Campbell Posts Higher Profit, Raises Quarterly Outlook
Campbell Soup Monday posted higher-than-expected quarterly profit, boosted by price increases, sales of new products like lower-sodium soups and strength in its V8 vegetable juice business.
The company also raised its quarterly earnings forecast, and its stock rose in early trading.
Campbell, which also makes Godiva chocolate and Pepperidge Farm baked goods, said profit increased to $217 million, or 55 cents a share, in the third quarter ended April 29 from $166 million, or 40 cents a share, a year earlier.
Excluding one-time items, Campbell said earnings were 45 cents a share. Analysts on average forecast 41 cents, according to Thomson Financial.
Sales rose 8 percent to $1.87 billion, exceeding the analysts' average estimate of $1.79 billion. The weaker U.S. dollar, which lifts the value of international sales, accounted for 2 percentage points of the increase.
Campbell has used a combination of price increases and productivity improvements to help offset higher commodity costs. At the same time, it has been developing more new products, like the lower-sodium soups, to help boost sales by tapping into trends toward healthier eating.
Campbell shares rose to $40.25 on Monday in premarket electronic trading from Friday's close of $39.50 on the New York Stock Exchange. The stock traded at about 18.7 times next year's estimated earnings at Friday's close, toward the middle of the range of multiples in the Standard & Poor's Packaged Foods index.