J.M. Smucker Profit Jumps 42%; Company Sees Higher Costs
Peanut butter and jelly maker J.M. Smucker said Friday quarterly profit rose a better-than-expected 42 percent, helped by the acquisition of dairy company Eagle Family Foods, lower restructuring costs and gross margin improvement.
The maker of Jif peanut butter and Smucker's jelly said net income for the fiscal first quarter ended July 31 was $40.8 million, or 71 cents per share, compared with $28.7 million, or 50 cents per share, a year earlier.
Excluding restructuring costs of 1 cent a share, it earned 72 cents a share, beating analysts' average expectation of 67 cents a share, according to Reuters Estimates.
Quarterly sales rose 7 percent to $561.5 million. The Eagle Family Foods business was responsible for half of the total increase in sales, Smucker said, also citing its Jif, Crisco, Pillsbury and Uncrustables brands for adding to sales growth.
Orrville, Ohio-based Smucker said it had faced significantly higher commodity costs -- particularly for milk, soybean oil, wheat and peanuts -- in the first quarter, and as a result, anticipates further pricing actions.
The company said it expects raw material costs to keep rising in the foreseeable future.