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J. M. Smucker Announces Year-End Results

ORRVILLE, Ohio, June 17 /PRNewswire/ -- The J. M. Smucker Company, (NYSE: SJM.A and SJM.B), today announced its financial results for the year ended April 30, 1999. Sales for the year were $602,457,000, up 6.5% over fiscal 1998 sales of $565,476,000. Earnings for the year increased approximately 4% to $37,763,000 or $1.30 per share. This compared to earnings of $36,348,000 or $1.25 per share last year, before the effect of an accounting change.

The Company also announced that sales in the fourth quarter were $156,291,000, up nearly 10% over the same period last year, while earnings for the period were $10,039,000, an increase of 3%. Earnings per share in the fourth quarter were $.35 compared to $.34 last year.

The Company reported sales increases in all areas of its business, with the majority of the growth occurring in the consumer, industrial, international, and foodservice markets. In consumer, the majority of the increase came in the traditional fruit spreads segment and from the impact of the introduction of Smucker's Snackers, the Company's convenient new shelf- stable peanut butter and jelly offering for lunches and snacks. The acquisition of the Adams natural peanut butter business in December 1998 also contributed. In the foodservice and industrial markets, sales from new products and new businesses contributed to the increase over fiscal 1998.

In international, the majority of the growth occurred in the Australasia market and was primarily due to the acquisition of the Allowrie brand of fruit spreads early in the fiscal year. Overall, acquisitions contributed approximately 10% to international sales for the year. Gains were also realized in Mexico where sales increased by nearly 50% over the prior year. The growth in international occurred despite the adverse effect of exchange rates on the results in Canada and Australia.

The Company stated that it was pleased with the increase in earnings, especially in view of investment spending during the year and higher than planned operational costs. The investment spending included costs associated with the rollout of Smucker's Snackers and the Company's consumer direct initiatives. The Company expressed optimism that the investments being made, including the ongoing investment in the upgrade of its information systems, would bring benefits and contribute to income improvements in the future.

The Company also announced today that it expects to complete the private placement of $75 million in senior long-term notes within the next several days. According to the Company, the notes will have a term of ten years, with interest payable semiannually and principle payable at the end of the term. The proceeds will be used for general corporate purposes, including retirement of current short-term borrowings, continuation of the Company's stock repurchase program, and acquisitions and other investments.

This release contains forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially. These risks and uncertainties are detailed from time to time in reports filed by the Company with the Securities and Exchange Commission, including forms 10-Q and 10-K.

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

                                                   Year Ended April 30,
                                                 1999               1998
                                                 (Dollars in thousands,
                                                  except per share data)

    Net sales                                 $ 602,457          $ 565,476
    Cost of products sold                       395,944            365,613
    Gross Profit                                206,513            199,863
    Selling, distribution, and
      administrative expenses                   147,538            142,799
    Operating Income                             58,975             57,064
    Interest income                               1,948              2,525
    Interest expense                               (179)              (145)
    Other income -- net                             887              1,315
    Income Before Income Taxes and Cumulative
      Effect of Change in Accounting Method      61,631             60,759
    Income taxes                                 23,868             24,411
    Income Before Cumulative Effect of
      Change in Accounting Method                37,763             36,348
    Cumulative effect of change in accounting
      method, net of tax benefit of $1,980           --             (2,958)
    Net Income                                  $37,763            $33,390

    Net income per Common Share:
    Income before cumulative effect of change
      in accounting method                        $1.30              $1.25
    Cumulative effect of change
      in accounting method                           --               (.10)
    Net income                                    $1.30              $1.15

    Net income per Common Share -- Assuming
    Income before cumulative effect of change
      in accounting method                        $1.29              $1.24
    Cumulative effect of change
      in accounting method                           --               (.10)
    Net income                                    $1.29              $1.14

    Dividends declared per share:
      Class A                                      $.57               $.53
      Class B                                      $.57               $.53

    Weighted-Average Shares Outstanding      29,057,593         29,038,723
    Weighted-Average Shares
      Outstanding -- Assuming Dilution       29,274,719         29,345,278

                          The J. M. Smucker Company

                                                         April 30,
                                                  1999              1998
                                                  (Dollars in thousands)
    Current Assets:
      Cash and cash equivalents                  $8,683            $36,484
      Trade receivables                          51,858             48,732
      Inventories                               114,200            103,465
      Other current assets                       11,401             12,825
        Total Current Assets                    186,142            201,506

    Property, Plant & Equipment, Net            166,543            143,714

    Other Noncurrent Assets                      81,198             62,753
      Total                                   $ 433,883          $ 407,973

    Current Liabilities:
      Accounts payable                          $40,262            $41,410
      Notes payable                               8,966                 --
      Other current liabilities                  38,403             43,490
        Total Current Liabilities                87,631             84,900

    Noncurrent Liabilities                       21,923             20,896
    Shareholders' Equity, Net                   324,329            302,177
      Total                                   $ 433,883          $ 407,973

                          The J. M. Smucker Company

    The following is a summary of unaudited quarterly results of operations
for the years ended April 30, 1999 and 1998.

    (Dollars in thousands, except per share data)

                                                         Effect of
             Quarter              Net       Gross        Accounting     Net
              Ended              Sales      Profit         Change     Income
    1999    July 31            $150,500    $53,862        $10,416    $10,416
            October 31          154,894     51,690          9,063      9,063
            January 31          140,772     49,055          8,245      8,245
            April 30            156,291     51,906         10,039     10,039

    1998    July 31            $147,389    $51,396         $9,973     $9,973
            October 31          145,187     49,213          8,602      8,602
            January 31          130,658     47,232          8,033      5,075
            April 30            142,242     52,022          9,740      9,740

                                    Net Income per       Net Income per Common
                                     Common Share          Share -- Assuming

                                   Income                   Income
                                   Before                   Before
                                 Cumulative               Cumulative
                                  Effect of                Effect of
            Quarter              Accounting     Net       Accounting     Net
             Ended                 Change      Income       Change      Income
    1999    July 31                $0.36       $0.36        $0.36       $0.36
            October 31              0.31        0.31         0.31        0.31
            January 31              0.28        0.28         0.28        0.28
            April 30                0.35        0.35         0.34        0.34

    1998    July 31                $0.34       $0.34        $0.34       $0.34
            October 31              0.30        0.30         0.29        0.29
            January 31              0.27        0.17         0.27        0.17
            April 30                0.34        0.34         0.33        0.33

Annual earnings per share may not equal the sum of the individual quarters due to differences in the average number of shares outstanding during the respective periods.

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