Campbell Soup (CPB) Shares Catch a Bid as Decline in Q2 Profit Less Than Expected
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Shares of Campbell Soup Company (NYSE: CPB) are trading up 1.4 percent in Thursday's pre-market session as traders are responding to second-quarter results from the maker of America's most popular soup brand.
Net sales decreased 1 percent to $2.112 billion, but were roughly inline with the Street’s consensus of $2.12 billion. Sales for U.S. Beverages were $187 million, a 4 percent increase year over year. International sales in the Simple Meals and Beverages segments were down 5 percent to $402 million.
Marketing and selling expenses increased 2 percent to $297 million, while administrative expenses decreased $2 million to $152 million.
Gross margin was 38.4 percent, compared with 39.4 percent a year ago.
EBIT was $329 million, compared with $359 million in the prior-year quarter. Excluding items impacting comparability, adjusted EBIT in the current quarter was $332 million.
Net earnings were $205 million, or $0.64 per share, compared with $239 million, or $0.71 per share, in the prior year. Adjusted net earnings decreased 13 percent to $207 million, and adjusted net earnings per share decreased 10 percent to $0.64 in the current quarter. This is above the Street’s consensus of $0.62 per share.
“At the midpoint of our fiscal year, we are focused outward on consumers and on executing against our three strategies to return Campbell to sustainable, profitable net sales growth,” reported Denise Morrison, Campbell’s President and Chief Executive Officer. “Six months into our transition, we continue to make progress in stabilizing overall U.S. Soup profits, achieving the fourth consecutive quarter of profit growth for this business. We expect improved sales in the second half, as we continue to shift our emphasis to brand building efforts that will drive consumer usage.”
The company confirmed its previous fiscal 2012 guidance, which calls for net sales growth to be between 0 and 2 percent, a decline in adjusted EBIT of between 9 and 7 percent and a decline in adjusted EPS of between 7 and 5 percent. This implies adjusted EPS in the range of $2.35 to $2.42, compared to the 2011 adjusted base of $2.54. The Street’s consensus is indicates earnings of $2.36 per share on $7.71 billion in net sales.
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Net sales decreased 1 percent to $2.112 billion, but were roughly inline with the Street’s consensus of $2.12 billion. Sales for U.S. Beverages were $187 million, a 4 percent increase year over year. International sales in the Simple Meals and Beverages segments were down 5 percent to $402 million.
Marketing and selling expenses increased 2 percent to $297 million, while administrative expenses decreased $2 million to $152 million.
Gross margin was 38.4 percent, compared with 39.4 percent a year ago.
EBIT was $329 million, compared with $359 million in the prior-year quarter. Excluding items impacting comparability, adjusted EBIT in the current quarter was $332 million.
Net earnings were $205 million, or $0.64 per share, compared with $239 million, or $0.71 per share, in the prior year. Adjusted net earnings decreased 13 percent to $207 million, and adjusted net earnings per share decreased 10 percent to $0.64 in the current quarter. This is above the Street’s consensus of $0.62 per share.
“At the midpoint of our fiscal year, we are focused outward on consumers and on executing against our three strategies to return Campbell to sustainable, profitable net sales growth,” reported Denise Morrison, Campbell’s President and Chief Executive Officer. “Six months into our transition, we continue to make progress in stabilizing overall U.S. Soup profits, achieving the fourth consecutive quarter of profit growth for this business. We expect improved sales in the second half, as we continue to shift our emphasis to brand building efforts that will drive consumer usage.”
The company confirmed its previous fiscal 2012 guidance, which calls for net sales growth to be between 0 and 2 percent, a decline in adjusted EBIT of between 9 and 7 percent and a decline in adjusted EPS of between 7 and 5 percent. This implies adjusted EPS in the range of $2.35 to $2.42, compared to the 2011 adjusted base of $2.54. The Street’s consensus is indicates earnings of $2.36 per share on $7.71 billion in net sales.
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