(Reuters) - Jif peanut butter maker J.M. Smucker on Tuesday raised its annual profit forecast on higher prices of its jams, jellies and pet food products as well as moderating costs of packaging and raw materials.
Shares of the company rose about 3% in premarket trading as it also beat Wall Street estimates for first-quarter profit.
Reflecting an industry-wide trend, the Ohio-based company raised prices of its products, including packaged jams and jellies, Dunkin Coffee and Meow Mix cat food to offset higher costs of raw materials, manufacturing and packaging.
Demand for kitchen condiments has also been steady as Americans battling higher costs of living increasingly eat at home, supporting sales at J.M. Smucker.
"The categories we play in continue to be resilient and have relatively low private label exposure," CEO Mark Smucker said in a statement.
The company said net sales of its Smucker's Uncrustables frozen sandwiches grew 11%, driven by double-digit growth in demand.
Domestic net sales in its retail consumer foods segment rose 49%. Excluding the hit from the divestiture of some of its pet food brands, the company's net sales in the domestic pet food segment rose 22% from a year earlier.
J.M. Smucker now expects annual adjusted earnings per share between $9.45 and $9.85, compared with $9.20 to $9.60 per share forecast earlier.
The company's gross margin for the quarter ended July 31, rose to 36.3%, compared with 29.5% a year earlier.
Excluding items, J.M. Smucker earned $2.21 per share, compared with estimates of a profit of $2.04 per share.
The company's quarterly net sales, however, fell 4% to $1.81 billion, compared with analysts' average estimate of $1.84 billion as per Refinitiv data.