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J. M. Smucker Announces Third Quarter Results

ORRVILLE, Ohio, Feb. 17 /PRNewswire/ -- The J. M. Smucker Company, (NYSE: SJM.A and SJM.B), announced today that sales for the third quarter were $140,772,000, up approximately 8% over $130,658,000 last year. Earnings for the period increased approximately 3% to $8,245,000 or $.28 per share. This compared to earnings of $8,033,000 or $.27 per share last year, before the effect of an accounting change which reduced prior year's net income to $5,075,000 or $.17 per share.

The Company also announced that sales for the first nine months of the fiscal year were $446,166,000 compared to $423,234,000 last year, an increase of over 5%. Earnings for the same period were up 4% (prior to the accounting change referred to above). Earnings per share for the first nine months were $.95 compared to $.91 for the same period last year.

The Company reported sales increases in all areas of its business. The international area showed strong growth, with all of its markets reporting increases over the prior year. The majority of the international growth occurred in the Australasia market, where acquisitions made a significant contribution. The growth in international occurred despite the continued adverse effect of exchange rates on the results in Australia and Canada.

In the consumer area, the majority of the increase came in the traditional fruit spreads segment and from the impact of the introduction earlier this year of Smucker's Snackers, the Company's convenient new shelf-stable peanut butter and jelly offering for lunches and snacks. The Company also noted that its market position in the core fruit spreads, toppings, and peanut butter categories remains strong with share of market growing in each area.

The Company reported that the increase in quarterly earnings was attributable primarily to the growth in sales and to a decrease in administrative expenses, offset by increases in the cost of selected fruits and in distribution costs. Earnings also were impacted by increases from the prior year in marketing expenses, interest costs, and income taxes.

The J. M. Smucker Company (http://www.smucker.com) 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      Nine Months Ended
                                    January 31,            January 31,
                                 1999        1998        1999        1998
                               (Dollars in thousands, except per share data)

    Net sales                  $140,772    $130,658     $446,166   $423,234
    Cost of products sold        91,717      83,426      291,559    275,393
    Gross profit                 49,055      47,232      154,607    147,841
    Selling, distribution,
      and administrative
      expenses                   35,465      35,005      110,185    105,741
    Operating income             13,590      12,227       44,422     42,100

    Interest income                 370         552        1,433      1,732
    Interest expense               (252)        (30)        (512)      (120)
    Other income - net               97         412          583        712
    Income before income taxes
      and cumulative effect of
      change in accounting
      method                     13,805      13,161       45,926     44,424
    Income taxes                  5,560       5,128       18,202     17,816
    Income before cumulative
      effect of change in
      accounting method           8,245       8,033       27,724     26,608
    Cumulative effect of change
      in accounting method           --      (2,958)          --     (2,958)
    Net income                   $8,245      $5,075      $27,724    $23,650

    Earnings per Common Share:
      Income before cumulative
        effect of accounting
        change                     $.28        $.27         $.95       $.91
      Cumulative effect of
        accounting change            --        (.10)          --       (.10)
      Net Income per Common Share  $.28        $.17         $.95       $.81

    Earnings per Common Share
    - Assuming Dilution:
      Income before cumulative
        effect of accounting
        change                     $.28        $.27         $.95       $.91
      Cumulative effect of
        accounting change            --        (.10)          --       (.10)
      Net Income per Common Share
        -- Assuming Dilution       $.28        $.17         $.95       $.81

    Dividends declared per share:
      Class A                      $.14        $.13         $.42       $.39
      Class B                      $.14        $.13         $.42       $.39

    Common Shares
      outstanding            29,071,579  29,034,886   29,047,187 29,039,548
    Common Shares
      outstanding --
      assuming dilution      29,294,068  29,382,091   29,286,151 29,318,864

                          The J. M. Smucker Company
                    CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (Unaudited)

                                              January 31,
                                           1999        1998
                                         (Dollars in thousands)
    ASSETS
    Current Assets:
      Cash and cash equivalents           $5,824      $24,836
      Trade receivables                   49,841       42,238
      Inventories                        125,918      109,126
      Other current assets                12,127        9,404
         Total Current Assets            193,710      185,604

    Property, Plant & Equipment, Net     164,113      141,048

    Noncurrent Assets                     76,285       63,476
         Total                          $434,108     $390,128

    LIABILITIES & SHAREHOLDERS' EQUITY
    Current Liabilities:
      Accounts payable                   $33,419      $26,991
      Notes payable                       26,712           --
      Other current liabilities           37,375       42,523
         Total Current Liabilities        97,506       69,514

    Other Noncurrent Liabilities          21,186       21,733
    Shareholders' Equity, Net            315,416      298,881
         Total                          $434,108     $390,128
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