Campbell Soup posts double-digit gains for sales, earnings

CAMDEN – Campbell Soup Co. has reported double-digit increases for sales and earnings for its latest quarter, and the food firm is hoping for more gains.

"Our fiscal year's off to a fast start," Mark Clouse, Campbell's president and CEO, said in announcing first quarter results on Wednesday.

At the same time, he acknowledged, “The environment does remain challenging.”

Campbell said first-quarter net sales rose 15 percent to $2.6 billion “due to inflation-driven pricing, brand strength and continued supply recovery.”

Reported earnings before interest and taxes (EBIT) rose by 16 percent to $436 million. Reported earnings per share posted a 15 percent gain in the quarter ended Oct. 30.

Reported earnings per share rose by 15 percent to 99 cents.

Clouse noted the firm has raised its guidance for fiscal 2023 “based on strong first-quarter results, sustained brand momentum and strengthened supply chain.”

“This is perhaps one of the most complete quarters we’ve delivered,” said Clouse.

The “strong” performance reflected improved execution across the company’s supply chain, Clouse said.

“The team has done an excellent job navigating inflation,” he added, noting a combination of “pricing actions and productivity improvements.”

Among other observations, Clouse noted Campbell expects to benefit as inflation-weary consumers choose to eat at home due to higher costs for restaurant meals.

"With consumers preparing about 80 percent of meals from home, our brands are well-positioned for sustained growth, " he said.

Clouse also noted consumers are using cooking skills gained during stay-at-home conditions during the early stage of the pandemic, which had also spurred sales of Campbell’s meal-building products.

Both of Campbell's principal units - Meals & Beverages and Snacks - did well in the latest quarter.

Net sales rose 15 percent and operating earnings jumped 18 percent for the Meals & Beverages unit, which sells soup, Prego sauces and other products.

The Snacks unit also saw a 15 percent gain in net sales, driven by increased demand for Goldfish crackers, Snyder’s of Hanover pretzels and Cape Cod potato chips. The unit’s operating earnings rose 20 percent.

In revising its guidance, Campbell now forecasts a company-wide increase for net sales of 7 to 9 percent. The previous outlook had forecast a 4 to 6 percent gain.

Adjusted EBIT is expected to rise by 2.5 percent to 6.5 percent, up from a previous outlook for gains of 1 percent to 5 percent.

An expected gain in adjusted EPS went to 2 to 5 percent, up from 0 percent to 4 percent.

Campbell also noted it had achieved $10 million of total savings in the last quarter under its multi-year cost savings program. That brought total savings from the program to $860 million.

“Campbell remains on track to deliver savings of $1 billion by the end of fiscal 2025,” the company said in a statement.

Jim Walsh is a senior reporter with the Courier-Post, Burlington County Times and The Daily Journal