The J.M. Smucker Co. Announces Fiscal Year 2024 Fourth Quarter Results
EXECUTIVE SUMMARY
- Net sales for the quarter were
$2.2 billion , a decrease of$29.1 million , or 1 percent. Net sales for the quarter excluding the acquisition, divestitures, and foreign currency exchange increased 3 percent. - For the fiscal year, net sales were
$8.2 billion , a decrease of 4 percent. Net sales excluding the acquisition, divestitures, and foreign currency exchange increased 8 percent. - Net income per diluted share for the quarter was
$2.30 . Adjusted earnings per share was$2.66 , an increase of 1 percent. - For the fiscal year, net income per diluted share was
$7.13 . Adjusted earnings per share was$9.94 , an increase of 11 percent. - Cash provided by operations for the quarter was
$428.1 million compared to$443.8 million in the prior year. Free cash flow was$297.5 million for the quarter and$642.9 million for the fiscal year. - Return of cash to shareholders through dividends was
$112.0 million for the quarter and$437.5 million for the fiscal year. - The Company provided its fiscal year 2025 outlook, with net sales expected to increase 9.5 to 10.5 percent, adjusted earnings per share to range from
$9.80 to$10.20 , and free cash flow of$900.0 million .
CHIEF EXECUTIVE OFFICER REMARKS
"Our fourth quarter and full-year results underscore the strength of our business and the demand for our leading brands. Our focus on superior execution and disciplined cost management helped drive our strong results in a dynamic operating environment," said
"Looking ahead, fiscal year 2025 will be a year of investment in our brands, capabilities, and talented employees, who have been instrumental to our success. Our strategy is working and our priorities are clear: deliver our core business, successfully integrate the Hostess business, achieve our synergy aspirations, and advance our transformation and cost discipline activities. We are confident we are well-positioned to deliver long-term growth and increase shareholder value."
FOURTH QUARTER CONSOLIDATED RESULTS
|
Three Months Ended |
||||
|
2024 |
|
2023 |
|
% Increase |
|
(Dollars and shares in millions, except per share data) |
||||
|
|
|
|
|
|
Net sales |
|
|
|
|
(1) % |
|
|
|
|
|
|
Operating income (loss) |
|
|
( |
|
n/m |
Adjusted operating income |
461.6 |
|
408.2 |
|
13 % |
|
|
|
|
|
|
Net income (loss) per common share – assuming dilution |
|
|
( |
|
140 % |
Adjusted earnings per share – assuming dilution |
2.66 |
|
2.64 |
|
1 % |
|
|
|
|
|
|
Weighted-average shares outstanding – assuming dilution |
106.4 |
|
105.4 |
|
1 % |
Net sales decreased
The increase in comparable net sales reflects a 2 percentage point increase from higher net price realization, primarily for
Operating Income
Gross profit increased
Adjusted gross profit increased
Interest Expense and Income Taxes
Net interest expense increased
The effective income tax rate was 21.7 percent, compared to 11.5 percent in the prior year. The adjusted effective income tax rate was 23.2 percent, compared to 23.8 percent in the prior year. The current year effective income tax rate includes one-time impacts associated with the acquisition of Hostess Brands while the prior year effective income tax rate included the one-time tax impacts of the divestiture of certain pet food brands, both of which are excluded from the respective adjusted effective income tax rates.
Cash Flow and Debt
Cash provided by operating activities was
FULL-YEAR OUTLOOK
The Company provided its full-year fiscal year 2025 guidance as summarized below:
Net sales increase vs prior year |
|
9.5% to 10.5% |
Adjusted earnings per share |
|
|
Free cash flow (in millions) |
|
|
Capital expenditures (in millions) |
|
|
Adjusted effective tax rate |
|
24.4 % |
Net sales are expected to increase 9.5 to 10.5 percent, reflecting a full-year of net sales from the Hostess Brands acquisition, as well as favorable volume/mix and higher net price realization. Comparable net sales are expected to increase approximately 1.5 to 2.5 percent, which excludes noncomparable sales in the current year from the acquisition of Hostess Brands and noncomparable sales in the prior year related to the divestitures of the Sahale Snacks® business and the
Adjusted earnings per share is expected to range from
FOURTH QUARTER SEGMENT RESULTS
(Dollar amounts in the segment tables below are reported in millions.)
