The J.M. Smucker Co. announced the results for the second quarter ended October 31, 2020, of its 2021 fiscal year. Net sales increased 4%, primarily due to favorable volume/mix for the company’s US retail coffee and US retail consumer foods segments, reflecting elevated at-home consumption, partially offset by reduced volume/mix for its away-from-home operating segment.
Gross profit increased USD64.2m, or 9%, primarily due to a favorable change in unallocated derivative gains and losses as compared to the prior year and the increased contribution from volume/mix. Operating income increased USD51m, or 15%, primarily reflecting the increase in gross profit, partially offset by a USD21.3m increase in selling, distribution, and administrative expenses.
Cash provided by operating activities was USD378.7m, compared to USD224.0m in the prior year, primarily reflecting a decrease in cash required to fund working capital and an increase in net income adjusted for non-cash items. Free cash flow was USD326.3m, compared to USD160.6m in the prior year, reflecting the increase in cash provided by operating activities and a USD11m decrease in capital expenditures. Net debt repayments in the quarter totaled USD216.1m.
“In the second quarter, we focused on meeting the demands created by the current environment, while continuing to execute our long-term strategy to deliver sustainable growth,” Mark Smucker, president, and chief executive officer said. “Our US retail consumer foods and US retail coffee businesses experienced strong sales momentum from elevated at-home consumption trends and grew market share. I want to thank our employees for their ongoing hard work and dedication to provide our customers, consumers, and their pets with a steady food supply from trusted and iconic brands.”