McCormick is reporting lower profits and brand marketing spend for Q1, but reaffirmed its sales guidance and noted “on fire” hot sauce performance for North America.

The maker of French’s, Club House, Frank’s Redhot and Billy Bee is reporting net income for the quarter ending Feb. 28 fell to $139.1 million USD from $154.9 million USD in the same period a year ago.

However, the CPG expects to grow sales by 5% to 7% this year, driven primarily by pricing actions, which in conjunction with cost savings, are expected to offset inflationary pressures.

Despite the profit dip, sales increased 3% in the first quarter due to the impact of McCormick’s divesture of ready-to-use broth line Kitchen Basics to Del Monte Foods, as well as decreased Chinese consumption and its exit from Russia.

McCormick says it also expects to drive continued growth through the strength of its brands, as well as brand marketing, new products, category management and differentiated customer engagement plans.

In this morning’s earnings call, McCormick chair and CEO Lawrence Kurzius said that its first quarter sales performance reflects the strength of its broad global portfolio and effective execution of its strategies.

In the Americas, flavor solutions sales rose 13%, “outstanding” performance compared to the first quarter of 2022, led by snack seasonings growth. McCormick is also driving double digit ecomm growth led by spices and seasoning.

Despite its dip in over marketing spend, McCormick is planning to invest in brand marketing, which it says has been successful for its French’s Mustard “Flavour On” campaign.

One area that will see marketing focus is hot sauce, which is “on fire” in the U.S. and Canada, Kurzius claimed. Frank’s RedHot marketing, recently included a Fortnite execution that captured one billion impressions, Kurzius said.

In March, the company also announced the redesign of its everyday red cap-branded spices stateside, the first time it has done so in forty years. This includes Cinnamon, Garlic Powder, Paprika, Parsley, and Crushed Red Pepper with “consumer-preferred packaging” including new lids to seal freshness and a product name that is easier to read. New ad spend will be highest in five years for the red-cap spices. The initiative, coupled with other product innovations, will build market share improvement and distribution points, Kurzius said.