The J.M. Smucker Co. (NYSE: SJM) spooned out some healthy numbers for their first quarter 2008 ending July 31st. Benefiting, no doubt, from the disappearance of competing peanut butter brand Peter Pan from store shelves after it was found contaminated with salmonella, Smucker's brand Jif was one of the leading contributors in bringing home net income of $40.8 million, or $0.71 per share, well above analyst estimates of $0.65. The earnings were 42% above 2007 same quarter.Almost half of the earnings, however, came from the recently-acquired Eagle brand businesses, on a volume of $43.5 million. Other Smuckers brands showing strong performance for the quarter were Crisco, Pillsbury and Uncrustables.
The results suggest the company is on track to continue its growth, up to $157 million on sales of $2.1 billion in 2007 and up 70% in shareholder return since 2002.
Looking forward, the company may find the Eagle brands impacted by sharply rising milk prices, and since approximately 20% of Smucker's sales are to Wal-Mart, that company's fortunes can affect Smucker's bottom line. Also, Peter Pan is resuming sales after a six-month hiatus, which could impact sales.
Nonetheless, with a strong stable of American staples and consistent recent success, Smucker is worth a look in a tumultuous market.
For a quick-read on the U.S. economy, check the price of gasoline
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