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J. M. Smucker Announces First Quarter Results

ORRVILLE, Ohio, Aug. 18 /PRNewswire/ -- The J. M. Smucker Company, Orrville, Ohio (NYSE: SJM.A, SJM.B), announced today that earnings for the first quarter ending July 31, 1999, were $11,037,000, up 6 percent over earnings of $10,416,000 for the same period last year. Sales for the three- month period were up approximately 7 percent to $161,495,000 from $150,500,000 in the prior year first quarter. On a diluted basis, earnings per share were $.38 compared to $.36 per share last year.

The Company reported that all of its domestic segment businesses realized sales increases over the prior year, with the largest dollar growth occurring in the consumer and foodservice markets. In the consumer area, the continued rollout of Smucker's Snackers, introduced during last fiscal year, and the inclusion of the Adams natural peanut butter business, acquired in December 1998, were key causes for the increase. In the foodservice area, the Company stated that the increase in sales was attributable to a combination of volume growth in the portion control segment and the impact of the recent agreement with Lea & Perrins, Inc., pursuant to which the Company now is distributing Lea & Perrins products to the foodservice industry. In the international segment, all geographic markets realized sales increases, with the majority of the growth occurring in the Company's Greater Europe market and in Australia.

The Company stated that the increase in quarterly earnings was attributable to the growth in sales, offset by higher selling and administrative expenses. Interest expense also increased significantly over the prior year due to the Company's long-term debt placement, which was completed during the first quarter. The Company added that earnings were also favorably impacted by a decrease in the Company's effective tax rate for the quarter.

The Company also announced that its Board of Directors has increased the Company's share repurchase authorization by an additional one million shares (Class A and Class B combined). The increase provides the Company with a total repurchase authority of approximately 1,500,000 shares. According to a Company spokesman, the Board and management believe that the Company is very well positioned for future growth and that the repurchase of the Company's shares therefore represents an attractive investment alternative at current prices. The spokesman also noted that management intends to continue its practice of buying periodically on the open market and has not set a specific time frame within which repurchases will occur.

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,
                                                 1999               1998
                                                 (Dollars in thousands,
                                                  except per share data)

    Net sales                                  $161,495           $150,500
    Cost of products sold                       103,467             96,638
    Gross profit                                 58,028             53,862
    Selling, distribution, and administrative
      expenses                                   40,795             37,342
    Operating income                             17,233             16,520

    Interest income                                 723                625
    Interest expense                               (480)                (4)
    Other income -- net                             367                295
    Income before income taxes                   17,843             17,436
    Income taxes                                  6,806              7,020
    Net income                                  $11,037            $10,416

    Net income per Common Share                   $0.38              $0.36
    Net income per Common Share -- Assuming
      Dilution                                    $0.38              $0.36

    Dividends declared per share:
    Class A                                       $0.15              $0.14
    Class B                                       $0.15              $0.14

    Common Shares outstanding                29,047,531         29,026,846
    Common Shares outstanding -- assuming
      dilution                               29,178,059         29,332,437

                          The J. M. Smucker Company

                                                          July 31,
                                                   1999               1998
                                                    (Dollars in thousands)
    Current Assets:
      Cash and cash equivalents                   $52,454             $7,052
      Trade receivables                            58,178             46,276
      Inventories                                 141,636            137,642
      Other current assets                         14,375             12,632
          Total Current Assets                    266,643            203,602

    Property, Plant & Equipment, Net              170,544            153,414

    Noncurrent Assets                              79,907             64,554
        Total                                    $517,094           $421,570

    Current Liabilities:
      Accounts payable                            $57,634            $46,379
      Other current liabilities                    37,737             48,222
          Total Current Liabilities                95,371             94,601

    Long-term Debt                                 75,000                 --
    Other Noncurrent Liabilities                   21,776             21,024
    Shareholders' Equity, Net                     324,947            305,945
        Total                                    $517,094           $421,570
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