ORRVILLE, Ohio (AP) — J.M. Smucker's first-quarter net income climbed 14 percent as costs fell, adjusted net income and revenue beat Wall Street expectations.
The company known for brands including Folgers, Jif and Hungry Jack boosted its full-year adjusted earnings forecast but lowered its revenue guidance.
For the three months ended July 31, J.M. Smucker earned $126.6 million, or $1.19 per share. That compares with $110.9 million, or $1 per share, a year ago.
J.M. Smucker Co. said that special project costs were $20.6 million lower in the latest quarter compared with the prior-year.
Stripping out these costs, earnings were $1.24.
Analysts expected earnings of $1.20 per share, according to a FactSet survey.
Revenue for the Orrville, Ohio company dipped 2 percent to $1.35 billion from $1.37 billion due to lower prices, particularly for coffee and peanut butter.
Walll Street was calling for $1.34 billion in revenue.
Coffee revenue in the U.S. fell 1 percent on declining prices. Sales of K-Cup packs increased 14 percent to $7.5 million. In the U.S. retail consumer foods unit, revenue edged up 1 percent as sales of Smucker's Uncrustables frozen sandwiches rose 23 percent. Crisco sales climbed 10 percent, while sales of canned milk increased 12 percent. Pillsbury sales rose 2 percent on better sales of flour and frostings.
Revenue for the international, foodservice and natural foods division dropped 6 percent on lower volume.
Overall volume edged up 1 percent thanks to gains in Jif peanut butter, Crisco oils and Folgers coffee.
Gross profit increased 5 percent on lower commodity costs, better volume and a favorable product mix.
Smucker now anticipates fiscal 2014 adjusted earnings of $5.72 to $5.82 per share. Previously the company predicted adjusted earnings of $5.65 to $5.75 per share. Revenue is now expected to drop about 1 percent, compared with a prior forecast for sales to be flat compared with year-ago levels.
Analysts predict full-year earnings of $5.77 per share.
Smucker also announced on Wednesday that it has closed on its acquisition of Enran Inc. Financial terms were not disclosed. The privately held company, which is based in Livermore, Calif., makes organic, gluten-free products mostly under the brand truRoots.
CEO Richard Smucker said the buyout will strengthen its existing natural foods business.