|
|
Net Sales |
|
Segment |
|
Segment |
FY24 Q4 Results |
|
|
|
|
|
31.6 % |
Increase (decrease) vs prior year |
|
(4) % |
|
5 % |
|
270bps |
Net sales decreased
Segment profit increased
|
|
Net Sales |
|
Segment |
|
Segment |
FY24 Q4 Results |
|
|
|
|
|
21.3 % |
Increase (decrease) vs prior year |
|
(1) % |
|
(7) % |
|
-150bps |
Net sales decreased
Segment profit decreased
|
|
Net Sales |
|
Segment |
|
Segment |
FY24 Q4 Results |
|
|
|
|
|
25.2 % |
Increase (decrease) vs prior year |
|
(42) % |
|
(22) % |
|
670bps |
Net sales decreased
Segment profit decreased
Sweet Baked Snacks
|
|
|
|
|
|
|
Net Sales |
|
Segment |
|
Segment |
FY24 Q4 Results |
|
|
|
|
|
|
|
|
|
|
20.8 % |
The segment contributed net sales of
International and Away From Home
|
|
Net Sales |
|
Segment |
|
Segment |
FY24 Q4 Results |
|
|
|
|
|
20.4 % |
Increase (decrease) vs prior year |
|
(1) % |
|
28 % |
|
470bps |
Net sales decreased
Segment profit increased
Financial Results Discussion and Webcast
At approximately
This press release contains forward-looking statements, such as projected net sales, operating results, earnings, and cash flows that are subject to risks and uncertainties that could cause actual results to differ materially from future results expressed or implied by those forward-looking statements. The risks, uncertainties, important factors, and assumptions listed and discussed in this press release, which could cause actual results to differ materially from those expressed, include: the Company's ability to successfully integrate Hostess Brands' operations and employees and to implement plans and achieve financial forecasts with respect to the Hostess Brands' business; the Company's ability to realize the anticipated benefits, including synergies and cost savings, related to the Hostess Brands acquisition, including the possibility that the expected benefits will not be realized or will not be realized within the expected time period; disruption from the acquisition of Hostess Brands by diverting the attention of the Company's management and making it more difficult to maintain business and operational relationships; the negative effects of the acquisition of Hostess Brands on the market price of the Company's common shares; the amount of the costs, fees, expenses, and charges and the risk of litigation related to the acquisition of Hostess Brands; the effect of the acquisition of Hostess Brands on the Company's business relationships, operating results, ability to hire and retain key talent, and business generally; disruptions or inefficiencies in the Company's operations or supply chain, including any impact caused by product recalls, political instability, terrorism, geopolitical conflicts (including the ongoing conflict between
About
At
Unaudited Condensed Consolidated Statements of Income |
|||||||||||
|
|
|
|
||||||||
|
Three Months Ended |
|
Year Ended |
||||||||
|
2024 |
|
2023 |
|
% Increase |
|
2024 |
|
2023 |
|
% Increase |
|
(Dollars and shares in millions, except per share data) |
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
|
|
|
|
(1) % |
|
|
|
|
|
(4) % |
Cost of products sold |
1,292.4 |
|
1,442.4 |
|
(10) % |
|
5,063.3 |
|
5,727.4 |
|
(12) % |
Gross Profit |
913.3 |
|
792.4 |
|
15 % |
|
3,115.4 |
|
2,801.8 |
|
11 % |
Gross margin |
41.4 % |
|
35.5 % |
|
|
|
38.1 % |
|
32.8 % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, distribution, and administrative expenses |
