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Campbell Soup's shares slide as it reports worse-than-expected quarterly earnings

Campbell Soup shares dropped as it cut its full year sales guidance and posted a fall in third quarter earnings
Campbell Soup says it was challenging quarter across the food industry

Campbell Soup Company (NYSE:CPB) reported worse-than-expected quarterly earnings and sales, blaming a weak consumer spending.

Shares fell 4.48% to US$54.17 in early trading. 

The canned soup maker posted adjusted earnings per share (EPS) in the third quarter of US$0.56, falling from US$0.65 in the year-ago period and missing analysts’ estimates of US$0.64.

Net income fell to US$176mln from US$185mln.

Sales dipped to US$18.5bn from US$1.87bn, below market expectations for an unchanged figure, as growth in its global biscuits and snacks division was offset by declines in the Americas Simple Meals and Beverages and Campbell Fresh categories.

Chief executive Denise Morrison said: “This was a challenging quarter across the food industry as top-line growth remained scarce, especially in centre store categories.

“The industry, including Campbell, experienced significant consumption declines early in the calendar year. These industry trends coincided with weak consumer spending, which was at its lowest growth rate since 2009. While we rebounded with sales growth in March and April, we were unable to offset the earlier declines.”

Campbell revised its guidance for the full year, saying it expects sales to drop by 1% to 0% compared to previously estimated gain of 0% to 1%. It predicts adjusted EPS to rise by 3% to 5%.

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Campbell Soup Company Timeline

September 04 2012

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