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J.M. Smucker Announces First Quarter Results

ORRVILLE, Ohio, Aug. 19 /PRNewswire/ -- The J.M. Smucker Company, (NYSE: SJM.A and SJM.B), announced today that earnings for the first quarter ending July 31, 1998, were $10,416,000 up 4% percent over earnings of $9,973,000 for the same period last year. Sales for the three-month period were up approximately 2 percent, to $150,500,000 from $147,389,000 in the prior year first quarter. On a diluted basis, earnings per share were $.36 compared to $.34 per share last year.

The Company reported sales increases in its consumer, industrial, foodservice, and beverages business areas, with the majority of the increase occurring in consumer and industrial. The Company attributed the growth in the consumer area to an increase in fruit spread sales in the grocery market and to the launch of Smucker's Snackers, the Company's convenient new shelf- stable peanut butter and jelly offering for lunches and snacks. In the industrial area, the sales growth came in the bakery, yogurt filling, and frozen dairy categories from a combination of both new and existing products.

In international, the Company reported that sales continued to be adversely impacted by the strength of the American dollar versus the Australian and Canadian currencies. As a result, the international area reported sales for the quarter that were slightly behind those of the prior year, despite strong gains for the Australian business when measured in its domestic currency.

The Company reported that the increase in earnings resulted primarily from a combination of sales growth and a decrease in administrative expenses, offset by an increase in marketing expenditures. According to the Company, the increase in marketing represented investment spending for several new product initiatives, including Smucker's Snackers, along with additional support for the fruit spreads business. The Company also noted that it expects marketing support to continue at a higher level through the remainder of the fiscal year.

The J.M. Smucker Company is the nation's leading producer of branded preserves, jams, jellies, and other fruit spread products, health and natural foods beverages, ice cream toppings, and natural peanut butter.

                          THE J. M. SMUCKER COMPANY

                                             Three Months Ended
                                                   July 31,
                                             1998          1997
                                            (Dollars in thousands,
                                             except per share data)

    Net sales                               $150,500      $147,389
    Cost of products sold                     96,638        95,993
    Gross profit                              53,862        51,396
    Selling, distribution, and
      administrative expenses                 37,342        35,390
    Operating income                          16,520        16,006

    Interest income                              625           698
    Interest expense                              (4)           (5)
    Other income (expense) - net                 295           126
    Income before income taxes                17,436        16,825
    Income taxes                               7,020         6,852
    Net income                               $10,416        $9,973

    Net income per Common Share                $0.36         $0.34
    Net income per Common Share
      - Assuming Dilution                      $0.36         $0.34

    Dividends declared per share:
      Class A                                  $0.14         $0.13
      Class B                                  $0.14         $0.13

    Common Shares outstanding             29,026,846    29,074,445
    Common Shares outstanding
      - assuming dilution                 29,332,437    29,195,258

                          The J. M. Smucker Company

                                                    July 31,
                                              1998          1997
                                            (Dollars in thousands)
    Current Assets:
      Cash and cash equivalents              $7,052        $14,954
      Trade receivables                      46,276         51,417
      Inventories                           137,642        115,347
      Other current assets                   12,632         10,660
        Total Current Assets                203,602        192,378

    Property, Plant & Equipment, Net        153,414        144,822

    Noncurrent Assets                        64,554         66,733
        Total                              $421,570       $403,933

    Current Liabilities:
      Accounts payable                      $46,379        $46,899
      Other current liabilities              48,222         41,605
        Total Current Liabilities            94,601         88,504

    Other Noncurrent Liabilities             21,024         21,260
    Shareholders' Equity, Net               305,945        294,169
        Total                              $421,570       $403,933
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