424.9 |
|
376.0 |
|
13 % |
|
1,446.2 |
|
1,455.0 |
|
(1) % |
Amortization |
56.0 |
|
40.1 |
|
40 % |
|
191.1 |
|
206.9 |
|
(8) % |
Other special project costs |
24.5 |
|
2.0 |
|
n/m |
|
130.2 |
|
4.7 |
|
n/m |
Loss (gain) on divestitures – net |
— |
|
1,020.1 |
|
(100) % |
|
12.9 |
|
1,018.5 |
|
(99) % |
Other operating expense (income) – net |
1.9 |
|
(12.3) |
|
115 % |
|
29.2 |
|
(40.8) |
|
n/m |
Operating Income (Loss) |
406.0 |
|
(633.5) |
|
n/m |
|
1,305.8 |
|
157.5 |
|
n/m |
Operating margin |
18.4 % |
|
(28.3) % |
|
|
|
16.0 % |
|
1.8 % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense – net |
(97.3) |
|
(35.3) |
|
n/m |
|
(264.3) |
|
(152.0) |
|
74 % |
Other debt costs |
— |
|
— |
|
— % |
|
(19.5) |
|
— |
|
n/m |
Other income (expense) – net |
4.4 |
|
(9.8) |
|
145 % |
|
(25.6) |
|
(14.7) |
|
(74) % |
Income (Loss) Before Income Taxes |
313.1 |
|
(678.6) |
|
146 % |
|
996.4 |
|
(9.2) |
|
n/m |
Income tax expense (benefit) |
68.0 |
|
(77.9) |
|
n/m |
|
252.4 |
|
82.1 |
|
n/m |
Net Income (Loss) |
|
|
( |
|
141 % |
|
|
|
( |
|
n/m |
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per common share |
|
|
( |
|
141 % |
|
|
|
( |
|
n/m |
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per common share – assuming |
|
|
( |
|
140 % |
|
|
|
( |
|
n/m |
|
|
|
|
|
|
|
|
|
|
|
|
Dividends declared per common share |
|
|
|
|
4 % |
|
|
|
|
|
4 % |
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares outstanding |
106.2 |
|
105.4 |
|
1 % |
|
104.1 |
|
106.2 |
|
(2) % |
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares outstanding – |
106.4 |
|
105.4 |
|
1 % |
|
104.4 |
|
106.2 |
|
(2) % |
Unaudited Condensed Consolidated Balance Sheets |
||||
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in millions) |
||
Assets |
|
|
|
|
Current Assets |
|
|
|
|
Cash and cash equivalents |
|
|
|
|
Trade receivables – net |
|
736.5 |
|
597.6 |
Inventories |
|
1,038.9 |
|
1,009.8 |
Investment in equity securities |
|
— |
|
487.8 |
Other current assets |
|
129.5 |
|
107.7 |
Total Current Assets |
|
1,966.9 |
|
2,858.7 |
|
|
|
|
|
Property, Plant, and Equipment – Net |
|
3,072.7 |
|
2,239.5 |
|
|
|
|
|
Other Noncurrent Assets |
|
|
|
|
|
|
7,649.9 |
|
5,216.9 |
Other intangible assets – net |
|
7,255.4 |
|
4,429.3 |
Other noncurrent assets |
|
328.8 |
|
247.0 |
Total Other Noncurrent Assets |
|
15,234.1 |
|
9,893.2 |
Total Assets |
|
|
|
|
|
|
|
|
|
Liabilities and Shareholders' Equity |
|
|
|
|
Current Liabilities |
|
|
|
|
Accounts payable |
|
|
|
|
Current portion of long-term debt |
|
999.3 |
|
— |
Short-term borrowings |
|
591.0 |
|
— |
Other current liabilities |
|
834.6 |
|
594.1 |
Total Current Liabilities |
|
3,761.1 |
|
1,986.7 |
|
|
|
|
|
Noncurrent Liabilities |
|
|
|
|
Long-term debt, less current portion |
|
6,773.7 |
|
4,314.2 |
Other noncurrent liabilities |
|
2,045.0 |
|
1,399.7 |
Total Noncurrent Liabilities |
|
8,818.7 |
|
5,713.9 |
|
|
|
|
|
Total Shareholders' Equity |
|
7,693.9 |
|
7,290.8 |
Total Liabilities and Shareholders' Equity |
|
|
|
|
Unaudited Condensed Consolidated Statements of Cash Flow |
|||||||
|
|
|
|
||||
|
Three Months Ended |
|
Year Ended |
||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
(Dollars in millions) |
||||||
Operating Activities |
|
|
|
|
|
|
|
Net income (loss) |
|
|
( |
|
|
|
( |
Adjustments to reconcile net income (loss) to net cash provided by (used for) |
