Thursday 05 October 2023

JM Smucker reports 4Q US Retail Coffee sales up 7% to $692.5 million

"Our strong fourth quarter and full-year results demonstrate the execution of our strategy and consumer demand for our brands," said Mark Smucker, Chair of the Board, President and Chief Executive Officer. "During the quarter, we made meaningful progress in our effort to reshape our portfolio with the completion of the divestiture of certain pet food brands, while also returning significant cash to our shareholders"

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ORRVILLE, Ohio, USA – The J.M. Smucker Co. yesterday announced results for the fourth quarter of its fiscal year ending April 30, 2023. Financial results for the fourth quarter and fiscal year reflect the divestitures of certain pet food brands on April 28, 2023, the natural beverage and grains businesses on January 31, 2022, and the private label dry pet food business on December 1, 2021. All comparisons are to the fourth quarter of the prior fiscal year, unless otherwise noted.

Executive Summary:

  • Net sales were $2.2 billion, an increase of 10 percent. Net sales excluding the impact of divestitures and foreign currency exchange increased 11 percent.
  • For the fiscal year, net sales were $8.5 billion, an increase of 7 percent. Net sales excluding the impact of divestitures and foreign currency exchange increased 9 percent.
  • Net loss per diluted share for the quarter was $5.69, reflecting a loss related to the divestiture of certain pet food brands. Adjusted earnings per share was $2.64, an increase of 18 percent.
  • For the full year, net loss per diluted share was $0.86. Adjusted earnings per share was $8.92, slightly ahead of the prior year.
  • Cash from operations was $437.4 million compared to $393.7 million in the prior year. Free cash flow was $298.7 million in the quarter and $717.0 million for the full year.
  • Return of capital to shareholders, reflecting cash dividends and share repurchases, was $467.9 million in the quarter and $797.7 million for the full year.
  • The J.M. Smucker Co. provided its fiscal year 2024 outlook, with an expected comparable net sales increase of 8.5 to 9.5 percent, adjusted earnings per share to range from $9.20 to $9.60, and free cash flow of $650 million.

“Our strong fourth quarter and full-year results demonstrate the execution of our strategy and consumer demand for our brands,” said Mark Smucker, Chair of the Board, President and Chief Executive Officer. “During the quarter, we made meaningful progress in our effort to reshape our portfolio with the completion of the divestiture of certain pet food brands, while also returning significant cash to our shareholders.”

“Looking ahead to fiscal year 2024, we are focusing on sustaining our business momentum by investing in growth platforms, such as Uncrustables® sandwiches and Milk-Bone® dog treats, and supporting our talented employees whose hard work and dedication have been instrumental to our success. We are confident in our long-term strategy of leading in the attractive categories of pet, coffee, and snacking and delivering shareholder value.”

U.S. Retail Coffee

Net sales increased $45.3 million, or 7 percent, to $692.5 million. Higher net price realization increased net sales by 10 percentage points, primarily reflecting list price increases across the portfolio. A reduced contribution from volume/mix decreased net sales by 3 percentage points, primarily driven by roast and ground coffee.

Segment profit increased $35.9 million, to $200.1 million, primarily reflecting lower marketing spend and a favorable net impact of higher net price realization and increased commodity costs.

The J.M. Smucker Co.: International and Away From Home

Net sales increased $32.4 million, or 12 percent. Excluding unfavorable foreign currency exchange of $7.7 million and $0.2 million of noncomparable net sales in the prior year related to the divested pet food brands, net sales increased $40.3 million, or 15 percent. Comparable net sales increased 25 percent and 4 percent for the Away From Home and International operating segments, respectively.

Net price realization contributed a 13 percentage point increase to net sales for the combined businesses, primarily reflecting list price increases across the portfolio. Volume/mix increased net sales by 2 percentage points, primarily driven by coffee and frozen handheld products, partially offset by baking mixes and ingredients and fruit spreads.

Segment profit increased $13.1 million, primarily reflecting a favorable net impact of higher net price realization and increased commodity costs.

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