© Reuters. FILE PHOTO: Smucker’s Goober Strawberry and Jif peanut butter, brands owned by The JM Smucker Company, went on sale in a store in Manhattan, New York City, USA, on November 22, 2021. REUTERS / Andrew Kelly
(Reuters) – JM Smucker Co. on Tuesday warned of a $ 125 million year-round hit from the recall of certain Jif peanut butter products following possible salmonella contamination.
The recall will also have a 90-cent impact on Folgers coffee machine profits, said the Ohio-based company, which sent its shares down 3% in pre-market trading.
In late May, JM Smucker said it recalled nearly 50 types of Jif peanut butter products sold in the U.S. following an investigation by the Food and Drug Administration into a multi-state outbreak of Salmonella Senftenberg infections.
Downtime in production, customer turnaround and unsaleable inventory as a result of the recall are expected to result in a hit of $ 125 million in fiscal year 2023.
The company expects adjusted earnings per share to range from $ 7.85 to $ 8.25 in fiscal year 2023, compared to analysts’ estimates of $ 8.91 per share, according to Refinitive IBES.
For the fourth quarter, ending April 30, revenue increased 6% to $ 2.03 billion, compared to estimates of $ 1.98 billion.
