Campbell 'far from satisfied' with soups

by Monica Watrous
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CAMDEN, N.J. — Despite improved results for its U.S. Soups business, the Campbell Soup Co. remains disappointed with the segment’s performance.

“While we delivered growth in soup sales, we are far from satisfied with category consumption and our consumption performance,” said Denise Morrison, president and chief executive officer. “Accordingly, we have more aggressive plans in the second half.”

With a strong promotional calendar lined up for the third quarter and marketing in place to drive consumption, the company expects the soup business to deliver modest growth during the remainder of the year. Eight soups were launched in January that included the company’s first Hispanic-inspired line of cooking soups, new pub-inspired varieties of Campbell’s Chunky and new Healthy Request varieties.

Campbell said it has seen an increase in homemade soup behavior, contributing to a 21% increase in broths during the quarter.

“People are making more soup at home, and they are cooking more with broth, which is great,” Ms. Morrison said. “We do think that is partially driven by some of the innovation we have brought to the broth segment of the soup category with new flavor-infused varieties, and we have also changed our advertising campaign to really emphasize insights on ‘why I cook.’”

Launched in October, Swanson flavor-infused broths include Mexican Tortilla, Thai Ginger and Chinese Hot and Sour.

“Importantly, we expect other businesses to contribute more significantly to growth in the second half while soup does its part,” Ms. Morrison added.

Net income in the second quarter at Campbell Soup was $325 million, equal to $1.03 per share on the common stock, up 71% from $190 million, or 60c per share, in the same period a year ago. Net sales for the second quarter were $2,281 million, up 6% from $2,162 million.

For the first half of fiscal 2014, income increased 14% to $497 million, or $1.57 per share, from $435 million, or $1.38 per share. Net sales rose 2% to $4,446 million from $4,367 million.
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