J.M. Smucker to take $125 million hit from Jif peanut butter recall

[June 07, 2022]  (Reuters) - J.M. Smucker Co on Tuesday warned of a $125 million hit in the full year from the recall of certain Jif peanut butter products following possible salmonella contamination.

The recall would also have a 90 cent impact on the Folgers coffee maker's profit, the Ohio-based company said, sending its shares down 3% in premarket trading.

Late in May, J.M. Smucker said it was recalling nearly 50 types of Jif peanut butter products sold in the United States after a Food and Drug Administration investigation into a multistate outbreak of Salmonella Senftenberg infections.

Manufacturing downtime, customer returns and unsaleable inventory resulting from the recall are expected to result in the $125 million hit in fiscal 2023.

The company expects adjusted earnings per share to range from $7.85 to $8.25 in fiscal year 2023, compared with analysts' estimates of $8.91 per share, according to Refinitiv IBES.

For the fourth quarter ended April 30, net sales rose 6% to $2.03 billion, compared with estimates of $1.98 billion.

(Reporting by Deborah Sophia in Bengaluru; Editing by Devika Syamnath)

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