(RTTNews) - The world's largest soup maker Campbell Soup Co. (CPB: News ) on Monday posted higher profit for the first quarter, reflecting improved gross margins as well as lower costs and expenses. Further, the company raised its fiscal 2010 guidance citing quarterly performance and outlook for the remainder of the year, including currency.

The Camden, New Jersey-based company's first-quarter net income was $304 million or $0.87 per share, compared to $260 million or $0.70 per share in the year-ago quarter.

In the first quarter of 2009, the company recognized in cost of products sold $26 million of unrealized losses on the fair value of open commodity futures contracts. The company also recorded expenses of $7 million in cost of products sold related to the initiatives announced to improve operational efficiency and long-term profitability.

On an adjusted basis, net income advanced 8% to $304 million from $281 million in the comparable quarter of the previous year. Adjusted per share earnings grew 14% to $0.87 from $0.76 per share in the three months ended November 2, 2008.

On average, 15 analysts polled by Thomson Reuters expected the company to post earnings of $0.81 per share. Analysts' estimates typically exclude special items.

The company noted that it adopted and retrospectively applied new accounting guidance related to the calculation of earnings per share in the most recent quarter. The retrospective application of these provisions resulted in a reduction of net earnings per share of $0.01 for both the first quarter and the full year.
Meanwhile, net sales for the latest quarter declined 2% to $2.20 billion from $2.25 billion in the previous year, and fell shy of the $2.28 billion revenue consensus estimate of ten analysts polled by Thomson Reuters.

Douglas Conant, President and Chief Executive Officer of Campbell, said, "We feel good about our performance in the first quarter as we delivered solid earnings growth across all of our key businesses. We're especially pleased with the significant improvement in our gross margin, driven by increased productivity in our supply chain. Our U.S. Soup business faced difficult top-line comparisons with last year's first quarter when sales increased 12 percent."

The company's U.S. Soup, Sauces and Beverages segment contributed sales of $1.140 billion, down 5% from the previous year's sales of $1.198 billion. During the recent quarter, sales of "Campbell's" condensed soups dropped 1% following 14% growth a year ago. Sales of ready-to-serve soups decreased 7%. Declines in "Campbell's Select Harvest" canned soups and double-digit declines in soups in microwavable bowls and cups were partly offset by gains in "Campbell's Chunky" canned soups.

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