Jif maker J.M. Smucker shares hit by soft guidance that includes cost of peanut butter recall

J.M. Smucker Co. shares slid 3.5% in premarket trade Tuesday, after the parent to brands including Folgers, Jif and Milk-Bone posted better-than-expected earnings for its fourth fiscal quarter but guidance that fell short of consensus. The Orrville, Ohio-based company posted net income of $202.1 million, or $1.87 a share, for the quarter to April 30, up from $147 million, or $1.35 a share, n the year-earlier period. Adjusted per-share earnings came to $2.23, ahead of the $1.88 FactSet consensus. Sales rose 6% to $2.034 billion from $1.92 billion a year ago, also ahead of the $1.978 billion FactSet consensus. The company initiated a recall of select Jif peanut butter products after quarter end at its Lexington, Ky., facility due to potential salmonella contamination. It expects an unfavorable impact from the recall to weigh on fiscal-year 2023 earnings to the tune of $125 million, net of insurance recoveries. It now expects sales for the coming year to rise 3.5% to 4.5% and for adjusted EPS to range from $7.85 to $8.25. The FactSet consensus is for sales to rise about 3% and for EPS of $8.89. Shares have fallen 9% in to date in 2022, while the S&P 500 has fallen 13.5%.

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