Vending

Campbell Soup boosts Q1 2023 results, surpasses expectations

Image provided by Campbell Soup Co.

December 7, 2022

Campbell Soup Co. increased its net and organic sales 15% in Q1 2023, due to inflation-driven pricing, brand strength and continued supply recovery, according to an earnings release. The company surpassed analyst expectations and raised its full year expectations.

Highlights include:

• Net sales rose 15% from $2.24 billion in Q1 2022 to $2.58 billion in the quarter ending Oct. 30, 2022.
• Net earnings rose from $261 million to $297 million in the comparative quarters.
• Reported earnings per share increased 15% from 86 cents to 99 cents, while adjusted EPS increased 15% from 89 cents to $1.02.
• Net sales for meals and beverages, both reported and organic, increased 15% in the quarter primarily due to increases in U.S. retail products, including U.S. soup and Prego pasta sauces, as well as gains in foodservice. Inflation-driven pricing and sales allowances and lower levels of promotional spending were partially offset by volume declines. Sales of U.S. soup increased 11% due to sales increases in ready-to-serve soups, condensed soups and broth.
• Net sales for snacks, both reported and organic, increased 15% driven by sales of power brands, which were up 21%. Sales growth was driven by increases in cookies and crackers, primarily Goldfish crackers, and in salty snacks, primarily Snyder's of Hanover pretzels, and both Kettle Brand and Cape Cod potato chips. Inflation-driven pricing and sales allowances were partly offset by volume declines and increased promotional spending relative to moderated levels in the prior-year quarter.

Shares traded today at $55.28 against a 52-week range of $40.99-$55.51.

The $2.58 billion in quarterly revenue beat analyst expectations by $140 million while the non-GAAP EPS of $1.02 beat expectations by 15 cents, according to Seeking Alpha.

"Through a combination of inflation-driven pricing actions and productivity improvements, we have substantially mitigated significant inflationary pressure in the quarter while continuing to provide quality and value to consumers," Mark Clouse, president and CEO, said in the press release. "With the momentum of our strong first-quarter performance and confidence in our strengthened supply chain, we are raising our full-year fiscal 2023 guidance while taking into account the volatile economic environment."

For 2023, the company expects sales growth between 7% and 9% compared to the prior expectation of 4% to 6%, while the adjusted EPS is expected to be $2.90 to $3.00 compared to the prior expectation of $2.85 to $2.95.