How J.M. Smucker is 'well-positioned' for growth, CEO explains

Tue, Feb 27, 2024, 10:51 AM

J.M. Smucker (SJM) reported third-quarter results beating estimates on both revenue and profit. Revenue of $2.23 billion topped forecasts of $2.22 billion, while adjusted EPS of $2.48 exceeded projections of $2.27. J.M. Smucker CEO Mark Smucker joins Yahoo Finance Live to discuss the company's future plans.

Smucker says the company has been on a journey of "totally reshaping" its business, noting its focus on broadening its portfolio. This emphasis has allowed Smucker to be "well-positioned" to attract diverse consumers, with offerings ranging from "affordable options all the way up to premium options."

Smucker points to success with their recent Hostess acquisition, which "reaches consumers who are looking for an indulgent occasion." He calls Hostess "a great brand" and says they plan to boost marketing and innovation. He also indicates J.M. Smucker is "laser-focused" on driving their popular Uncrustables business, which Smucker says meets "so many need states."

For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Editor's note: This article was written by Angel Smith

Video Transcript

SEANA SMITH: Shares of J.M. Smucker edging slightly lower this morning off just over 1% after reporting third quarter results that beat on both the top and bottom lines on the company. Also looking to maintain some of its momentum against a pressured consumer environment. Joining us now, we want to bring in Mark Smucker. He's the president and CEO of the James Smucker Company.

And we also have Yahoo Finance's, very own Brooke DiPalma, joining us here on set. Mark, it's great to have you overall it's a strong quarter here for J.M. Smucker, clearly that demand remains. A lot of that being tied to some of your frozen offerings as well as pet food. I'm curious what you can share just about some of the trends that you're seeing from the consumer.

And how it differs than what we saw 3 to 6 months ago.

MARK SMUCKER: Yeah. Sure. Thanks for having me. First of all, our portfolio is very strong. We've been on a journey for the last three years totally reshaping our business, divesting some assets and really focusing on those categories and brands which are going to drive growth. Obviously, recently added the hostess business through acquisition.

So whether it's pet snacks, cat food, coffee, uncrustables and now sweet baked snacks. Our portfolio is incredibly well positioned and our focus on our marketing and sales capabilities in just that blocking and tackling has really helped to drive this growth and give us confidence in the future growth.

The consumer as you highlighted in some cases is a little bit stressed but our portfolio is broad and we offer affordable options all the way up to premium options in each of those businesses.

- And as you look at hostess and you work towards finalizing that acquisition, you do plan to significantly increase marketing, you said that at cagny last week. Talk us through the pricing strategy for hostess and how this marketing will help gain new customers to the J.M. Smucker portfolio?

MARK SMUCKER: Yeah. First of all, hostess is a great brand. Obviously, it reaches consumers who are looking for an indulgent occasion during the day. It's-- the brand itself is very strong. Pricing is about where it needs to be. And we will step up marketing over time in that brand as well as continuing to keep that fast cycle innovation that hostess has been so good at.

BRAD SMITH: And Mark, whenever we think about this company and I'm so glad to see on the investor relations page by the way. Uncrustables getting the right shine that they deserve as that header photo because we know how good this strawberry Uncrustables are.

But that aside, the frozen category, particularly is always of interest, especially for consumers who are looking to add more shelf life to their purchases as a value hack as they're being more value conscious. Where do you identify even more perhaps opportunities within that arena?

MARK SMUCKER: We're laser focused on Uncrustables. We are now meeting demand. We are producing millions of sandwiches a day, we're about to in the next year open our third plant in Alabama to continue to meet the demand. So we are focusing first and foremost on peanut butter. And peanut butter and jelly peanut butter and honey.

And we'll be bringing new flavors and executions to bear. We have a reduced sugar option as well. So there's so much runway on Uncrustables because it meets so many need states whether that's the parent on the go, a lot of athletes consume the product. Students in universities and K through 12 schools. There's just a tremendous amount of upside for Uncrustables.

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