Coffee Service

JM Smucker's Q4 2021 sales, earnings tumble

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June 3, 2021

The J.M. Smucker Co., which owns Folgers and other brands, reported net sales decreased 8% from $2.09 billion in Q4 2020 to $1.92 billion in the three months ending April 30, 2021, according to an earnings report.

Net sales excluding divestitures and foreign currency exchange decreased 3%, driven by lapping consumer stock-up purchasing resulting from the COVID-19 pandemic in the prior year, partially offset by continued elevated at-home consumption.

Operating income fell 31% from $346.7 million in Q4 2020 to $238.7 million in Q4 2021, while adjusted operating income declined 28% from $431.2 million to $311.6 million in the comparative quarters.

Net income per diluted share fell 26% from $1.89 in Q4 2020 to $1.35 in Q4 2021.

Net sales for the U.S. retail coffee segment increased $1.5 million, as volume/mix increases for the Dunkin and Café Bustelo brands were offset by a decline for the Folgers brand.

Profit for U.S. retail coffee decreased $16.4 million, primarily due to a $12.9 million increase in marketing investments.

For the full year, net sales were $8 billion, an increase of 3%. Net sales excluding divestitures and foreign currency exchange increased 5% percent.

For the full year, net income per diluted share was $7.79 while adjusted earnings per share was $9.12, an increase of 4%.

The $1.92 billion in Q4 2021 revenue beat analyst expectations by $40 million while the Non-GAAP EPS of $1.89 beat expectations by 23 cents and the GAAP EPS of $1.35 missed expectations by 24 cents, according to Seeking Alpha.

Shares traded at $138.52 today against a 52-week range of $98.89-$139.24.

"Our strong financial results reflect sustained elevated demand for at-home food and coffee consumption and consumers' desire for our trusted and iconic brands," Mark Smucker, president and CEO, said in the press release.

The company provided its fiscal 2022 outlook, with an expected net sales decrease of 2% to 3%, adjusted earnings per share to range from $8.70 to $9.10, and free cash flow of $900 million.

For the year ending April 30, 2022, the company projects net income per common share between $6.55 and $6.95, and adjusted earnings per share between $8.70 to $9.10.

For an update on how the coronavirus pandemic has affected convenience services, click here.