Sunday 16 June 2024
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J.M Smucker posts 1.1% decrease in FY U.S. Retail Coffee sales to $2.7B, net profit at $759M (+2.9%)

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MILAN – J.M Smucker reported Thursday better-than-expected 4Q results. The company behind Folgers Coffee and Jif peanut butter posted fourth-quarter fiscal 2024 adjusted earnings per share of $2.66, above the $2.32 consensus of analysts compiled by Visible Alpha. Revenue fell short of forecast at $2.21 billion, down 1.3% from the same quarter of 2023.

Smucker’s gross profit jumped 15.3% to $913.3 million, which it attributed primarily to “a favorable impact from the acquisition of Hostess Brands, lower costs, higher net price realization, and favourable volume/mix.”

The coffee business showed a decline in sales, but an increase in profits.

“Our fourth quarter and full-year results underscore the strength of our business and the demand for our leading brands. Our focus on superior execution and disciplined cost management helped drive our strong results in a dynamic operating environment,” said Mark Smucker, Chair of the Board, President and Chief Executive Officer of J.M. Smucker.

“Our transformed portfolio, including the acquisition of Hostess Brands during the fiscal year, has strengthened our business for long-term profitable growth across our key platforms of coffee, Uncrustables® frozen sandwiches, dog snacks and cat food, and sweet baked snacks.”

“Looking ahead, fiscal year 2025 will be a year of investment in our brands, capabilities, and talented employees, who have been instrumental to our success. Our strategy is working and our priorities are clear: deliver our core business, successfully integrate the Hostess business, achieve our synergy aspirations, and advance our transformation and cost discipline activities. We are confident we are well-positioned to deliver long-term growth and increase shareholder value.”

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J.M Smucker: Executive Summary

  • Net sales for the quarter were $2.2 billion, a decrease of $29.1 million, or 1 percent. Net sales for the quarter excluding the acquisition, divestitures, and foreign currency exchange increased 3 percent.
  • For the fiscal year, net sales were $8.2 billion, a decrease of 4 percent. Net sales excluding the acquisition, divestitures, and foreign currency exchange increased 8 percent.
  • Net income per diluted share for the quarter was $2.30. Adjusted earnings per share was $2.66, an increase of 1 percent.
  • For the fiscal year, net income per diluted share was $7.13. Adjusted earnings per share was $9.94, an increase of 11 percent.
  • Cash provided by operations for the quarter was $428.1 million compared to $443.8 million in the prior year. Free cash flow was $297.5 million for the quarter and $642.9 million for the fiscal year.
  • Return of cash to shareholders through dividends was $112.0 million for the quarter and $437.5 million for the fiscal year.
  • The Company provided its fiscal year 2025 outlook, with net sales expected to increase 9.5 to 10.5 percent, adjusted earnings per share to range from $9.80 to $10.20, and free cash flow of $900.0 million.

U.S. Retail Coffee

Net sales decreased $26.4 million, or 4 percent, to $666.1. Net price realization decreased net sales by 2 percentage points, primarily driven by list price decreases, partially offset by reduced trade spend. Volume/mix decreased net sales by 2 percentage points, primarily driven by the Folgers® brand, partially offset by increased contributions from the Café Bustelo and Dunkin’ brands.

Segment profit increased $10.2 million (+5%) to $210.3 million, primarily driven by lower commodity costs, partially offset by lower net price realization and increased marketing and distribution expenses.

Full-year net sales were down by 1.1% to $2,704.4 million, while net profits rose by 2.9% to $759.2 million.

Segment profit margin rose from 28.9 % to 31.6 % for Q4 and 27.0 % and 28.1 %.

CIMBALI

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