Food products maker J.M. Smucker Co. (SJM) posted an increase in its earnings for the fourth quarter, reflecting higher margins, despite a slight decline in net sales.
The company's net income rose to $130.3 million from $104.1 million, while earnings per share increased to $1.22 a share from $0.93 a share last year.
For the quarter, earnings per share before special project costs totaled $1.29. On average, 14 analysts polled by Thomson Reuters expected earnings per share of $1.15 for the quarter. Analysts' estimates typically exclude one-time items.
Net sales for the quarter slid 1 percent to $1.339 billion from last year's $1.355 billion, primarily due to a 5 percent decrease in net price realization reflecting price declines taken earlier in fiscal 2013, notably on coffee and peanut butter. Analysts expected revenues of $1.34 billion for the quarter.
The company's gross margin rose to 35.8 percent from 33.2 percent, while operating margin too increased to 16 percent from 13.7 percent last year.
J. M. Smucker said its results include the operations of the North American foodservice coffee and hot beverage business acquired from Sara Lee since the completion of the acquisition on January 3, 2012.
For fiscal 2014, the Company expects non-GAAP earnings per share in the range of $5.65 - $5.75, which excludes special project costs of about $0.20 per share and net sales to be comparable to 2013 reflecting the full-year impact of price declines taken in 2013 and rationalization of previously discussed products, offset by net sales of Cumberland products and expected volume growth in key categories. The Street is looking for earnings per share of $5.73 for the year.
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