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(Sharecast News) - Shares in The JM Smucker Company sweetened on Tuesday, after the American jam-to-coffee food group posted above-forecast quarterly earnings.
The 129-year-old business - which owns Folger coffee, Jif peanut butter, Twinkie-maker Hostess and Meow Mix cat food, among others - saw net sales rise 6% in the three months to 30 April to $2.3bn, while adjusted earnings per share jumped 20% to $2.77. Wall Street had expected fourth-quarter EPS closer to $2.64.
A 10 percentage point rise in prices helped offset a dip in volumes during the quarter.
Across the year as a whole, net sales rose 4% to $9.1bn, while adjusted EPS slid 10% to $9.15.
Chief executive Mark Smucker - the great, great grandson of the founder - said: "We delivered positive net sales and earnings growth in the quarter, while navigating a dynamic external environment, and we are entering fiscal 2027 with meaningful momentum."
Packaged food companies such as JM Smucker are facing various headwinds, including weaker consumer spending, a preference for cheaper own label brands, growing demand for healthier foods and the rapid adoption of GLP-1 weight loss drugs, which suppress the appetite.
Looking to the current year, and JM Smucker acknowledged that conditions continued to be "dynamic and evolving", with geopolitical, macroeconomic and policy changes, as well as changes in consumer behaviours, all potentially impacting trading.
It forecast net sales to fall by between 3% and 4%, primarily due to lower net price realisation as well as a decline in volume/mix. Adjusted EPS was forecast to come in between $9.75 and $10.25. However, the EPS forecast was better than Wall Street forecasts for around $9.79 .
Smucker said: "Our strategic priorities for the fiscal year are to drive focused organic volume growth across our key platforms, improve profitability and accelerate earnings growth, and maintain a disciplined approach to capital deployment. Our strategy is working."
As at 1400 BST, the stock had put on 4% in pre-market trading.