An exchange traded note that follows coffee futures rose 1% on Thursday while JM Smucker (NYSE: SJM) said its quarterly profit weakened although it was able to pass some higher coffee costs along to consumers.
Smucker, which owns the Folgers and Dunkin’ Donuts brands, said costs were “significantly higher” for green coffee in the fourth quarter.
“As expected, price increases taken throughout the year to offset higher commodity costs were realized and contributed to incremental gross profit, but did not generate margin expansion,” the company said in the earnings release.
Smucker said its U.S. retail coffee business saw net sales rise 21% in the fourth quarter “primarily reflecting the impact of three price increases taken during 2011 totaling 23%.”
The company’s recent price increase was its fourth and biggest hike in a year. [Coffee ETN Falls After Smucker Price Hike]