|
|
|
|
|
|
|
Depreciation |
69.0 |
|
52.1 |
|
239.7 |
|
224.1 |
Amortization |
56.0 |
|
40.1 |
|
191.1 |
|
206.9 |
Realized loss on investment in equity securities - net |
— |
|
— |
|
21.5 |
|
— |
Pension settlement loss (gain) |
— |
|
4.3 |
|
3.2 |
|
7.4 |
Share-based compensation expense |
8.0 |
|
14.3 |
|
23.9 |
|
25.6 |
Loss (gain) on divestitures – net |
— |
|
1,020.1 |
|
12.9 |
|
1,018.5 |
Deferred income tax expense (benefit) |
(18.4) |
|
(190.8) |
|
(40.5) |
|
(190.8) |
Loss (gain) on disposal of assets – net |
5.1 |
|
(2.4) |
|
7.8 |
|
5.1 |
Other noncash adjustments – net |
12.3 |
|
5.2 |
|
31.9 |
|
23.9 |
Settlement of interest rate contracts |
— |
|
— |
|
42.5 |
|
— |
Defined benefit pension contributions |
(1.3) |
|
(1.3) |
|
(4.1) |
|
(74.1) |
Changes in assets and liabilities, net of effect from acquisition and |
|
|
|
|
|
|
|
Trade receivables |
52.3 |
|
(64.1) |
|
41.5 |
|
(74.8) |
Inventories |
(52.4) |
|
20.0 |
|
2.9 |
|
(134.6) |
Other current assets |
(48.7) |
|
17.4 |
|
(35.5) |
|
86.8 |
Accounts payable |
66.2 |
|
105.3 |
|
(81.7) |
|
151.6 |
Accrued liabilities |
37.6 |
|
(25.8) |
|
99.4 |
|
0.4 |
Income and other taxes |
8.6 |
|
49.4 |
|
(34.9) |
|
9.5 |
Other – net |
(11.3) |
|
0.7 |
|
(36.2) |
|
0.2 |
Net Cash Provided by (Used for) Operating Activities |
428.1 |
|
443.8 |
|
1,229.4 |
|
1,194.4 |
|
|
|
|
|
|
|
|
Investing Activities |
|
|
|
|
|
|
|
Business acquired, net of cash acquired |
— |
|
— |
|
(3,920.6) |
|
— |
Proceeds from sale of equity securities |
— |
|
— |
|
466.3 |
|
— |
Proceeds from divestitures – net |
5.8 |
|
684.7 |
|
56.3 |
|
686.3 |
Additions to property, plant, and equipment |
(130.6) |
|
(145.1) |
|
(586.5) |
|
(477.4) |
Other – net |
21.4 |
|
23.4 |
|
19.9 |
|
47.3 |
Net Cash Provided by (Used for) Investing Activities |
(103.4) |
|
563.0 |
|
(3,964.6) |
|
256.2 |
|
|
|
|
|
|
|
|
Financing Activities |
|
|
|
|
|
|
|
Short-term borrowings (repayments) – net |
165.0 |
|
(0.7) |
|
578.2 |
|
(185.9) |
Proceeds from long-term debt |
— |
|
— |
|
4,285.0 |
|
— |
Repayments of long-term debt |
(350.0) |
|
— |
|
(1,791.0) |
|
— |
Capitalized debt issuance costs |
— |
|
— |
|
(32.1) |
|
— |
Quarterly dividends paid |
(112.0) |
|
(108.4) |
|
(437.5) |
|
(430.2) |
Purchase of treasury shares |
(0.3) |
|
(359.5) |
|
(372.8) |
|
(367.5) |
Proceeds from stock option exercises |
0.1 |
|
13.8 |
|
3.2 |
|
21.6 |
Payment of assumed tax receivable agreement obligation |
— |
|
— |
|
(86.4) |
|
— |
Other – net |
(0.7) |
|
(0.4) |
|
(5.0) |
|
(2.6) |
Net Cash Provided by (Used for) Financing Activities |
(297.9) |
|
(455.2) |
|
2,141.6 |
|
(964.6) |
Effect of exchange rate changes on cash |
(0.7) |
|
— |
|
(0.2) |
|
(0.1) |
Net increase (decrease) in cash and cash equivalents |
26.1 |
|
551.6 |
|
(593.8) |
|
485.9 |
Cash and cash equivalents at beginning of period |
35.9 |
|
104.2 |
|
655.8 |
|
169.9 |
Cash and Cash Equivalents at End of Period |
|
|
|
|
|
|
|
Unaudited Supplemental Schedule |
|||||||||||||||
|
|
|
|
||||||||||||
|
Three Months Ended |
|
Year Ended |
||||||||||||
|
2024 |
|
% of
|
|
2023 |
|
% of
|
|
2024 |
|
% of
|
|
2023 |
|
% of
|
|
(Dollars in millions) |
||||||||||||||
Net sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, distribution, and |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marketing |
135.6 |
|
6.1 % |
|
116.0 |
|
5.2 % |
|
