Campbell Soup's sales up, but profit down

Denise Morrison : Campbell's to confront critical shifts.
Denise Morrison : Campbell's to confront critical shifts.
By Bob Fernandez, INQUIRER STAFF WRITER
Posted: November 21, 2012

Campbell Soup Co. first-quarter revenue rose 8 percent mostly because of new products in its portfolio with the recent acquisition of Bolthouse Farms of California but profits fell because of transaction and restructuring costs.

Denise Morrison, the chief executive officer who was hired in 2011 to jolt the company into a higher-growth mode, said in a conference call the Camden company introduced 50 new products this year, compared with three in 2010, and is targeting younger consumers.

“It’s early days on the new products to declare victory,” Morrison said. “This will not be a one-year wonder but I really do believe we are on the right course.”

Sales for the quarter amounted to $2.34 billion compared with $2.16 billion in the year-ago period, while net earnings fell to $245 million, or 78 cents a share, from $265 million, or 82 cents a share, in the year-ago period.

Earnings in the recent quarter were brought down by $21 million in charges related to restructuring its supply chain and $10 million in transaction costs on the Bolthouse acquisition.

Debt at the company rose to $4.1 billion from $2.7 billion because of Bolthouse, whose three product lines are carrots, salad dressings and beverages.

At Pepperidge Farm, sales of Goldfish and Jingos increased but those of cookies and baked goods were soft.

A problem area was the beverage unit. Campbell executives said consumers appear to be trading-down, or buying less expensive, in the juices category. Campbell reduced its advertising and marketing expenses. It administrative expenses rose partly because of pension costs.

At 11:30 a.m., Campbell shares were down 2 percent, or 74 cents, to $36.21.

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