Vending

Campbell Soup lifts Q4, FY 2023 results boosted by pricing

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August 31, 2023

Campbell Soup Co. lifted its Q4 and FY 2023 results boosted in part by price inflation, according to a press release, surpassing analyst quarterly revenue expectations. Highlights include:

• Net sales increased 4% from $1.9.8 billion in Q4 2022 to $2.07 billion in the quarter ending July 30, 2023. Organic net sales increased 5% to $2.1 billion as the impact of inflation-driven net price realization of 10% was partially offset by some unfavorable volume/mix of 5%.
• Net earnings rose from $69 million to $169 million in the comparative quarters.
• Reported EPS increased from 32 cents to 57 cents.
• Adjusted EPS decreased 11% from 56 cents to 50 cents primarily reflecting the decrease in adjusted EBIT and slightly higher interest expense, partially offset by a lower adjusted effective tax rate and a reduction in the weighted average diluted shares outstanding.
• Meals and beverage sales increased from $935 million to $936 million.
• Snack sales rose 8% from $1.05 billion to $1.13 billion.
• Meals and beverages earnings fell 18% from $161 million to $132 million.
• Snack earnings rose 12% from $141 million to $158 million.
• Full year net sales increased 9% from $8.56 billion in 2022 to $9.36 billion, as organic net sales increased 10% to $9.4 billion with the benefit of inflation-driven net price realization more than offsetting unfavorable volume/mix.
• Full year net earnings rose from $757 million to $858 million.
• Full year reported EPS increased from $2.51 to $2.87.
• Fiscal 2023 diluted EPS increased from $2.51 to $2.85 primarily reflecting the increase in adjusted EBIT and a reduction in the weighted average diluted shares outstanding, partially offset by a higher adjusted effective tax rate.
• Full year meals and beverages sales rose 7% from $4.6 billion to $4.9 billion.
• Full year snack sales rose 13% from $3.95 billion to $4.45 billion.

The $2.07 in quarterly revenue beat analyst expectations by $10 million and the non-GAAP EPS of 50 cents was in line with analyst expectations, according to Seeking Alpha.

"We delivered a strong fiscal 2023 with both top and bottom-line growth, exceeding our initial expectations and demonstrating momentum against our strategic plan," Mark Clouse, president and CEO, said in the press release. "Looking ahead, we see fiscal 2024 as another year of sustained growth and continued progress against our strategic plan. We expect accelerated growth and margin improvement in snacks, and sequential and steady improvement in meals and beverages throughout the year, and with the pending strategic acquisition of Sovos Brands, Campbell will be one of the most dependable, growth-oriented names in food."

The pending acquisition of Sovos Brands is currently expected to close by the end of December 2023 and is not included in Campbell's current fiscal 2024 outlook.

Net sales volume declines are expected in the first half of fiscal 2024 with sequential improvement throughout the fiscal year leading to positive trends in the second half.

Adjusted EPS is expected to rise from 3%-5% to a range of $3.09-$3.15.

Shares traded today at $42.60 against a 52-week range of $41.56 to $57.78.