Baking and snacking earnings up at Campbell in '11

by Eric Schroeder
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CAMDEN, N.J. — Operating earnings within the Global Baking and Snacking division (previously known as Baking and Snacking) of the Campbell Soup Co. were $355 million in the year ended July 31, up 10% from $322 million in fiscal 2010. Campbell said the increase in earnings reflected the impact of currency and volume-driven growth at both Pepperidge Farm and Arnott’s.

Sales rose 9% to $2,156 million, which compared with $1,975 million in fiscal 2010. Currency added 5 percentage points to the growth, volume and mix added 3 percentage points, and price and sales allowances added 2 points. Increased promotional spending subtracted 1 point.

“Sales at Pepperidge Farm increased, reflecting higher selling prices and volume gains,” Campbell said. “In cookies and crackers, sales increases were fueled by solid gains in Goldfish snack crackers, the launch of Milano Melts cookies and growth in Chocolate Chunk Crispy cookies.

“Sales of fresh bakery products were comparable to the prior year. Sales of frozen products increased, driven by gains in Garlic Toast and the launch of Artisan Stone Baked rolls. Sales at Arnott’s increased due to currency and sales gains in savory crackers, led by Shapes and Tim Tam chocolate biscuits.”

For the fourth quarter ended July 31, operating earnings within the Global Baking and Snacking business unit were $92 million, up 26% from the same period a year ago. Sales totaled $559 million, up 17% from $479 million.

“Our Global Baking and Snacking segment delivered strong performance with double-digit top- and bottom-line growth in the quarter,” said Denise Morrison, president and chief executive officer.

Overall, Campbell Soup Co. posted earnings of $805 million in fiscal 2011, equal to $2.44 per share on the common stock, down 5% from $844 million, or $2.44 per share, in fiscal 2010. The lower results reflected a series of initiatives that were announced in late June to improve the company’s supply chain efficiency and reduce overhead costs, as well as plans to close the company’s Moscow office and exit the Russian market. Net sales were $7,719 million, up narrowly from $7,676 million in the same period a year ago.

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