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Campbell Soup Profit Up 39%, but Lower than Expected

Campbell Soup on Thursday said its earnings rose 39 percent for the fourth quarter, versus results a year ago that reflected costs related to sales of some European operations.

But its profit from continuing operations fell 37 percent in the latest quarter.

The food company's shares fell $1.06, or 2.8 percent, to $36.94 in morning trading Thursday.

Campbell earned $61 million, or 16 cents per share, in the three months ended July 29, versus a profit of $44 million, or 11 cents per share, a year ago.

But when operations it no longer owns are excluded from the comparison, Campbell earned $53 million, or 14 cents per share, down from $84 million, or 20 cents per share, a year ago.

Its revenue rose to $1.59 billion from $1.45 billion in the same period in 2006.

Soup sales were flat; condensed soup sales rose a bit, but ready-to-serve soups had a rare sales decline of 4 percent. However, soup sales are generally at their lowest in the fourth quarter, which includes most of the summer season.

The company's fast-growing V8 juice business performed well, with sales up by more than 10 percent. The company expects even more juice sales as a distribution deal with Coca-Cola kicks in this fall.

Sales of Prego pasta sauces and Pace salsa were up, as were Pepperidge Farm breads.

The bottom line was also affected by higher advertising spending.

The company said Thursday that sales in fiscal 2008 were expected to grow above the long-term range of 3 to 4 percent and that earnings per share were still expected to rise between 5 percent and 7 percent.

The higher sales expectations come as the company launches its first major soup-selling forays into the massive markets of China and Russia.

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