UPDATE 2-Campbell Soup cuts forecast as U.S. soup sales slide
(Adds forecast, analysts' comments; updates shares)
Nov 19 (Reuters) - Campbell Soup Co, the world's largest soup maker, cut its full-year profit forecast on Tuesday after a drop in demand for its soups and drinks resulted in first-quarter earnings that fell far short of analyst estimates.
Campbell, whose shares slid as much as 9 percent before the bell, said U.S. soup sales fell 6 percent and drinks sales 8 percent in the quarter ended Oct. 27.
Sales in the company's international "simple meals" and beverage business fell 13 percent.
The company cut its full-year adjusted earnings forecast to between $2.53 and $2.58 per share from $2.55-2.60.
"I'm disappointed in Campbell's first-quarter performance," Chief Executive Denise Morrison said in a statement.
"This was a disappointing quarter by almost any read, in our opinion," J.P. Morgan Securities analyst Ken Goldman said.
Both Goldman and KeyBanc analyst Akshay Jagdale said they were surprised the company did not cut its forecast even more.
Campbell, whose brands include Prego pasta sauces and Pepperidge Farm cookies, is trying to move away from its traditional business and into fast-moving perishable goods after several seasons of weak soup sales.
It is also revamping its offerings with new varieties of soups and sauces and has stepped up its advertising.
First-quarter net earnings attributable to the company fell to $172 million, or 54 cents per share, from $245 million, or 78 cents per share, a year earlier.
On an adjusted basis, the company earned 63 cents per share, missing the average analyst estimate of 86 cents.
Net sales fell 2 percent to $2.17 billion, below Wall Street's average forecast of $2.29 billion.
Sales in the U.S. simple meals business, which includes soups and sauces, fell 4 percent to $860 million. The company did not provide a value figure for U.S. soup sales other than to note the 6 percent decline.
U.S. beverage sales, which includes V8 vegetable juices, fell to $173 million from $189 million.
Campbell's shares were down 5.5 percent at $39.50 before the opening.
(Reporting by Aditi Shrivastava in Bangalore; Editing by Joyjeet Das and Ted Kerr)