During the second quarter of fiscal year 2025, J.M. Smucker’s pet foods division reported a net sales decreased 4% versus the prior year. However, this was primarily due to a US$23 million reduction in contract manufacturing sales related to the divested pet food brands. Excluding this, net sales increased by 1%. Inflation continued to weigh on Smucker’s dog snacks category as pet owners reduced discretionary spending, according to the company.
“Lower net price realization decreased net sales by 2 percentage points, primarily reflecting higher trade spend for cat food and dog snacks,” Tucker Marshall, CFO of J.M. Smucker, said in prepared remarks. “U.S. Retail Pet Foods segment profit increased 25%, primarily driven by lower costs, favorable volume/mix, and lower distribution and marketing expenses, partially offset by lower net price realization.”
Meow Mix and Milk-Bone brands led this growth. The launch of Milk-Bone Peanut Buttery Bites featuring Jif peanut butter aided the brands’ growth. The Meow-Mix brand had the top volume share position in the dry cat food category, according to the company. Smucker plans to refresh the Meow-Mix brand with new packaging in January 2025. However, Smucker’s leaders foresee near-term challenges for the Pup-Peroni brand, while sales of Canine Carry Outs also declined.
Smucker’s pet portfolio profit margins were strong, the company’s leaders stated in a press release. These profit margins were driven by operational improvements from its transformation office and the winding down of its contract manufacturing agreement. This transformed portfolio focuses on brands and categories where we have a leading market share position as these brands continue to deliver net sales and margin growth.
“The Milk-Bone brand demonstrated mid-single-digit volume/mix growth led by Soft and Chewy and Biscuits,” Mark Smucker, CEO of J.M. Smucker, said in prepared remarks. “Strong net sales growth in soft and chewy snacks of double digits versus the prior year was aided by innovation, namely Milk-Bone Peanut Buttery Bites made with Jif peanut butter. This launch continues to exceed our expectations, and we are excited to launch this product nationally this coming January. We continue to drive the humanization trend in the category. As one of the few companies with both iconic human and pet food brands, we are able to create a unique consumer experience of consumers sharing foods they love with their pets. In cat food, the Meow Mix brand continued its momentum with high-single-digit volume/mix growth in the quarter.
“The Meow Mix brand has the number one volume share position in the dry cat food category, and we are fueling further growth by refreshing the brand with new packaging launching in January. This new packaging design showcases consumer-desired claims in a fresh, new way with elevated product benefits and a more modern design. We are also launching innovation at the same time that will bring the indulgence and dual texture experience out of the wet aisle and into the convenience of the dry aisle to elevate the mealtime experience for both the cat and pet parent.”
