J.M. Smucker CEO Richard Smucker told shareholders Wednesday that the company plans to end fiscal 2016 with about $8 billion in sales, thanks to the Big Heart Pet Brands acquisition.
ORRVILLE, Ohio - Less than five months after acquiring Big Heart Pet Brands, the J.M. Smucker Co. told shareholders it plans to end its 2016 fiscal year with about $8 billion in sales.
That's an enormous jump from fiscal 2002, when Smucker's sales were $650 million, reflecting the Wayne County-based food company's focus on acquisitions, expansion and innovation.
Since then, Smucker has acquired Jif Peanut Butter and Crisco oils and shortenings (2002), Pillsbury frostings and baking mixes (2004), and Folgers Coffee (2008).
Smucker is now the eighth largest shelf-stable food and beverage company in the nation, with eight of the No. 1 brands in the United States and seven No. 1 brands in Canada.
J.M. Smucker CEO Richard Smucker Chief Executive Officer Richard Smucker said the company's March 24 acquisition of Big Heart Pet Brands for $6 billion, including Milk-Bone, Meow Mix, Kibbles 'n Bits and 9 Lives, "fits perfectly with our purpose of helping to bring families together to share memorable meals and moments."
Although the company's foray in to pet foods is recent, "our four-legged friends have been there all along, under the tables and in the homes and hearts of the consumers we have served for generations," he added.
In a category that serves more than 80 million U.S. families with pets, J.M. Smucker is now No. 1 in dog snacks and No. 2 in cat food. The company expects about 30 percent of its annual sales to come from pet foods and snacks.
Dave West, president of Big Heart Pet Foods and Snacks, said the $21 billion dog and cat food industry is one of the largest and fastest-growing categories of consumer packaged goods. Smucker's dog snacks grew about 12 percent last year, driven largely by Milk-Bone Brushing Chews, which taste like a treat but clean like a toothbrush, he said.
New products planned for fiscal 2016 include Milk-Bone Good Morning dog vitamin treats, Meow Mix Irresistables cat treats, and peanut butter Milk-Bone dog treats. Big Heart makes all its pet foods in five U.S. factories, which are separate from Smucker's food and beverage manufacturing facilities.
"The future of our pet brands is very bright given that we have established strong profit margins for the pet business and reinvested into innovation and brand-building," West said. "And the prospects are very promising for these brands now that they are part of the Smucker Company, which has an established history of nurturing acquired brands for long-term growth."
J.M. Smucker bought Sahale Snacks fruit and nut mixes in September 2014. Other Smucker highlights in fiscal 2015:
-- Sahale Snacks, acquired in September 2014, was the company's other major acquisition last fiscal year. "With 94 percent of Americans snacking at least once a day, Sahale... allows us to offer nutritious, great-tasting snacks made simply from premium nuts, dried fruits, and spices," said Vince Byrd, company vice chairman.
-- Jif, Smucker's, Uncrustables thaw-and-eat sandwiches, and other consumer foods posted record profits, up 10 percent. Sales of Uncrustables have grown by double-digit volumes for 13 straight quarters, and is now back in the U.S.D.A. school lunch programs.
-- Smucker expanded its Memphis, Tennessee, peanut butter factory so it can make even more peanut butter in coming years.
Dunkin' Donuts K-Cups -- Smucker has high hopes for its new Dunkin' Donuts K-Cups, which the company hopes will be as popular as its Dunkin' Donuts packaged coffee sold in supermarkets and other K-Cup brands. "We anticipate that it could be a $300 million business in the next couple of years," Byrd said.
-- Although high green coffee prices pinched profits last year, the company cut prices on Folgers and Dunkin' Donuts packaged coffee by an average of 6 percent when commodity costs fell, and expects better sales in this year.
-- Smucker continues to roll out new products, including single-serve Sahale Snacks, Jif peanut butter and granola bars, Jif Dippers, Smucker's Fruit 'n Honey, Pillsbury Purely Simple baking mixes and frosting, Smucker's Fruit-Fulls blended fruit pouches. New food products introduced within the last three years contributed about $370 million, or about 7 percent, to net sales in fiscal 2015.
-- Smucker recently raised its quarterly dividend by 5 percent, its 14th consecutive year of growth and its 57th straight year of paying out dividends to shareholders.
Smucker's shares closed at $109.35 Wednesday, up 1 percent from Tuesday's close of $108.23.