TR · Tootsie Roll Industries, Inc.

Tootsie Roll Industries' first quarter 2026 results showed modest top-line growth with net sales rising 2% to $149.5 million, attributed to successful marketing, sales programs, trade promotions, and distribution efforts supporting its brands. However, net earnings fell slightly to $17.7 million from $18.1 million in the prior year, with EPS holding steady at $0.24 due to a minor reduction in average shares outstanding to 75.1 million, adjusted for stock dividends. Key pressures included significantly higher cocoa and chocolate unit costs, which eroded gross profit margins; management notes cocoa prices have retreated from 2025 peaks but remain elevated, with relief expected in late 2026 and 2027 as lower costs flow through the supply chain. Additional headwinds were unfavorable international results and expanded trade promotions. Positively, increased investment income from marketable securities provided a boost. The effective tax rate rose to 25.1% from 21.6%, driven by non-deductible deferred compensation. Chairman Ellen R. Gordon emphasized a long-term focus, with ongoing investments in manufacturing to enhance capacity, product quality, and efficiencies amid monitored input costs and pricing constraints to consumers. No formal guidance was issued, but forward-looking comments highlight risks from tariffs, competition, and seasonal sell-through.