US food company Campbell Soup has reported a 10% increase in first-quarter earnings, helped by strong sales of soup in the US.
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The company reported net earnings of US$230m, or 56 cents per share, for the first quarter to 31 October, compared to $211m, or 51 cents per share, in the year-ago period. Sales rose 10% to $2.1bn; volume and mix added 9%, increased promotional spending subtracted 1% and currency added 2%.
“We are off to a strong start. The significant investments we have made to improve our products, packaging, merchandising, and marketing are beginning to reach critical mass in the marketplace,” said president and CEO Douglas Conant.
“That is particularly true in our US soup business where our condensed and ready-to-serve soups, as well as broth, grew strongly. Our decision to move more of our consumer marketing and trade promotion programmes into the first quarter drove category growth and significant improvement in our competitive profile. Additionally, the introduction of ‘Campbell’s Chunky’ chili has met with very positive customer and consumer acceptance, demonstrating that the Campbell’s brand can compete more broadly in the simple meals arena. We were also pleased to deliver solid growth in our baking and snacking businesses,” Conant added.
Looking ahead, Conant said the company must continue to drive innovation. The company confirmed its fiscal year 2005 guidance for earnings per share to increase 5-7%, excluding restructuring charges, from the adjusted fiscal year 2004 base of $1.58.
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