Page 1

Investor Relations | The J.M. Smucker Company The J.M. Smucker Co. Announces Fiscal 2022 First Quarter Results ORRVILLE , Ohio , Aug. 26 , 2021 / PRNewswire / -- The J.M. Smucker Co. ( NYSE : SJM ) today announced results for the first quarter ended July 31 , 2021 , of its 2022 fiscal year . Financial results for the first quarter of fiscal year 2022 reflect the divestiture of the CriscoⓇ business on December 1 , 2020 , and the divestiture of the Natural Balance® business on January 29 , 2021. All comparisons are to the first quarter of the prior fiscal year , unless otherwise noted . EXECUTIVE SUMMARY • Net sales decreased $ 113.8 million , or 6 percent . Net sales excluding divestitures and foreign currency exchange increased 1 percent . • Net income per diluted share was $ 1.42 . Adjusted earnings per share was $ 1.90 , a decrease of 20 percent . • Cash from operations was $ 137.8 million , a decrease of 66 percent . Free cash flow was $ 69.8 million , compared to $ 332.4 million in the prior year . • The Company updated its full - year fiscal 2022 financial outlook . CHIEF EXECUTIVE OFFICER REMARKS " Our first quarter results reflected organic net sales growth , while lapping double - digit growth in the prior year , and continued to demonstrate consumers ' desire for our brands , while earnings were in line with our expectations , " said Mark Smucker , President and Chief Executive Officer . " The progress we have made against our strategy and executional priorities has made us a stronger company , positioning our iconic brands for continued growth in market share . " " Our industry continues to navigate a period of significant supply chain volatility , disruption , and cost inflation . In the near term , we expect to experience higher raw material and logistics cost increases . However , we are optimistic in managing these challenges and remain confident in the momentum of our business , the talent and commitment of our people , and our strengthened financial position to deliver balanced top- and bottom - line growth and long - term shareholder value . " FIRST QUARTER CONSOLIDATED RESULTS Net sales Operating income Adjusted operating income Net income per common share - assuming dilution Adjusted earnings per share - assuming dilution Weighted - average shares outstanding - assuming dilution Net Sales Three Months Ended July 31 , 2021 % Increase 2020 ( Decrease ) ( Dollars and shares in millions , except per share data ) ( 6 ) % $ 1,971.8 $ 1,858.0 $ 259.4 323.4 $ 1.42 1.90 108.4 $ 361.1 404.5 $ 2.08 2.37 114.1 ( 28 ) % ( 20 ) % ( 32 ) % ( 20 ) % ( 5 ) % Net sales decreased 6 percent . Excluding noncomparable net sales of $ 135.5 million for the divested Crisco® and Natural Balance® businesses , as well as $ 10.4 million of favorable foreign currency exchange , net sales increased $ 11.3 million , or 1 percent . The increase in comparable net sales was primarily due to favorable volume / mix for the Company's Away From Home operating segment and U.S. Retail Pet Foods segment , partially offset by reduced volume / mix for its International operating segment and U.S. Retail Coffee segment . Net price realization was a slight benefit , primarily reflecting higher net pricing in the U.S. Retail Consumer Foods segment , mostly offset by lower net pricing in the U.S. Retail Coffee segment . Operating Income Gross profit decreased $ 136.0 million , or 18 percent , reflecting higher costs , primarily driven by increased commodity and transportation costs , the noncomparable impact of the Crisco® and Natural Balance® divestitures , and a decreased contribution from volume / mix . Operating income decreased $ 101.7 million , or 28 percent , primarily driven by the decrease in gross profit , partially offset by a $ 33.5 million decrease in selling , distribution , and administrative ( " SD & A " ) expenses , primarily attributable to decreased marketing expense . Adjusted gross profit decreased $ 113.0 million , or 15 percent , with the difference from generally accepted accounting principles ( " GAAP " ) results being the exclusion of the change in net cumulative unallocated derivative gains and losses and special project costs . Adjusted operating income decreased $ 81.1 million , or 20 percent , further reflecting the exclusion of amortization and other special project costs . Interest Expense , Other Income ( Expense ) , and Income Taxes Net interest expense decreased $ 3.0 million , primarily as a result of reduced debt outstanding as compared to the prior year .