reducing reliance on short-term commercial paper, which typically carries greater refinancing risk, and 3) locking in fixed rates before potential future rate increases. The staggered maturity structure (2028, 2030, 2032, and 2035) helps minimize future refinancing concentration risk.

The equal distribution of $500 million across four tranches suggests strong market demand and provides Hershey with a balanced debt ladder. While the higher coupon rates will increase annual interest expenses, the company's robust operating cash flow (typically over $1.5 billion annually) should comfortably cover these obligations. This refinancing aligns with Hershey's conservative financial management approach and maintains its strong investment-grade credit profile.

HERSHEY, Pa., Feb. 19, 2025 /PRNewswire/ -- The Hershey Company ("Hershey" or the "Company") (NYSE: HSY) announced today the pricing of its offering of $500,000,000 of 4.550% notes due 2028, $500,000,000 of 4.750% notes due 2030, $500,000,000 of 4.950% notes due 2032 and $500,000,000 of 5.100% notes due 2035 (the "Notes Offering") in a public offering. The Company intends to use the net proceeds of the Notes Offering to repay all of its outstanding 0.900% Senior Notes due 2025 and 3.200% Senior Notes due 2025, as well as certain outstanding short-term commercial paper borrowings, plus in each case, accrued and unpaid interest thereon, pay fees and expenses related to the offering and for general corporate purposes.

A registration statement relating to the Notes Offering has been filed with the U.S. Securities and Exchange Commission and is effective. This press release shall not constitute an offer to sell or an offer to buy any securities and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale would be unlawful. The Notes Offering may be made only by means of a prospectus supplement and the accompanying prospectus.

Copies of the prospectus supplement and the accompanying prospectus for the Notes Offering may be obtained by contacting BofA Securities, Inc., NC1-002-02-25, 201 North Tryon Street, Charlotte, NC 28255-0001, Attention: Prospectus Department, email: dg.prospectus_requests@bofa.com, toll-free: 1 (800) 294-1322; Citigroup Global Markets Inc., c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, toll-free: 1 (800) 831-9146, email: prospectus@citi.com; J.P. Morgan Securities LLC, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, email: prospectus-eq_fi@jpmchase.com; RBC Capital Markets, LLC, Brookfield Place, 200 Vesey Street, 8th Floor, New York, NY 10281 toll-free: 1 (866) 375-6829, fax: 1 (212) 428-6308, email: rbcnyfixedincomeprospectus@rbccm.com; and U.S. Bancorp Investments, Inc., 214 North Tryon Street, 26th Floor, Charlotte, NC 28202, Attention: Debt Capital Markets, toll-free: 1 (877) 558-2607.

About The Hershey Company
The Hershey Company is headquartered in Hershey, Pa., and is an industry-leading snacks company known for making more moments of goodness through its iconic brands, remarkable people and enduring commitment to doing the right thing for its people, planet, and communities. Hershey has more than 20,000 employees in the U.S. and worldwide who work daily to deliver delicious, high-quality products. Hershey has more than 90 brand names in approximately 80 countries, including Hershey's, Reese's, Kisses, Kit Kat®, Jolly Rancher, Twizzlers and Ice Breakers, and salty snacks including SkinnyPop, Pirates Booty and Dot's Homestyle Pretzels.

For over 130 years, Hershey has been committed to operating fairly and ethically. The candy and snack maker's founder, Milton Hershey, created the Milton Hershey School in 1909, and since then, Hershey has focused on helping children succeed through equitable access to education.

Forward-Looking Statements
Statements in this press release may be "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Many of these forward-looking statements can be identified by the use of words such as "anticipate," "assume," "believe," "continue," "estimate," "expect," "forecast," "future," "intend," "plan," "potential," "predict," "project," "strategy," "target" and similar terms, and future or conditional tense verbs like "could," "may," "might," "should," "will" and "would," among others. These statements are made based upon current expectations that are subject to risk and uncertainty. Because actual results may differ materially from those contained in the forward-looking statements, you should not place undue reliance on the forward-looking statements when deciding whether to buy, sell or hold the Company's securities. Factors that could cause results to differ materially include, but are not limited to: disruptions or inefficiencies in our supply chain due to the loss or disruption of essential manufacturing or supply elements or other factors; issues or concerns related to the quality and safety of our products, ingredients or packaging, human and workplace rights, and other environmental, social or governance matters; changes in raw material and other costs, along with the availability of adequate supplies of raw materials and the Company's ability to successfully hedge against volatility in raw material pricing; the Company's ability to successfully execute business continuity plans to address changes in consumer preferences and the broader economic and operating environment; selling price increases, including volume declines associated with pricing elasticity; market demand for our new and existing products; increased marketplace competition; failure to successfully execute and integrate acquisitions, divestitures and joint ventures; changes in governmental laws and regulations, including taxes; political, economic, and/or financial market conditions, including with respect to inflation, rising interest rates, slower growth or recession, and other events beyond our control such as the impacts on the business arising from the conflict between Russia and Ukraine; risks and uncertainties related to our international operations; disruptions, failures or security breaches of our information technology infrastructure and that of our customers and partners (including our suppliers); our ability to hire, engage and retain a talented global workforce, our ability to realize expected cost savings and operating efficiencies associated with strategic initiatives or restructuring programs; complications with the design, implementation or usage of our new enterprise resource planning system, including the ability to support post-implementation efforts and maintain enhancements, new features or modifications; and such other matters as discussed in our Annual Report on Form 10-K for the year ended December 31, 2024 and our other filings with the U.S. Securities and Exchange Commission from time to time. The Company undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the Company's expectations.

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SOURCE The Hershey Company

FAQ

What is the total value of Hershey's (HSY) February 2025 notes offering?

Hershey's notes offering totals $2 billion, consisting of four $500 million tranches.

What are the interest rates for HSY's new notes issued in February 2025?

The notes carry interest rates of 4.550% (2028), 4.750% (2030), 4.950% (2032), and 5.100% (2035).

How will Hershey (HSY) use the proceeds from its 2025 notes offering?

Hershey will use the proceeds to repay 0.900% and 3.200% Senior Notes due 2025, outstanding commercial paper, offering expenses, and general corporate purposes.

What is the maturity schedule for HSY's new notes issued in February 2025?

The notes mature in 2028, 2030, 2032, and 2035, with $500 million maturing in each year.