Megan Clapp's questions to J M SMUCKER (SJM) leadership • Q1 2026
Question
Megan Clapp of Morgan Stanley inquired about the increased free cash flow outlook, asking if it was a one-time benefit and how the company plans to use the additional cash. She also asked for help unpacking the Q2 mid-single-digit sales outlook, particularly which segments are expected to drive sequential improvement.
Answer
CFO Tucker Marshall clarified that the $100 million increase in free cash flow guidance is an ongoing annual benefit from the 'One Big Beautiful Bill Act,' not a one-time event. He stated the incremental cash will be used for debt paydown to achieve a three-times leverage target by the end of fiscal 2027. For Q2 sales, he pointed to continued momentum in coffee, Uncrustables, cat food, the Away From Home business, and stabilization in Sweet Baked Snacks.