The J.M. Smucker Co. on Tuesday released quarterly earnings that were up compared to the first quarter of the 2018 fiscal year, but missed Wall Street projections for the company’s performance.
The company announced in a news release adjusted earnings per share of $1.78 per share for the first quarter of the 2019 fiscal year, which ended July 31. That’s $0.03 per share shy of the the estimate Zacks Investment Research issued for the company, but an 18 percent increase over earnings during the first quarter of the 2018 fiscal year.
Smucker’s recent acquisition of Ainsworth Pet Nutrition drove much of that increase, according to the release.
“Our strong first quarter earnings reflect the execution of our strategy, aligning our portfolio for growth in pet food, coffee, and snacking,” Mark Smucker, the company’s CEO, said in the release. “During the first quarter, we completed the Ainsworth acquisition, which drove much of our year-over-year sales growth, and we are making significant progress toward integrating the business.”
Overall, net sales totaled $1.9 billion, a 9 percent increase over the first quarter of last year. Excluding Ainsworth, though, net sales decreased $9.2 million, or 1 percent, according to the release.
Aside from the growth in the company’s pet food segment, Mark Smucker also said several food and coffee brands contributed to the increased earnings.
“We also announced a planned divestiture of our U.S. baking business, which is expected to close at the end of this month,” he said in the release. “In addition, we had strong first quarter performance for key growth brands, including Dunkin’ Donuts, Smucker’s Uncrustables, Nature’s Recipe and Café Bustelo, while continuing to execute our cost reduction programs to enhance margins and provide fuel for investments in future growth.”
After the July 9 announcement that Smucker would sell its U.S. baking business — including the Pillsbury, Martha White, Hungry Jack, White Lily and Jim Dandy brands — the company on Tuesday also adjusted its forecast for the 2019 fiscal year. According to the news release, the company still expects earnings per share of between $8.40 and $8.65 on the year, but expects $8 billion in net sales instead of the previously estimated $8.3 billion.
The company’s stock fell more than 6.5 percent Tuesday, closing the day at $108.20 per share. A year ago, the stock sold at $119.86 per share.
The J.M. Smucker Co. employs about 7,500 people worldwide, including approximately 1,700 at its corporate headquarters in Orrville.
CREDIT: JACK ROONEY
Copyright The Daily Record Aug 23, 2018