Hershey Co., FCFF calculation

US$ in thousands

12 months ended:	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
Net income attributable to The Hershey Company	1,644,817)	1,477,512)	1,278,708)	1,149,692)	1,177,562)
Net (gain) loss attributable to noncontrolling interest	—)	5,307)	(3,295)	(2,940)	(6,511)
Net noncash charges	790,943)	604,859)	627,563)	548,739)	526,021)
Changes in assets and liabilities, net of business acquisitions and divestitures	(107,923)	(4,794)	(203,319)	68,382)	(97,079)
Net cash provided by operating activities	2,327,837)	2,082,884)	1,699,657)	1,763,873)	1,599,993)
Interest paid, net of tax¹	113,048)	105,374)	128,743)	115,928)	109,963)
Capitalized interest, net of tax²	6,976)	7,681)	5,743)	4,641)	4,226)
Capital additions, including software	(519,481)	(495,877)	(441,626)	(318,192)	(328,601)
ROU assets obtained in exchange for lease liabilities, finance leases	(9,617)	6,424)	(3,992)	(7,943)	—)
Free cash flow to the firm (FCFF)	1,918,763)	1,706,486)	1,388,526)	1,558,307)	1,385,582)

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).

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Item	Description	The company
FCFF	Free cash flow to the firm is the cash flow available to the Hershey Co. suppliers of capital after all operating expenses have been paid and necessary investments in working and fixed capital have been made.	Hershey Co. FCFF increased from 2020 to 2021 and from 2021 to 2022.

Hershey Co., interest paid, net of tax calculation

US$ in thousands

12 months ended:	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
Effective Income Tax Rate (EITR)
EITR¹	14.20%	17.50%	14.70%	16.90%	17.00%
Interest Paid, Net of Tax
Interest paid, before tax	131,757)	127,726)	150,930)	139,504)	132,486)
Less: Interest paid, tax²	18,709)	22,352)	22,187)	23,576)	22,523)
Interest paid, net of tax	113,048)	105,374)	128,743)	115,928)	109,963)
Interest Costs Capitalized, Net of Tax
Capitalized interest, before tax	8,131)	9,310)	6,733)	5,585)	5,092)
Less: Capitalized interest, tax³	1,155)	1,629)	990)	944)	866)
Capitalized interest, net of tax	6,976)	7,681)	5,743)	4,641)	4,226)

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).

¹ See details »

² 2022 Calculation
Interest paid, tax = Interest paid × EITR
= 131,757 × 14.20% = 18,709

³ 2022 Calculation
Capitalized interest, tax = Capitalized interest × EITR
= 8,131 × 14.20% = 1,155

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Hershey Co., current EV/FCFF calculation, comparison to benchmarks

Selected Financial Data (US$ in thousands)
Enterprise value (EV)	52,082,977)
Free cash flow to the firm (FCFF)	1,918,763)
Valuation Ratio
EV/FCFF	27.14
Benchmarks
EV/FCFF, Competitors¹
Altria Group Inc.	11.85
Coca-Cola Co.	27.72
PepsiCo Inc.	27.50
Philip Morris International Inc.	28.08
EV/FCFF, Sector
Food, Beverage & Tobacco	25.42
EV/FCFF, Industry
Consumer Staples	35.57

Based on: 10-K (reporting date: 2022-12-31).

¹ Click competitor name to see calculations.

If the company EV/FCFF is lower then the EV/FCFF of benchmark then company is relatively undervalued.
Otherwise, if the company EV/FCFF is higher then the EV/FCFF of benchmark then company is relatively overvalued.

Hershey Co., historical EV/FCFF calculation, comparison to benchmarks

	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
Selected Financial Data (US$ in thousands)
Enterprise value (EV)¹	53,436,870)	46,279,575)	34,804,244)	37,362,005)	26,861,195)
Free cash flow to the firm (FCFF)²	1,918,763)	1,706,486)	1,388,526)	1,558,307)	1,385,582)
Valuation Ratio
EV/FCFF³	27.85	27.12	25.07	23.98	19.39
Benchmarks
EV/FCFF, Competitors⁴
Altria Group Inc.	11.86	13.00	11.79	12.41	—
Coca-Cola Co.	27.95	25.28	26.04	28.08	—
PepsiCo Inc.	40.39	33.08	30.09	35.72	—
Philip Morris International Inc.	19.53	16.35	16.31	16.47	—
EV/FCFF, Sector
Food, Beverage & Tobacco	23.90	21.47	20.59	22.56	—
EV/FCFF, Industry
Consumer Staples	27.96	19.75	21.80	22.08	—

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).

¹ See details »

² See details »

³ 2022 Calculation
EV/FCFF = EV ÷ FCFF
= 53,436,870 ÷ 1,918,763 = 27.85

⁴ Click competitor name to see calculations.

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Valuation ratio	Description	The company
EV/FCFF	Enterprise value to free cash flow to the firm is whole company valuation indicator.	Hershey Co. EV/FCFF ratio increased from 2020 to 2021 and from 2021 to 2022.

Hershey Co. (NYSE:HSY)

Enterprise Value to FCFF (EV/FCFF)

Free Cash Flow to The Firm (FCFF)

Interest Paid, Net of Tax

Enterprise Value to FCFF Ratio, Current

Enterprise Value to FCFF Ratio, Historical