The Campbell Soup Company posted a bigger-than-expected quarterly profit and gave an upbeat full-year outlook yesterday, helped by improved soup sales. Its shares rose more than 4 per cent.
After several winters of soup sales suffering from heavy discounting and a lack of innovation, Campbell and its new chief executive officer are trying to improve performance with a range of new products, including Thai green curry skillet sauce.
Chief executive Denise Morrison, who has held the top job for just over a year, said retailers were responding favourably to the new products, even though much of the quarter’s soup demand came from the timing of promotions, which spurred sales of Campbell’s iconic red-and-white canned varieties.
The company’s US soup sales rose 9 per cent in the just-ended fourth quarter, with condensed products up 14 per cent and ready-to-serve up 1 per cent.
Broth sales increased 4 per cent, helped by a new Swanson product.
Net income was $127 million (€101,000), or 40 cents a share, in the fourth quarter, ended on July 31st, up from $100 million, or 31 cents a share, a year earlier. Excluding costs from last month’s acquisition of Bolthouse Farms, earnings were 41 cents a share. Sales were flat at $1.61 billion.
At an investor meeting in July, Campbell executives said the turnaround they are trying to implement was taking longer than expected because of a difficult market.
Their plan includes stabilising and expanding Campbell’s North American soup and simple meals business, increasing the company’s international presence and expanding the beverage and baked snack units, which include V8 juices and Pepperidge Farm cookies.
Campbell forecast fiscal 2013 earnings of $2.51 to $2.57 per share, excluding special items. Analysts were expecting $2.52.– (Reuters)
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