Costs linked to Campbell Soup Co.’s restructuring programme have hit the firm’s full-year earnings.
For the year to the end of July, the US food giant earned US$805m, a 4.6% decline on the year before.
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In June, Campbell announced a series of measures to reduce costs at the company, including plans to close a plant in the US and leave the Russian market.
Campbell’s full-year EBIT slid 5.2% to $1.28bn. The company blamed the decline on lower earnings from its US simple meals and beverages divisions.
Sales increased 1% $7.72bn, thanks, Campbell said to “price and sales allowances” and a benefit from foreign exchange. Campbell said “volume and mix” fell 1%.
In the fourth quarter, Campbell earned $100m against $113m in the comparable period last year. EBIT also dropped, by 9.6% to $169m. Sales climbed 6% to $1.61bn.
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By GlobalDataCampbell president and CEO Denise Morrison, said the company was pleased to be “finishing a very difficult fiscal year with some positive momentum and a new strategic direction”.
“Fiscal 2012 will be a year of transition, as we build the foundation for a new Campbell with a renewed focus on meeting consumers’ needs,” Morrison said. “Implementing our new strategic framework will require substantial investment as we extend brand and product platforms through more consistent innovation in simple meals, baked snacks and healthy beverages, reinvigorate consumer marketing activities and drive international expansion in priority markets.”
Campbell said its annual results were “slightly ahead” of the forecasts it made in July. Consequently, the company changed its guidance for the current financial year.
It still expects net sales to be flat or to grow by up to 2%. However, it now expects adjusted EBIT of to fall by 7-9%, compared to its July forecast of a decrease of 6-8%. Campbell said it now forecasts a drop in adjusted EPS of 5-7% from the adjusted base of $2.54. In July, it predicted a fall of 4-6%.
Shares in Campbell were up 0.68% at $30.92 at 10:22 ET.
Click here for the full statement from Campbell.
