Campbell income down on restructuring charges

by Staff
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CAMDEN, N.J. — Charges related to restructuring in Mexico contributed to a 7% decline in earnings at Campbell Soup Co. during the second quarter.

For the quarter ended Jan. 27, the company had earnings of $190 million, equal to 61c per share on the common stock, which compared with earnings of $205 million, or 64c per share, during the same quarter of the previous year. Sales for the quarter were $2,333 million, up 10% from $2,112 million.

“Within U.S. Simple Meals, we saw growth in U.S. Soup as consumers responded to our efforts in brand-building and innovation, both in our core business and in new products,” said Denise Morrison, president and chief executive officer. “While we reduced overall advertising spending, we were able to maintain competitive levels and to increase advertising support for new innovation. Our work to improve taste adventure and deliver more effective and efficient marketing and promotion resulted in increased consumption in this important business.

“Our Global Baking and Snacking business has benefitted from innovation in both core brands and new products, plus increased distribution and merchandising. Gains in snack crackers, cookies and fresh bakery products drove sales and earnings at Pepperidge Farm. Arnott’s sales increased with solid performance in Australia and Indonesia.

“Our newly acquired Bolthouse Farms business delivered solid results in the fresh carrots, beverages and salad dressings categories, driven by innovation and increased distribution. The Bolthouse Farms integration is also progressing well.

“Despite weakness in our U.S. Beverages and North America Foodservice businesses, our first-half business results were positive. Although profits in U.S. Beverages improved, we have more work to do to drive the top-line and continue to stabilize profit in a sluggish shelf-stable juice category. Halfway through our fiscal year, we are making progress against our plans to return Campbell to sustainable, profitable net sales growth.”

During the quarter, the U.S. Simple Meals segment had earnings of $191 million, up 10% from $174 million during the same quarter of the previous year. Sales for the quarter were $833 million, up 1% from $824 million.

The Global Baking and Snacking segment had earnings of $74 million, up 4% from $71 million during the same quarter of the previous year. The segment had sales of $561 million, up 7% from $526 million.

Operating earnings in the U.S. Beverages segment totaled $37 million, up 9% from $34 million during the same quarter of the previous year. The segment had sales of $182 million, down 3% from $187 million.

For the six months ended Jan. 27, the company as a whole had earnings of $435 million, or $1.39 per share, down 7% from $470 million, or $1.46 per share, during the same period of the previous year. Sales for the period were $4,669 million, up 9% from $4,273 million.

The company is expecting adjusted earnings per share for fiscal 2013 to be in the range of $2.51 and $2.57.
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