J.M. Smucker (NYSE:SJM), the maker of Jif peanut butter and Smucker's jams, reported lower-than-expected earnings in its fiscal fourth quarter, hurt by weak demand for its Folgers and Dunkin' Donuts packaged coffee.
Net loss was $90.3 million, or $0.82 per share, for the quarter ended April 30, compared with a profit of $118.5 million, or $1.16 per share, the Orrville, Ohio-based company said in a statement today.
Excluding items, the company earned $0.98 per share, missing the $0.99 average estimate of 15 analysts polled by Capital IQ.
Net sales rose 17 percent to $1.45 billion, topping the Wall Street consensus of $1.36 billion.
By geography, U.S. retail coffee sales edged down 1 percent to $468.6 million in the fourth quarter, the 10th straight quarter of decline, as demand was weak for its Folgers and Dunkin' Donuts packaged coffee. The business accounted for about a third of Smucker's sales.
U.S. retail consumer foods sales decreased 8 percent to $427.5 million from the year-ago quarter.
Shares dropped 4 percent to $113.47 at 2:18 p.m. in New York, paring this year’s gains to 12 percent.
International, foodservice, and natural foods sales grew 6 percent to $311.9 million from last year. The new U.S. retail pet foods division (Big Heart) generated sales of $239.1 million.
“While these results were significantly impacted by the challenges in our U.S. Retail Coffee segment, we are optimistic about our current initiatives and confident in the long-term prospects of our coffee business," chief executive officer Richard Smucker said.
Smucker and other coffee makers raised prices last year after a drought in top coffee producer Brazil hurt output. The company has called the price hike a "misstep".
The company provided weak full year guidance of between $5.65 and $5.80 per share, short of analysts' $5.84 per share expectations.