Baking and snacking earnings fall 12% at Campbell

by Eric Schroeder
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CAMDEN, N.J. — Operating earnings within the Global Baking and Snacking division of the Campbell Soup Co. were $88 million in the first quarter ended Oct. 30, down 12% from $100 million in the same period of fiscal 2011. Campbell said the decrease in earnings reflected lower earnings at Arnott’s, which was affected adversely by the cost of inflation and lower volumes.

Sales rose 4% to $568 million, which compared with $544 million in the first quarter of fiscal 2011. Price and sales allowances added 5 percentage points to growth and currency added 5 percentage points, while volume and mix subtracted 3 percentage points and increased promotional spending subtracted 1 point.

“Sales at Pepperidge Farm increased 5%, reflecting higher selling prices across the portfolio,” the company said. “In cookies and crackers, sales increases were driven by solid gains in Goldfish snack crackers and by the launch of Cracker Chips and Milano Melts cookies, partly offset by declines in Soft-Baked cookies. Bakery sales increased due to gains in Goldfish breads.

Campbell said sales at Arnott’s increased primarily due to currency, partially offset by lower volumes.

“The volume performance was negatively impacted by an increase in promoted and non-promoted price points at retail and a weakening consumer environment in Australia,” Campbell said.

Overall, Campbell Soup Co. posted earnings of $265 million in the first quarter of fiscal 2012, equal to 82c per share on the common stock, down 5% from $279 million, also equal to 82c per share, in the first quarter of fiscal 2011. Net sales were $2,161 million, down 1% from $2,172 million in the same period a year ago.

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