441.6 |
|
5.4 % |
|
446.5 |
|
5.2 % |
Selling |
67.6 |
|
3.1 % |
|
56.8 |
|
2.5 % |
|
249.6 |
|
3.1 % |
|
238.3 |
|
2.8 % |
Distribution |
71.2 |
|
3.2 % |
|
71.8 |
|
3.2 % |
|
262.9 |
|
3.2 % |
|
298.6 |
|
3.5 % |
General and administrative |
150.5 |
|
6.8 % |
|
131.4 |
|
5.9 % |
|
492.1 |
|
6.0 % |
|
471.6 |
|
5.5 % |
Total selling, distribution, and |
|
|
19.3 % |
|
|
|
16.8 % |
|
|
|
17.7 % |
|
|
|
17.1 % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts may not add due to rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
Unaudited Reportable Segments |
||||||||
|
|
|
|
|
||||
|
|
Three Months Ended |
|
Year Ended |
||||
|
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
|
(Dollars in millions) |
||||||
Net sales: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
450.5 |
|
453.4 |
|
1,815.6 |
|
1,630.9 |
|
|
452.6 |
|
785.3 |
|
1,822.8 |
|
3,038.1 |
Sweet Baked Snacks |
|
337.0 |
|
— |
|
637.3 |
|
— |
International and Away From Home |
|
299.5 |
|
303.6 |
|
1,198.6 |
|
1,124.9 |
Total net sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment profit: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
95.8 |
|
103.4 |
|
434.1 |
|
352.6 |
|
|
114.1 |
|
145.5 |
|
402.1 |
|
494.9 |
Sweet Baked Snacks |
|
70.2 |
|
— |
|
138.2 |
|
— |
International and Away From Home |
|
61.1 |
|
47.6 |
|
208.1 |
|
143.3 |
Total segment profit |
|
|
|
|
|
|
|
|
Amortization |
|
(56.0) |
|
(40.1) |
|
(191.1) |
|
(206.9) |
Gain (loss) on divestitures – net |
|
— |
|
(1,020.1) |
|
(12.9) |
|
(1,018.5) |
Interest expense – net |
|
(97.3) |
|
(35.3) |
|
(264.3) |
|
(152.0) |
Change in net cumulative unallocated derivative gains |
|
27.8 |
|
22.0 |
|
6.7 |
|
(21.4) |
Cost of products sold – special project costs |
|
(2.9) |
|
(1.5) |
|
(2.9) |
|
(6.4) |
Other special project costs |
|
(24.5) |
|
(2.0) |
|
(130.2) |
|
(4.7) |
Other debt costs |
|
— |
|
— |
|
(19.5) |
|
— |
Corporate administrative expenses |
|
(89.9) |
|
(88.4) |
|
(305.5) |
|
(313.1) |
Other income (expense) – net |
|
4.4 |
|
(9.8) |
|
(25.6) |
|
(14.7) |
Income (loss) before income taxes |
|
|
|
( |
|
|
|
( |
|
|
|
|
|
|
|
|
|
Segment profit margin: |
|
|
|
|
|
|
|
|
|
|
31.6 % |
|
28.9 % |
|
28.1 % |
|
27.0 % |
|
|
21.3 % |
|
22.8 % |
|
23.9 % |
|
21.6 % |
|
|
25.2 % |
|
18.5 % |
|
22.1 % |
|
16.3 % |
Sweet Baked Snacks |
|
20.8 % |
|
— % |
|
21.7 % |
|
— % |
International and Away From Home |
|
20.4 % |
|
15.7 % |
|
17.4 % |
|
12.7 % |
Non-GAAP Financial Measures
The Company uses non-GAAP financial measures, including: net sales excluding acquisition, divestitures, and foreign currency exchange; adjusted gross profit; adjusted operating income; adjusted income; adjusted earnings per share; earnings before interest, taxes, depreciation, amortization, impairment charges related to intangible assets, and gains and losses on divestitures ("EBITDA (as adjusted)"); and free cash flow, as key measures for purposes of evaluating performance internally. The Company believes that investors' understanding of its performance is enhanced by disclosing these performance measures. Furthermore, these non-GAAP financial measures are used by management in preparation of the annual budget and for the monthly analyses of its operating results. The Board of Directors also utilizes certain non-GAAP financial measures as components for measuring performance for incentive compensation purposes.
