Campbell Soup Q2 Profit Surges, Confirms Full-year Outlook

(RTTNews) - World's largest soup maker Campbell Soup Co. (CPB) Friday reported a sharp increase in second-quarter profit, as sales grew 6 percent driven by its core business and acquisition of Kelsen Group. The company also confirmed its fiscal 2014 guidance.

Denise Morrison, Campbell's president and chief executive officer said, "We remain focused on strengthening our core business and expanding into higher-growth spaces as we reshape our portfolio to improve Campbell's long-term growth trajectory."

Campbell said it still faces some challenges in U.S. Beverages and Australia, but has taken steps to strengthen these businesses.

For the second quarter, net earnings attributable to the company climbed to $325 million or $1.03 per share from $190 million or $0.60 per share in the same quarter last year.

Earnings from continuing operations were $0.74 per share, higher than $0.54 per share a year ago. Adjusted earnings per share from continuing operations were $0.76, compared to $0.64 per share last year.

For the recent period, adjusted net earnings per share attributable to the company totaled $1.04, while it posted $0.70 per share a year earlier.

On average, 17 analysts polled by Thomson Reuters expected earnings per share of $0.73 for the quarter. Analysts' estimates typically exclude one-time items.

During the quarter, Campbell and its joint venture partner Swire Pacific Ltd. agreed to restructure manufacturing and streamline operations for its soup business in China. The company recorded pre-tax restructuring charges of $13 million related to this initiative.

Net sales for the quarter grew 6 percent to $2.28 billion from $2.16 billion a year ago. Thirteen analysts estimated revenues of $2.27 billion for the quarter. Organic sales growth was 3 percent.

Sales for U.S. Simple Meals increased 7 percent from last year. Global Baking and Snacking sales were up 14 percent, which included the acquisition of Kelsen Group. Meanwhile, U.S. Beverages sales declined 3 percent from the preceding year.

For fiscal year 2014, the company still expects adjusted earnings to grow by 2 to 4 percent to $2.53 to $2.58 per share, on projected sales growth of 4 to 5 percent. Street is currently looking for fiscal 2014 earnings of $2.51 per share.

According to the firm, fiscal 2014 guidance includes benefits of a 53rd week, acquisitions, estimated impact of currency translation and impact of presenting revenue on a net basis in connection with its new business model in Mexico.

CPB closed Thursday's regular trading session at $40.97. In the pre-market activity on Friday, the shares are up 5.81 percent.