Food Products Maker J M Smucker's Q1: EPS Beat, Volume Growth, Revised Outlook & More

J.M. Smucker Company SJM reported a first-quarter FY24 sales decline of 4% year-on-year to $1.805 billion, missing the analyst consensus of $1.84 billion.

Adjusted EPS of $2.21 beat the consensus estimate of $2.04.

Gross profit increased 19% Y/Y to $654.8 million and the gross profit margin expanded by 680 basis points to 36.3%.

The company’s operating income increased 69% to $303.5 million, with the margin expanding from 9.6% to 16.8%.

The company held $241.1 million in cash and equivalents as of July 31, 2023. Operating cash flow for the quarter totaled $217.9 million, and the free cash flow was $67.6 million.

The company repurchased approximately 2.4 million of its common shares for $372 million in Q1.

Outlook: J M Smucker raised FY24 adjusted EPS guidance from $9.20 - $9.60 to $9.45 - $9.85 versus the consensus of $9.39.

The company continues to see FY24 comparable net sales growth of 8.5% to 9.5%.

Net sales are expected to decrease 10.0%- 11.0% compared to the prior year, reflecting $1.5 billion of net sales related to the divested pet food brands in the prior year.

Price Action: SJM shares are trading higher by 1.83% at $145.51 on the last check Tuesday.