Non-GAAP financial measures exclude certain items affecting comparability that can significantly affect the year-over-year assessment of operating results, which include amortization expense and impairment charges related to intangible assets; certain divestiture, acquisition, integration, and restructuring costs ("special project costs"); gains and losses on divestitures; the net change in cumulative unallocated gains and losses on commodity and foreign currency exchange derivative activities ("change in net cumulative unallocated derivative gains and losses"); and other infrequently occurring items that do not directly reflect ongoing operating results. Income taxes, as adjusted is calculated using an adjusted effective income tax rate that is applied to adjusted income before income taxes and reflects the exclusion of the previously discussed items, as well as any adjustments for one-time tax-related activities, when they occur. While this adjusted effective income tax rate does not generally differ materially from the GAAP effective income tax rate, certain exclusions from non-GAAP results, such as unfavorable tax impacts associated with the acquisition of Hostess Brands in 2024 and unfavorable permanent tax impacts of the divestiture of certain pet food brands during 2023, can significantly impact the adjusted effective income tax rate.
These non-GAAP financial measures are not intended to replace the presentation of financial results in accordance with
Unaudited Non-GAAP Financial Measures |
|||||||||||||||
|
|
|
|
||||||||||||
|
Three Months Ended |
|
Year Ended |
||||||||||||
|
2024 |
|
2023 |
|
Increase |
|
% |
|
2024 |
|
2023 |
|
Increase |
|
% |
|
(Dollars in millions) |
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales reconciliation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
|
|
|
|
( |
|
(1) % |
|
|
|
|
|
( |
|
(4) % |
Hostess Brands acquisition |
(337.0) |
|
— |
|
(337.0) |
|
(15) |
|
(637.3) |
|
— |
|
(637.3) |
|
(7) |
Pet food brands divestiture |
— |
|
(384.9) |
|
384.9 |
|
17 |
|
— |
|
(1,522.4) |
|
1,522.4 |
|
18 |
Sahale Snacks ® divestiture |
— |
|
(12.3) |
|
12.3 |
|
1 |
|
— |
|
(23.7) |
|
23.7 |
|
— |
|
— |
|
(15.6) |
|
15.6 |
|
1 |
|
— |
|
(19.4) |
|
19.4 |
|
— |
Foreign currency exchange |
0.2 |
|
— |
|
0.2 |
|
— |
|
6.8 |
|
— |
|
6.8 |
|
— |
Net sales excluding acquisition, |
|
|
|
|
|
|
3 % |
|
|
|
|
|
|
|
8 % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts may not add due to rounding. |
|
|
|
|
|
|
|
|
|
|
Unaudited Non-GAAP Financial Measures |
|||||||
|
|
|
|
||||
|
Three Months Ended |
|
Year Ended |
||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
(Dollars in millions, except per share data) |
||||||
Gross profit reconciliation: |
|
|
|
|
|
|
|
Gross profit |
|
|
|
|
|
|
|
Change in net cumulative unallocated derivative gains and losses |
(27.8) |
|
(22.0) |
|
(6.7) |
|
21.4 |
Cost of products sold – special project costs |
2.9 |
|
1.5 |
|
2.9 |
|
6.4 |
Adjusted gross profit |
|
|
|
|
|
|
|
% of net sales |
40.3 % |
|
34.5 % |
|
38.0 % |
|
33.2 % |
|
|
|
|
|
|
|
|
Operating income (loss) reconciliation: |
|
|
|
|
|
|
|
Operating income (loss) |
|
|
( |
|
|
|
|
Amortization |
56.0 |
|
40.1 |
|
191.1 |
|
206.9 |
Loss (gain) on divestitures – net |
— |
|
1,020.1 |
|
12.9 |
|
1,018.5 |
Change in net cumulative unallocated derivative gains and losses |
(27.8) |
|
(22.0) |
|
(6.7) |
|
21.4 |
Cost of products sold – special project costs |
2.9 |
|
1.5 |
|
2.9 |
|
6.4 |
Other special project costs |
24.5 |
|
2.0 |
|
130.2 |
|
4.7 |
Adjusted operating income |
|
|
|
|
|
|
|
% of net sales |
20.9 % |
|
18.3 % |
|
20.0 % |
|
16.6 % |
|
|
|
|
|
|
|
|
Net income (loss) reconciliation: |
