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(Bloomberg) -- Hershey Co. Chief Executive Officer Michele Buck will step down from her role next year and the company has started a search for her successor.
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Buck, 63, told the board that she intends to retire on June 30, 2026, Hershey announced in a statement Friday. She will stay on as CEO and as a board member until a new leader is found. Then she’ll resign from the board and transition to an advisory role until her retirement.
Hershey shares fell 2.5% in New York trading Friday. The stock has declined 6.6% this month after posting a 9.2% drop in 2024.
The board is considering internal and external CEO candidates and has appointed a special committee to direct the search. Buck has led Hershey since 2017, with shares rising 45% during her tenure. That’s below the advance of the S&P 500 Index over the same period.
The leadership transition follows a sustained rise in cocoa prices that has put pressure on the maker of Reese’s Peanut Butter Cups and Almond Joy treats. While Hershey owns snacking brands such as Dot’s Homestyle Pretzels and Skinnypop popcorn, the company is seen as less diversified in its product portfolio than competitors such as Mondelez International Inc., Mars Inc. and Nestle SA.
Nestle has a wider range of products spanning from dairy to coffee, while Mars has invested in pet food and last year announced the purchase of snacks maker Kellanova. Mondelez, which recently tried to buy Hershey, has profited from the growing popularity of Oreo cookies and also owns brands like Triscuits candy and Halls candy.
“We believe the announcement will act as a near-term overhang until the next leadership team is announced,” Stephens analysts including Jim Salera wrote in a research note. They added that there’s still uncertainty regarding consumers, who have pulled back spending amid higher prices, and how cocoa prices will progress.
Cocoa prices almost tripled last year as disease and bad weather hurt crops in Ivory Coast and Ghana, which usually account for more than 60% of global supply. Beans are so scarce that Hershey is asking the US’s top derivatives regulator for permission to buy a huge amount through the New York exchange, according to people familiar with the matter.
Hershey wants to take a position that will allow it to purchase more than 90,000 metric tons of cocoa on ICE Futures US, said the people, who asked not to be identified because the information is private. The request to the Commodity Futures Trading Commission equates to about 5,000 20-foot containers and is more than nine times the amount the exchange currently allows.