Company: TR
Filing Date: 2025-08-08
Form Type: 10-Q
Source: 0001558370-25-010878
Chunk: 10

Company: TOOTSIE ROLL INDUSTRIES INC
Filing Date: 2025-08-08
Form: 10-Q
Item: Part I, Item 2
Chunk 10
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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This financial review discusses the Company’s financial condition, results of operations, liquidity and capital resources and other matters. Dollars are presented in thousands, except per share amounts. This review should be read in conjunction with the accompanying Condensed Consolidated Financial Statements and related notes included in this Form 10-Q and with the Company’s Consolidated Financial Statements and related notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in the Company’s Form 10-K for the year ended December 31, 2024 (the “2024 Form 10-K”).

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Net product sales were $153,190 in second quarter 2025 compared to $148,819 in second quarter 2024, an increase of $4,371 or 2.9%. First half 2025 net product sales were $299,711 compared to $300,283 in first half 2024, a decrease of $572 or 0.2%. Domestic (U.S.) net product sales in second quarter and first half 2025 increased by 4.6% and 1.4% compared to the corresponding period in the prior year; and foreign net product sales, including exports to foreign markets and the effects of foreign translations, decreased 16.8% and 16.5%, respectively, compared to the corresponding period in the prior year. For the second quarter and first half 2025, domestic sales represented 93.8% and 92.6%, respectively, of total consolidated net product sales. Successful marketing and sales programs contributed to higher sales in second quarter 2025 compared to the prior year second quarter, however, the timing of sales, including seasonal sales, between second and third quarter 2025 did provide some additional benefit to second quarter 2025 when compared to second quarter 2024.  The Company continued to face a challenging market in second quarter and first half 2025 as customers and consumers have become more resistant to higher price realization. 

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Product cost of goods sold was $98,127 in second quarter 2025 compared to $99,732 in second quarter 2024, and $193,627 in first half 2025 compared to $202,464 in first half 2024. Product cost of goods sold includes $467 and $122 of certain deferred compensation expenses in second quarter 2025 and 2024, respectively,