- Fourth-Quarter Loss Per Share from Continuing Operations of
$0.02
- Fourth-Quarter Net Sales and Organic Sales from Continuing
Operations Increased 2 Percent
- Campbell International Reported as Discontinued Operations
- Fourth-Quarter Results Comprising Continuing Operations and
Campbell International (as Previously Guided) were: Net Sales of
$2.024 Billion; Adjusted Earnings Per Share (EPS) of $0.50
- Campbell Provides Fiscal 2020 Guidance for Continuing
Operations
Campbell Soup Company (NYSE:CPB) today reported its
fourth-quarter and full-year results for fiscal 2019.
CEO Perspective
Mark Clouse, Campbell’s President and CEO, stated, “Our strong
fourth-quarter results culminated a year of steady, positive
performance for Campbell. We delivered consistent results and met
or exceeded expectations for four consecutive quarters this year.
We made significant progress against our 2019 strategic
initiatives, namely: improving our in-market performance;
overdelivering our cost savings programs; strengthening our
relationships with key retailers; focusing the portfolio on our two
core businesses in North America; and, completing the divestiture
of Campbell Fresh and announcing the divestiture of Campbell
International. We have created a solid foundation to build upon in
fiscal 2020.”
Presentation of Results
On July 12, 2019, the company announced that it entered into an
agreement to sell the Kelsen Group and on August 2, 2019, that it
entered into an agreement to sell Arnott’s and certain of
Campbell’s International operations. These transactions are
expected to close in the first half of fiscal 2020. This portfolio
of businesses referred to as Campbell International, which was
previously included in the Global Biscuits and Snacks segment, is
now reported as discontinued operations along with Campbell Fresh.
Effective as of the fourth quarter of fiscal 2019, Campbell is
reporting operating results in two segments: Meals & Beverages;
and Snacks. A detailed description of the segments is included at
the end of this news release.
The following table is a summary of the fourth-quarter and
full-year results for sales, earnings before interest and taxes
(EBIT) and EPS from continuing operations and EPS for total
company. For ease of comparison to the company’s most recent fiscal
2019 sales and earnings guidance, the company has also provided
results for sales, EBIT and EPS from continuing operations and the
results of Campbell International that this quarter the company is
referring to as Combined Results. Total Company Results listed
below include continuing and discontinued operations. Prior-year
results have been adjusted to conform to the current-year
presentation. A detailed reconciliation of the reported (GAAP)
financial information to the non-GAAP information is included at
the end of this news release.
Three
Months Ended
Twelve
Months Ended
($ in millions, except per share)
Jul. 28, 2019
Jul. 29, 2018
% Change
Jul. 28, 2019
Jul. 29, 2018
% Change
Continuing
Operations
Net Sales as Reported (GAAP)
$1,780
$1,745
2%
$8,107
$6,615
23%
Organic
2%
-%
EBIT as Reported (GAAP)
$83
$252
(67)%
$979
$1,010
(3)%
Adjusted EBIT
$252
$250
1%
$1,266
$1,252
1%
Diluted Earnings Per Share:
As Reported (GAAP)
($0.02)
$0.42
n/m
$1.57
$2.40
(35)%
Adjusted EPS
$0.42
$0.37
14%
$2.30
$2.51
(8)%
Combined Results
(Continuing Operations and Campbell International)
Combined Net Sales
$2,024
$1,992
2%
$9,153
$7,735
18%
Adjusted Combined EBIT
$288
$282
2%
$1,422
$1,433
(1)%
Adjusted Combined Diluted EPS
$0.50
$0.44
14%
$2.63
$2.90
(9)%
Total Company
Results
Diluted Net Earnings Per Share:
As Reported (GAAP)
($0.03)
$0.31
n/m
$0.70
$0.86
(19)%
Adjusted Net EPS
$0.49
$0.25
96%
$2.62
$2.87
(9)%
n/m – not meaningful
Fourth-Quarter Results from Continuing Operations
Sales increased 2 percent to $1.8 billion driven by gains in
Snacks, as well as Meals & Beverages.
Gross margin increased from 31.4 percent to 34.0 percent.
Excluding items impacting comparability, adjusted gross margin
increased 0.6 percentage points to 33.7 percent. The increase in
adjusted gross margin was driven primarily by supply chain
productivity improvements, the benefits from cost savings
initiatives and the favorable impact from lapping costs associated
with the July 2018 voluntary recall of Flavor Blasted Goldfish
crackers, partly offset by cost inflation.
Marketing and selling expenses increased 10 percent to $195
million driven primarily by increased marketing investment on
Snacks and higher incentive compensation, partly offset by benefits
of cost savings initiatives. Administrative expenses increased 4
percent to $166 million. Excluding items impacting comparability,
adjusted administrative expenses increased 5 percent to $139
million primarily due to higher incentive compensation expense,
partly offset by the benefits from cost savings initiatives.
