Campbell Soup Quarterly Sales Fall 2.3%

StocksReuters

Campbell Soup reported a better-than-expected quarterly profit and raised its full-year profit forecast on Tuesday as cost-saving measures kicked in.

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The world's No. 1 soup maker said in July it was targeting cost savings of $250 million annually by the end of fiscal 2018.

Like others in the packaged food industry, Campbell has been struggling to increase revenue as consumers opt for food items that are perceived to be healthier.

The results were the first since Campbell reorganized its business into three segments, down from five previously.

The traditional soup business is included in a new division called Americas Simple Meals and Beverages. That business reported a 2 percent drop in sales to $1.30 billion in the first quarter ended Nov. 1 from a year earlier.

The other two businesses are Global Biscuits and Snacks, which includes Pepperidge Farm and Arnott's cookies, and Campbell Fresh, which combines recently acquired salsa maker Garden Fresh Gourmet with the Bolthouse Farms juice business.

Sales in the biscuits and snacks business fell 6 percent to $652 million in the quarter, while Campbell Fresh sales rose 8 percent to $249 million.

Total net sales fell 2.3 percent to $2.20 billion, slightly below the average analyst estimate of $2.21 billion, according to Thomson Reuters I/B/E/S.

Net income attributable to the company fell to $194 million, or 62 cents per share from $248 million, or 78 cents per share, a year earlier.

Excluding items, Campbell earned 95 cents per share, handily beating the average analyst estimate of 76 cents.

The company forecast a full-year 2016 adjusted profit of $2.75-$2.83 per share.

Analysts on average had been expecting $2.59.

Up to Monday's close of $49.79, Campbell's stock had risen about 13 percent this year.

(Reporting by Subrat Patnaik in Bengaluru; Editing by Ted Kerr)

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