Campbell baking unit benefits from innovation

by Eric Schroeder
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CAMDEN, N.J. — Stepped-up innovation and growth at Pepperidge Farm helped drive operating earnings within the Global Baking and Snacking division of the Campbell Soup Co. For the second quarter ended Jan. 27, earnings totaled $74 million, up 4% from $71 million in the same period of fiscal 2012.

Sales rose 7% to $561 million, which compared with $526 million in the same period a year ago. Volume and mix added six percentage points while price and sales allowances added one percentage point and currency added one point. Higher promotional spending subtracted one point.

For the first half of fiscal 2013, earnings in the segment were $159 million, unchanged from the same period of fiscal 2012, while sales increased 4% to $1,135 million from $1,094 million.

“Sales of Pepperidge Farm products increased, primarily driven by volume gains, partially offset by increased promotional spending,” the company said. “In cookies and crackers, sales increases were driven by strong gains in Goldfish snack crackers and the national launch of Jingos! adult savory crackers, as well as improved performance in cookies, which benefited from a successful holiday period. Sales of fresh bakery products increased versus the prior year, driven by volume gains across most of the portfolio.”

Campbell said sales at Arnott’s increased driven by growth in Australia and gains in Indonesia. Sales growth in Australia occurred in all categories — savory crackers, chocolate cookies and sweet varieties.

For the quarter ended Jan. 27, Campbell Soup Co. had earnings of $190 million, equal to 61c per share on the common stock, which compared with earnings of $205 million, or 64c per share, during the same quarter of the previous year. Sales for the quarter were $2,333 million, up 10% from $2,112 million.

For the six months ended Jan. 27, the company as a whole had earnings of $435 million, or $1.39 per share, down 7% from $470 million, or $1.46 per share, during the same period of the previous year. Sales for the period were $4,669 million, up 9% from $4,273 million.

The company is expecting adjusted earnings per share for fiscal 2013 to be in the range of $2.51 and $2.57.
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