Aug 27 (Reuters) - Folgers coffee maker J.M. Smucker
missed Wall Street estimates for first-quarter profit on
Wednesday, hurt by a rise in commodity costs as U.S. tariffs
weighed.
Higher inflation has prompted packaged food companies such
as J.M. Smucker and Conagra Brands ( CAG ) to raise product
prices in a bid to offset elevated input costs, which have
worsened due to tariff-led expenses since the start of the year.
The rise in prices has led to weaker product demand for J.M.
Smucker, whose shares fell about 7% following the results.
The company, which imports green coffee majorly from Brazil
and Vietnam, had warned in June that the commodity's heavy
exposure to tariffs would hurt its profitability.
The Jif peanut butter maker buys about 500 million pounds of
green coffee each year and could face the brunt of 50% tariffs
on Brazilian imports, which were raised in July from a prior
level of 10%.
J.M. Smucker's cost of products sold in the three months
ended July 31 rose 23% to $1.64 billion, leading a quarterly
loss of $43.9 million on a GAAP basis.
The company posted adjusted profit of $1.90 per share for
the first quarter, missing analysts' average estimate of $1.93
per share, according to data compiled by LSEG. It had reported a
profit of $185 million a year ago.
However, J.M. Smucker raised its annual net sales growth
forecast to a range of 3% to 5%, up from a prior view of 2% to
4%.