|
|
|
|
|
|
|
Net income (loss) |
|
|
( |
|
|
|
( |
Income tax expense (benefit) |
68.0 |
|
(77.9) |
|
252.4 |
|
82.1 |
Amortization |
56.0 |
|
40.1 |
|
191.1 |
|
206.9 |
Loss (gain) on divestitures – net |
— |
|
1,020.1 |
|
12.9 |
|
1,018.5 |
Change in net cumulative unallocated derivative gains and losses |
(27.8) |
|
(22.0) |
|
(6.7) |
|
21.4 |
Cost of products sold – special project costs |
2.9 |
|
1.5 |
|
2.9 |
|
6.4 |
Other special project costs |
24.5 |
|
2.0 |
|
130.2 |
|
4.7 |
Other debt costs – special project costs |
— |
|
— |
|
19.5 |
|
— |
Other expense – special project costs |
— |
|
— |
|
0.3 |
|
— |
Other infrequently occurring items: |
|
|
|
|
|
|
|
Realized loss on investment in equity securities - net (A) |
— |
|
3.8 |
|
21.5 |
|
3.8 |
Pension plan termination settlement charge (B) |
— |
|
— |
|
3.2 |
|
— |
Adjusted income before income taxes |
|
|
|
|
|
|
|
Income taxes, as adjusted |
85.3 |
|
87.2 |
|
333.3 |
|
301.7 |
Adjusted income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares outstanding – assuming dilution (C) |
106.4 |
|
105.9 |
|
104.4 |
|
106.6 |
|
|
|
|
|
|
|
|
Adjusted earnings per share – assuming dilution (C) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(A) Realized loss on investment in equity securities - net includes the realized gains and losses on the change in fair value on the
(B) Represents the nonrecurring pre-tax settlement charge recognized during the first quarter of 2024 related to the acceleration of
(C) Adjusted earnings per common share – assuming dilution for 2024 and 2023 was computed using the treasury stock method. Further, |
Unaudited Non-GAAP Financial Measures |
|||||||
|
|
|
|
||||
|
Three Months Ended |
|
Year Ended |
||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
(Dollars in millions) |
||||||
EBITDA (as adjusted) reconciliation: |
|
|
|
|
|
|
|
Net income (loss) |
|
|
( |
|
|
|
( |
Income tax expense (benefit) |
68.0 |
|
(77.9) |
|
252.4 |
|
82.1 |
Interest expense – net |
97.3 |
|
35.3 |
|
264.3 |
|
152.0 |
Depreciation |
69.0 |
|
52.1 |
|
239.7 |
|
224.1 |
Amortization |
56.0 |
|
40.1 |
|
191.1 |
|
206.9 |
Loss (gain) on divestitures – net |
— |
|
1,020.1 |
|
12.9 |
|
1,018.5 |
EBITDA (as adjusted) |
|
|
|
|
|
|
|
% of net sales |
24.3 % |
|
21.0 % |
|
20.8 % |
|
18.7 % |
|
|
|
|
|
|
|
|
Free cash flow reconciliation: |
|
|
|
|
|
|
|
Net cash provided by (used for) operating activities |
|
|
|
|
|
|
|
Additions to property, plant, and equipment |
(130.6) |
|
(145.1) |
|
(586.5) |
|
(477.4) |
Free cash flow |
|
|
|
|
|
|
|
The following tables provide a reconciliation of the Company's fiscal year 2025 guidance for estimated adjusted earnings per share and free cash flow.
|
|
Year Ending |
||
|
|
Low |
|
High |
Net income per common share – assuming dilution reconciliation: |
|
|
|
|
Net income per common share – assuming dilution |
|
|
|
|
Change in net cumulative unallocated derivative gains and losses(A) |
|
0.16 |
|
0.16 |
Amortization |
|
1.59 |
|
1.59 |
Special project costs |
|
0.49 |
|
0.49 |
Pension plan termination settlement charge(B) |
|
0.36 |
|
0.36 |
Adjusted earnings per share |
|
|
|
|
|
|
|
|
|
(A) We are unable to project derivative gains and losses on a forward-looking basis as these will vary each quarter based on market
(B) Represents a non-recurring pre-tax settlement charge related to the termination of one of the Company's |
|
|
Year Ending |
|
|
|
|
(Dollars in |
|
|
Free cash flow reconciliation: |
|
|
|
|
Net cash provided by operating activities |
|
|
|
|
Additions to property, plant, and equipment |
|
(450) |
|
|
Free cash flow |
|
|
|
|
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