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In a release on May 21, the company stated:
Excluding items impacting comparability, adjusted net earnings were $171 million in the current quarter compared to adjusted net earnings of $165 million in the prior year's quarter. Adjusted net earnings per share were $0.48 in the current quarter compared to adjusted net earnings per share of $0.43 in the prior year's quarter, an increase of 12 percent. Reflecting a stronger U.S. dollar, adjusted net earnings per share for the quarter were negatively impacted by $0.04 due to currency translation.
Douglas R. Conant, Campbell's President and Chief Executive Officer, said, "We delivered strong earnings growth this quarter. Reflecting our previous pricing actions and ongoing productivity improvements, gross margin performance improved versus the prior year, as expected. Following increased spending in the first half to launch new products, we reduced marketing expenses, as planned, particularly in U.S. Soup.
"Despite softer sales in the quarter, year to date we've delivered one of the strongest U.S. Soup sales performances in years, with sales up 6 percent. Consumers continued to view soup as a simple, nourishing and affordable meal. In particular, condensed cooking soups provided strong growth, as our value marketing message resonated with consumers. We also are pleased with the introduction and ongoing performance of 'Campbell's Select Harvest' and 'Campbell's' 'V8' ready-to-serve soups and 'Swanson' stock."
Conant continued, "Beyond U.S. Soup, our Sauces business turned in a stellar quarter with double-digit sales growth and very strong earnings growth. Pepperidge Farm also delivered double-digit sales gains in 'Goldfish' snack crackers and 'Milano' cookies. On the other hand, our beverage and North America Foodservice businesses have been negatively impacted by the poor economy.
"Internationally, we delivered solid performance in Asia Pacific, behind double-digit sales gains in the Australian soup business. However, our European business declined in the face of a very challenging operating environment. In emerging markets, we continued to build our capabilities in Russia and China."
Conant concluded, "We are successfully managing our way through the challenging economic conditions, we are gaining momentum in our key areas of focus and we are on track to deliver solid full-year results."
Fiscal 2009 Guidance
On a currency neutral basis, the company expects to deliver sales growth, excluding the negative impact of one less week in the fiscal year and divestitures, within its long-term target range of between 3 and 4 percent; adjusted earnings before interest and taxes (EBIT) growth slightly below its long-term growth target of between 5 and 6 percent, reflecting the impact of one less week, higher marketing spending and increased investment spending in Russia and China. On a currency neutral basis, Campbell now expects growth in adjusted net earnings per share (EPS) to exceed the 5 to 7 percent range from the fiscal 2008 adjusted base of $2.09.
The company expects its fiscal 2009 sales, EBIT and EPS growth rates will be negatively impacted by approximately 5 percentage points as a result of currency translation.
Campbell Soup Company is a global manufacturer and marketer of foods and simple meals, including soup, baked snacks, and healthy beverages.
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