KMB Kimberly Clark Corp

By Nina Trentmann 

Hershey Co. is turning to a finance chief from outside the food industry, a move that comes as the company expands beyond its core portfolio of chocolate and other confectionery.

The Hershey, Pa.-based company on Thursday named Steve Voskuil senior vice president and chief financial officer, effective May 13.

Mr. Voskuil joins from medical devices maker Avanos Medical Inc., a company that spun out from consumer goods giant Kimberly-Clark Corp. in 2014.

Before the spin, Mr. Voskuil had worked in several finance roles at Kimberly-Clark, the company behind Andrex toilet paper and Huggies diapers, since December 1991. He became CFO of Avanos, which makes feeding tubes and catheters, in late 2014, according to regulatory filings.

Mr. Voskuil joins Hershey as the maker of chocolate Kisses and Reese's Peanut Butter Cups ventures into new product categories under the leadership of Chief Executive Michele Buck. Hershey purchased Amplify Snack Brands, known for its SkinnyPop popcorn, for about $1.6 billion in December 2017. And the company struck a $420 million deal to acquire Pirate Brands, a puffed-rice snack maker, in September 2018.

"The appointment tells me that Michele [Buck] wants a broader base of experience," said Jonathan Feeney, an analyst at Consumer Edge Research LLC. "It is a good hire at a time when the company is expanding beyond its core remit, chocolate," Mr. Feeney said.

Hershey also has room for additional acquisitions, he said. The company's leverage--measured by the ratio of net debt to earnings before interest, taxes, depreciation and amortization--is relatively low at 2.3 times, compared with the industry average of above 3.0 times, Mr. Feeney said.

The new CFO's experience planning and executing transactions will come in handy. Mr. Voskuil played a key role in spinning off Avanos from Kimberly-Clark, and then oversaw the sale of Avanos's surgical and infection-prevention business to Owens & Minor Inc. in 2017, said Matt Mishan, an analyst at KeyBanc Capital Markets Inc.

"Both were large and complex transactions," Mr. Mishan said.

At Avanos, Mr. Voskuil dealt with the company's exposure to fluctuating costs for materials used for products such as exam gloves and surgical gowns, according Mr. Mishan.

This experience will also translate well to Hershey, where he will need to manage and hedge raw material costs for commodities such as cocoa and sugar, analysts said.

Hershey is "progressing towards our vision to be an innovative snacking powerhouse, as evidenced by our acquisitions of Amplify and Pirate Brands," a spokeswoman said in a statement. Mr. Voskuil has "the right blend of strategic, operational and transformational experience to help take our business to the next level," she said.

Mr. Voskuil had a good reputation among Avanos investors, said Ravi Misra, an analyst at Berenberg Capital Markets LLC. "They [Mr. Voskuil's team] always put out pretty realistic numbers," Mr. Misra said. "They were pretty good at addressing what the issues were and how they were addressing those issues."

Those communication skills will also be required in the new job. "Our newly announced CFO, Steve Voskuil, will be a critical leader to help us deliver results today and help frame the dialogue to drive growth in the future," the Hershey spokeswoman said.

Hiring from outside the sector is a smart move for companies that are in the process of transforming themselves, recruiters said. "Industry or sector changes are becoming more frequent in the consumer goods industry, " said Mickey Matthews, chairman at Stanton Chase, an executive recruitment firm.

Increasing pressure from shareholders, technological innovations and changing consumer tastes are forcing consumer goods companies to overhaul their businesses, Mr. Matthews said.

Thursday's appointment is a "recognition of the fact that the right talent is rare," said Alastair Paton, chairman at recruitment company Signium International Inc. "If you only look in the sector you are operating in, then you limit your choices."

Mr. Voskuil is succeeding the company's current CFO, Patricia Little, who last year said she planned to retire this spring after having served as CFO since 2015.

https://www.wsj.com/articles/hershey-cfo-departs-as-candy-maker-navigates-changing-consumer-tastes-1534438234

Hershey declined to make Mr. Voskuil or Ms. Little available for an interview.

Write to Nina Trentmann at Nina.Trentmann@wsj.com

(END) Dow Jones Newswires

April 18, 2019 15:50 ET (19:50 GMT)

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