JM Smucker CEO: 'Our entire business benefits from folks having stayed at home'
In This Article:
JM Smucker CEO Mark Smucker joins Yahoo Finance Live to discuss how his company is dealing with increasing prices due to inflation.
Video Transcript
BRIAN SOZZI: JM Smucker is out with better than expected quarterly sales and profits this morning. What's interesting here is that the company lifted its full year profit outlook, which isn't something we have seen recently from others in the packaged food space due, in large part, to inflationary pressures. Let's check in with JM Smucker's CEO, Mark Smucker. Yahoo Finance's Brooke DiPalma is here as well. Good morning to you both. Mark, you mentioned in the earnings release that you took initial, initial pricing reactions. What has been the consumer response to those?
MARK SMUCKER: Well, actually, as you, know there's been a tremendous amount of inflation. And that is driven not only by input costs, but also just the challenges in the supply chain. But like many companies, we are accustomed to moving on price based on our underlying costs. And so we have taken several price increases across our entire business and our portfolio. And those have been passed through. And realistically, our consumers have accepted them. And we have not seen a downward pressure on the elasticities that we would have normally expected. So it's going-- it has gone very well.
BROOKE DIPALMA: Good morning, Mark. This past week, coffee prices surged to a seven-year high as Americans really do face inflationary pressures overall. Now, in JM Smucker's portfolio, coffee saw an 8% increase compared to a year ago. And that was led by both Dunkin' and Cafe Bustelo. Are consumers still drinking their coffees at home and trying to avoid those inflationary pressures?
MARK SMUCKER: Absolutely. In fact, our entire business benefits from folks having stayed at home and continuing to stay at home as we go back to a new normal, where folks will probably work more time from home than away from home or in the office. And that benefits because our products are consumed at breakfast and lunch primarily. And then, of course, our pet snacks business is how we treat our pets at home. So all of those businesses are strong, coffee specifically as well. 72% of coffee consumption occasions take place at home. And that is up from about 65% pre-pandemic, so clearly, our growth across all of our coffee brands is being helped by that dynamic.
BRIAN SOZZI: And Mark, you have a fairly sizable international business. Have you seen an acceleration in growth there recently, just given what we have seen with COVID cases picking back up in Europe?