Coffee Service

JM Smucker Q3 2021 sales and earnings soar, beat expectations

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February 25, 2021

Net sales for the J.M. Smucker Co., which owns Folgers and other brands, increased 5% from $1.97 billion in the 2020 third quarter to $2.07 billion for the quarter ending Jan. 31, 2021, according to an earnings release. Net sales excluding the noncomparable divested businesses and foreign currency exchange increased 7%, reflecting growth across each of the company's U.S. and international retail businesses, partially offset by a decline in its away from home business.

Operating income rose 41% from $289 million in Q3 2020 to $406.2 million in Q3 2021, while net income per diluted share rose 41% from $1.64 in Q3 2020 to $2.32 for Q3 2021. Adjusted earnings per share rose 4% from $2.35 to $2.45.

The fourth quarter revenue beat analyst projections by $70 million while the Non-GAAP EPS of $2.45 beat expectations by 24 cents and GAAP EPS of $2.32 beat expectations by 19 cents, according to Seeking Alpha.

Shares traded at $117.37 today against a 52-week range of $89.10-$130.67.

"We delivered another quarter of strong financial results, including net sales growth in each of our U.S. and international retail businesses, driven by the elevated at-home consumption trends and ongoing execution of our consumer-centric strategy," Mark Smucker, president and CEO, said in the press release. "We are encouraged by the momentum we are building in our brands and continued improvement in our market share trends. I want to thank all our employees for their commitment to delivering food for consumers and their pets in this unique environment."

The COVID-19 pandemic continues to impact financial results and cause uncertainty for the full-year fiscal 2021 outlook. Changes in consumer purchasing behavior, retailer inventory levels, macroeconomic conditions and any manufacturing or supply chain disruption could materially impact actual results.

Net sales are expected to increase approximately 2% compared to the prior year, primarily reflecting elevated at-home consumption benefiting the U.S. retail coffee and U.S. retail consumer foods segments.

Net sales guidance also reflects a decline for the company's away from home business, the lapping of a $185 million incremental benefit to net sales related to COVID-19 in the fourth quarter of the prior year, and $166 million of noncomparable sales in the prior year from the divested businesses.

Adjusted earnings per share is expected to range from $8.70 to $8.90, based on 112.6 million shares outstanding.

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