World's largest soup-maker Campbell Soup Co. (CPB) reported Friday a 63% year-over-year surge in profit for the fourth quarter despite a marginal decline in sales.
A lower effective tax rate helped lift profits compared to the year-ago quarter, when results were weighed down by a charge.
Adjusted earnings per share for the quarter rose 10%, and topped analyst' expectations by three cents, while quarterly revenues edged down and missed estimates. The company provided earnings and sales forecast for the full-year 2011 below analysts' view.
In a statement, President and CEO Douglas Conant said, "In a challenging year, we delivered strong earnings growth, overcoming softer-than-expected sales, particularly in our U.S. soup business."
The Camden, New Jersey-based company reported net earnings of $113 million or $0.33 per share for the fourth quarter, higher than $69 million or $0.20 per share in the prior-year quarter.
Excluding items, adjusted earnings for the quarter rose to $113 million or $0.33 per share from $107 million or $0.30 per share in the year-ago quarter. On average, 16 analysts polled by Thomson Reuters expected the company to earn $0.30 per share for the fourth quarter. Analysts' estimates typically exclude special items.
Net sales for the quarter decreased about 1% to $1.52 billion from $1.53 billion in the same quarter last year, and missed fourteen Wall Street analysts' consensus estimate of $1.60 billion.
U.S. beverage sales for the quarter increased 12% from last year, driven by significant growth across the entire V8 portfolio. Meanwhile, U.S. soup sales decreased 5% from a year ago, reflecting increased promotional spending.
"By effectively managing our margins in a tough economic environment, we have set the stage for next year and positioned the company for growth through continued innovation, category leading marketing spending and competitive pricing," Conant added.
Although the recession-imposed eat-at-home habit did help food products makers, Campbell had to face stiff competition from lower-priced private labels, forcing the company to look for revenue-generating as well as cost-cutting measures. The high-quality foods and simple meals-maker is tweaking its products lines to induce budget and health-conscious shoppers.
The company's new and improved healthy soups hit the supermarket shelves last month as projected by the company. In February, it revealed plans to enhance more than 60% of its flagship condensed soup line with product improvements, further expand its sodium reduction program, introduce more contemporary packaging, improve shelving systems and introduce new marketing aimed at the simple meals category.
The company also revealed in mid-July that it will step up investments to focus on three large and growing categories: healthy beverages, baked snacks and simple meals. Healthy beverages is also well positioned to capitalize on the health & wellness trend, with increasing number of people turning to beverages as a way to get more vegetables into their diets.
For fiscal 2010, the company reported net earnings of $844 million or $2.42 per share, higher than $736 million or $2.05 per share in the prior year.
Excluding items, adjusted earnings for the year rose to $862 million or $2.47 per share from $794 million or $2.21 per share in the year ago. Analysts expected the company to report earnings of $2.46 per share for fiscal 2010.
Net sales for the full year grew 1% to $7.68 billion from $7.59 billion posted in fiscal 2009. The Street was looking for full-year 2010 revenues of $7.76 billion.
Looking ahead to fiscal 2011, Campbell Soup said it expects adjusted earnings per share to grow in a range of 5% to 7% from the fiscal 2010 adjusted base of $2.47, implying earnings in the range of $2.59 to $2.64 per share. Analysts expect the company to report earnings of $2.65 per share for the full-year 2011.
The company also projects annual revenues to grow 2% to 3% from last year's $7.68 billion, implying revenues between $7.83 billion and $7.91 billion. The Street is currently looking for fiscal 2011 revenues of $7.94 billion.
CPB closed Thursday's regular trading session at $37.32, up $0.35 or 0.95% on a volume of 2.34 million shares, lower than the three-month average volume of 2.56 million shares. In the past 52-week period, the stock has been trading in a range of $30.63 to $37.59.
For comments and feedback contact: editorial@rttnews.com
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.