Smucker's High-Margin Business Focus Helps Boost Profit -- Market Talk
Smucker's sales fell below expectations, but its profit beat in the latest quarter. Smucker executives says it's cutting back on discretionary spending, using zero-base budgeting and offloading low-margin businesses. "We are focused on growing those brands or businesses that have higher profitability," Chief Executive Mark Smucker says in an interview. That's why Smucker sold the Pillsbury baking business last year and got into the pet-food business. It has higher margins than Smucker's commodity foods like peanut butter and Folgers coffee. Snacks are another growth driver. That segment, with Uncrustables frozen peanut-butter-and-jelly sandwiches and Jif Power Ups granola bars, logged 18% sales growth in the latest quarter. "We are killing it with Uncrustables," Smucker says.