ORRVILLE, Ohio, Nov. 19 /PRNewswire/ -- The J. M. Smucker Company, (NYSE: SJM.A and SJM.B), announced today that earnings for the second quarter ending October 31, 1998, were $9,063,000, up 5% over earnings of $8,602,000 for the same period last year. Sales for the three-month period were up approximately 7%, to $154,894,000 from $145,187,000 in the prior year second quarter. On a diluted basis, earnings per share were $.31 compared to $.29 per share last year.
The Company also announced that sales for the first six months of the fiscal year were $305,394,000 compared to $292,576,000 last year, an increase of over 4%, while earnings for the same period were up 5%. Diluted earnings per share for the first six months were $.67 compared to $.63 for the same period last year.
The Company reported sales increases in all of its business areas, with the majority of the increase occurring in the consumer, industrial, beverage, and international areas. The Company attributed the majority of the increase in the consumer area to increased sales of fruit spreads and to the launch of Smucker's Snackers, the Company's convenient new shelf-stable peanut butter and jelly offering for lunches and snacks. According to the Company, natural peanut butter sales also were up nicely over the prior year. In the industrial area, the growth came primarily from the sales of ingredients for new products of bakery and dairy customers. In beverages, growth in R. W. Knudsen Family brand products and the addition of sales from the recently acquired Mrs. Wiggles Rocket Juice beverage line accounted for the majority of that area's increase.
In international, the Company realized sales growth, due in part to the effect of acquisitions made in the last year, despite the fact that reported sales continued to be adversely impacted by the strength of the American dollar versus the Australian and Canadian currencies.
The Company reported that its increase in earnings resulted primarily from the growth in sales, offset by increases in distribution and certain operations support costs. Margins also were impacted by investment spending to support marketing initiatives (including the introduction of Smucker's Snackers) and the Company's information technology project. Marketing expenses, although up for the six-month period over the same period last year, increased at a lesser rate than sales during the second quarter.
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 STATEMENTS OF CONSOLIDATED INCOME (Unaudited) Three Months Ended Six Months Ended October 31, October 31, 1998 1997 1998 1997 (Dollars in thousands, except per share data) Net sales $154,894 $145,187 $305,394 $292,576 Cost of products sold 103,204 95,974 199,842 191,967 Gross profit 51,690 49,213 105,552 100,609 Selling, distribution, and administrative expenses 37,378 35,346 74,720 70,736 Operating income 14,312 13,867 30,832 29,873 Interest income 438 482 1,063 1,180 Interest expense (256) (85) (260) (90) Other income (expense) - net 191 174 486 300 Income before income taxes 14,685 14,438 32,121 31,263 Income taxes 5,622 5,836 12,642 12,688 Net income $9,063 $8,602 $19,479 $18,575 Net income per Common Share $.31 $.30 $.67 $.64 Net income per Common Share - Assuming Dilution $.31 $.29 $.67 $.63 Dividends declared per share: Class A $.14 $.13 $.28 $.26 Class B $.14 $.13 $.28 $.26 Common Shares outstanding 29,043,137 29,009,200 29,034,992 29,041,879 Common Shares outstanding - assuming dilution 29,231,947 29,379,019 29,282,193 29,266,863 The J. M. Smucker Company CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) October 31, 1998 1997 (Dollars in thousands) ASSETS Current Assets: Cash and cash equivalents $ 5,129 $ 11,822 Trade receivables 53,606 53,293 Inventories 138,482 117,967 Other current assets 13,388 10,140 Total Current Assets 210,605 193,222 Property, Plant & Equipment, Net 160,858 146,876 Noncurrent Assets 62,920 65,568 Total $434,383 $405,666 LIABILITIES & SHAREHOLDERS' EQUITY Current Liabilities: Accounts payable $ 38,006 $ 37,338 Other current liabilities 64,485 49,687 Total Current Liabilities 102,491 87,025 Other Noncurrent Liabilities 21,052 21,477 Shareholders' Equity, Net 310,840 297,164 Total $434,383 $405,666