The power of strong branding proved itself once again in the last quarter as J.M. Smucker Co. was able to set higher prices for its products and increase sales in this time of inflation. Adriano Marchese reports for The Wall Street Journal:
Food manufacturer J.M. Smucker Co. SJM -1.34% said sales in the second quarter rose, as higher prices and demand helped it navigate higher costs and supply chain challenges.
On Tuesday, the company behind Jif peanut butter, its namesake jellies and Folgers coffee said net sales were $2.05 billion in its fiscal second quarter, up from $2.03 billion a year earlier. Analysts polled by FactSet expected $1.95 billion.
When adjusted for divestitures and for currency exchange, sales rose 8%.
Higher prices in manufacturing, transportation, ingredient and packaging costs continued to weigh on gross margin in the period, falling to 34.7% from 40.2% a year earlier.
Smucker said in August it would raise prices further to combat cost inflation and prolonged supply disruptions. Weather in places like Brazil, Texas and the Pacific Northwest also drove up costs for commodities and other inputs.
It said it planned to pass the higher costs through to consumers, raising prices on coffee and other products.
“We delivered robust, organic top-line growth across each of our segments, reflecting consumers’ continued desire for our brands and the successful implementation of initial pricing actions,” Chief Executive and President Mark Smucker said in prepared remarks Tuesday.
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