Campbell Soup Beats Earnings Estimates, Q2 Net Sales Rise 24%
On Wednesday, Campbell Soup Co. reported better-than-expected adjusted earnings, helped by its acquisitions of Snyder's-Lance and Pacific Foods.
Excluding items, the company earned 77 cents a share in the second quarter ended 27 January, beating the average analyst estimate of 70 cents, according to Refinitiv data.
Net sales rose by 24%, to $2.71 billion (€2.38 billion), while organic sales were flat.
Acquisitions And Divestments
In 2017, Campbell agreed to buy pretzel- and Cape Cod crisp-maker Snyder's-Lance, Inc. for $4.87 billion (€4.28 billion) and organic soup-maker Pacific Foods for $700 million (€615.45 million).
Like other packaged-food companies, Campbell has been struggling to attract young, increasingly health-conscious consumers.
It has tried to make its portfolio healthier, launching a cost-cutting and divestment plan in August.
Campbell reported a net quarterly loss, hurt by higher restructuring costs, and a $346 million (€303.64 million) write-down of its troubled fresh-food business.
This is the fourth time that Camden, New Jersey-based Campbell has written down the value of its fresh unit since September 2016, knocking about $1.35 billion (€1.18 billion) off its value in total.
The unit, which was put up for sale in August, after a months-long strategic review, includes Bolthouse Farms.
The business has struggled in recent years, with issues ranging from farming missteps to the recall of 3.8 million bottles of protein shakes.
On Tuesday, Campbell reported that it expects to name buyers for Bolthouse and its international business by the end of its fiscal year, in July.
The company also reported that it had agreed to sell salsa-maker Garden Fresh Gourmet to a unit of Fountain of Health USA, which makes hummus, dips and prepared salads. Terms of the deal were not disclosed.
Sources told Reuters in December that the Kraft Heinz Co. and Mondeléz International, Inc. were among those bidding for Campbell's international business, which includes Australian biscuit brand Arnott's and Danish baked snack-maker Kelsen Group.
The net loss attributable to Campbell was $59 million (€51.78 million), or 20 cents per share, compared with earnings of $285 million (€250.11 million), or 95 cents per share, a year earlier.