ORRVILLE, OHIO — Favorable product volume and mix fared well for The J.M. Smucker Company’s retail pet food segment in its first quarter of fiscal 2021, reporting $692.6 million in sales, up 3% from year-ago revenue.

The company reported growth for its 9Lives, Meow Mix and Milk-Bone brands, offset by declines for Natural Balance, Nature’s Recipe and private label dog food brands. Mark Smucker, president and chief executive officer, said the segment performed “slightly better than expected” in an earnings conference call Aug. 25.

Cat food and treat product sales grew 13% and dog treats grew 9%, according to Tucker Marshall, chief financial officer.

“While still relatively small, cat snacks increased over 20% driven by the Nutrish brand,” Marshall said. “Dog food sales decreased mid-single digits, driven by declines for the Natural Balance and Nature's Recipe brands and private label dog food, slightly offset by growth for the Kibbles 'n Bits brand.”

Lower pricing of Nutrish dog food products also resulted in a slight sales decline for the brand.

Segment operating profit for pet food and snacks increased 4% to $5.2 million over the quarter, driven in part by lower manufacturing costs, according to Smucker’s.

“We continue to take actions to improve our competitive positioning in the dog food category, primarily for our premium brands,” Smucker said.

Pet food remains the company’s largest product segment in terms of net sales, but comes in third in terms of operating profit behind Smucker’s retail coffee and retail consumer foods businesses.

Overall, the company reported net sales of $1.97 billion, up 11% from year-ago sales of $1.78 billion. Smucker's net income in the first quarter ended July 31 was $237 million, or $2.08 per share on the common stock, up 53% from $154.6 million, or $1.36 per share, in the first quarter of fiscal 2021. Adjusted earnings per share in the quarter were up 50% from the previous year.

"Our first quarter results exceeded our expectations, particularly for the coffee and consumer foods portfolios,” Smucker said. “Consumers continued to seek out trusted and iconic brands as we achieved strong growth across nearly all our categories. This exceptional performance highlights the strength of our portfolio, the potential of our consumer-centric growth strategy, and our commitment to operate with financial discipline."

Following the release of its first quarter earnings, Smucker’s has increased its guidance for the full fiscal year. Previously, the company expected net sales to be down 1% to 2%, but now expects 0% to 1% sales growth. Adjusted earnings-per-share (EPS) projections were upgraded to between $8.20 and $8.60, up $0.30. Free cash flow expectations were also boosted by $25 million and now sit between $925 million and $975 million. Capital expenditures remain at an estimated $300 million for the year.

"We expect continued momentum in the second quarter and are pleased to raise our full-year guidance,” Smucker said. “We remain confident in our ability to deliver on our fiscal year 2021 goals, advance our long-term strategy, and deliver increased shareholder value."

Read on about Smucker’s fourth quarter 2020 earnings, reported in June.

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