markets its turkey products through its own sales force and independent brokers.
The acquisitions of Diamond Crystal Brands Nutritional Products in fiscal 2001 and the Century Foods International business in July of fiscal 2003
strengthened the Company's presence in the nutritional food products and supplements market. The Company currently operates as one of the largest
companies providing nutritional products to the U.S. healthcare industry.
The Company acquired the Diamond Crystal Brands business from Imperial Sugar Co. in December of fiscal 2003. Diamond Crystal Brands packages
and sells various sugar, sugar substitute, salt and pepper products, savory products, drink mixes and dessert mixes to retail and foodservice customers.
Internationally, the Company markets its products through Hormel Foods International Corporation (HFIC), a wholly owned subsidiary. HFIC has a
presence in the international marketplace through joint ventures and placement of personnel in strategic foreign locations such as China, Spain, and the
Philippines. HFIC also has a global presence with minority positions in food companies in Spain (Campofrio Alimentacion S.A., 15% holding) and the
Philippines (Purefoods-Hormel, 40% holding).
 
 
The Company has not been involved in any bankruptcy, receivership or similar proceedings during its history. Substantially all of the assets of the
Company have been acquired in the ordinary course of business.
The Company had no significant change in the type of products produced or services rendered, nor in the markets or methods of distribution since the
beginning of the fiscal year.
(b)   
Industry Segment
The Company's business is reported in five segments: Grocery Products, Refrigerated Foods, Jennie-O Turkey Store, Specialty Foods, and All Other.
The contributions of each segment to net sales to unaffiliated customers and operating profit, and the presentation of certain other financial information by
segment are reported in Note K of the Notes to Consolidated Financial Statements and in the Management's Discussion and Analysis of the Annual
Stockholder's Report for the year ended October 25, 2003, incorporated herein by reference.
(c)   
Description of Business
Products and Distribution
The Company's products primarily consist of meat and other food products. The meat products are sold fresh, frozen, cured, smoked, cooked and
canned. The percentages of total revenues contributed by classes of similar products for the last three fiscal years of the Company are as follows:
 
 
 
 
 
 
 
 
Perishable meat
 
50.3
%
53.0
%
54.7
%
Nonperishable meat
 
18.9
 
19.8
 
21.0
 
Poultry
 
22.1
 
22.6
 
20.3
 
Other
 
8.7
 
4.6
 
4.0
 
 
 
 
 
 
 
 
100.0
%
100.0
%
100.0
%
 
 
 
 
 
Reporting of revenues from external customers is based on similarity of products, as the same or similar products are sold across multiple distribution
channels such as retail, foodservice or international. Revenues reported are based on financial information used to produce the Company's general-
purpose financial statements.
Perishable meat includes fresh meats, sausages, hams, wieners and bacon (excluding JOTS products.) Nonperishable meat includes canned luncheon
meats, shelf stable microwaveable entrees, stews, chilies, hash, meat spreads and other items that do not require refrigeration as well as frozen
processed products. The Poultry category is composed primarily of JOTS products. The Other category primarily consists of nutritional food products and
supplements, sugar and sugar substitutes, salt and pepper products, dessert mixes, food packaging (casings for dry sausage), and industrial gelatin
products. The Other category has increased over the past two years primarily due to the following acquisitions: Century Foods International (July 2003),
Diamond Crystal Brands (December 2002), and Diamond Crystal Brands Nutritional Products (April 2001).
No new product in fiscal 2003 required a material investment of Company assets.