Other expenses were $128 million as compared to income of $66
million in the prior year. Excluding items impacting comparability,
other income increased from $3 million in the prior year to $10
million.
As reported EBIT was $83 million. Excluding items impacting
comparability, adjusted EBIT increased 1 percent to $252 million as
sales gains and gross margin improvement were partly offset by
higher marketing and selling expenses.
Net interest expense was $84 million compared to $89 million in
the prior year. Tax expense decreased from $37 million in the prior
year to $4 million. Excluding items impacting comparability, the
adjusted tax rate decreased 4.2 percentage points from 29.8 percent
to 25.6 percent reflecting a lower U.S. federal tax rate.
The company reported a loss from continuing operations of $0.02
per share. Excluding items impacting comparability, adjusted EPS
from continuing operations increased 14 percent to $0.42 per share
primarily reflecting a lower adjusted tax rate.
Full-Year Results from Continuing Operations
Sales increased 23 percent to $8.1 billion reflecting the
benefit from the acquisitions of Snyder’s-Lance and Pacific Foods.
Organic sales were comparable to the prior year.
As reported EBIT decreased 3 percent to $979 million. Excluding
items impacting comparability, adjusted EBIT increased 1 percent to
$1.266 billion reflecting incremental earnings from the
acquisitions mostly offset by declines in the base business.
The company reported EPS from continuing operations of $1.57 per
share. Excluding items impacting comparability, adjusted EPS from
continuing operations decreased 8 percent to $2.30 per share
reflecting higher adjusted net interest expense, partly offset by a
lower adjusted tax rate.
Cash Flow Results
Cash flow from operations increased to $1.4 billion from $1.3
billion a year ago due primarily to significant improvements from
the company’s working capital management efforts. In line with the
company’s commitment to returning value to shareholders, the
company paid $423 million of cash dividends in fiscal 2019
reflecting the quarterly dividend rate of $0.35 per share.
Fiscal 2020 Guidance for Continuing Operations
As shown in the table below, the company expects net sales to
grow by 1 to 3 percent, adjusted EBIT to grow by 2 to 4 percent and
adjusted EPS to grow by 9 to 11 percent. Fiscal 2020 comprises 53
weeks, one additional week compared to fiscal 2019. The benefit of
the 53rd week is included in the fiscal 2020 guidance and is
estimated to be worth 2 points of net sales, adjusted EBIT and
adjusted EPS. Expected net proceeds of approximately $3 billion
from the divestitures of Campbell Fresh and Campbell International
are being used to reduce debt. This guidance takes into account the
impact of the paydown on the company’s interest expense in fiscal
2020.
Continuing Operations
2019
Results
2020
Guidance
($ in millions, except per share)
Net Sales
$8,107
+1 to +3%
Adjusted EBIT
$1,266*
+2 to +4%
Adjusted EPS
$2.30*
+9 to +11%
$2.50 to $2.55
* Adjusted – refer to the detailed reconciliation of the
reported (GAAP) financial information to the adjusted financial
information at the end of this news release.
Note: A non-GAAP reconciliation is not provided for 2020
guidance as certain amounts are not estimable, such as pension and
postretirement mark-to-market adjustments, and these items are not
considered to reflect the company's ongoing business results.
Cost Savings Program from Continuing Operations
In the fourth quarter of fiscal 2019, Campbell achieved $45
million in savings under its multi-year cost savings program,
inclusive of Snyder’s-Lance synergies, bringing total
program-to-date savings to $560 million. Total fiscal 2019 savings
of $165 million were ahead of expectations, helping to offset other
cost pressures. As previously announced, Campbell is targeting
cumulative annualized savings of $850 million by the end of fiscal
2022.
Segment Operating Review
An analysis of net sales and operating earnings by reportable
segment follows:
Three
Months Ended Jul. 28, 2019
($ in millions)
Meals & Beverages
Snacks
Total
Net Sales, as Reported
$813
$967
$1,780
Volume and Mix
-%
3%
1%
Price and Sales Allowances
1%
1%
1%
Promotional Spending
-%
-%
-%
Organic Net Sales
1%
4%
2%
Currency
-
-%
-%
% Change vs. Prior Year
-%*
3%*
2%
Segment Operating Earnings
$151
$133
% Change vs. Prior Year
(3)%
2%
* Numbers do not add due to rounding.
Note: A detailed reconciliation of the reported (GAAP) net sales
to organic net sales is included at the end of this news
release.
Twelve
Months Ended Jul. 28, 2019
($ in millions)
Meals & Beverages
Snacks
Total
Net Sales, as Reported
$4,322
$3,784
$8,107**
Volume and Mix
(1)%
3%
-%
Price and Sales Allowances
-%
-%
-%
Promotional Spending
(1)%
1%
-%
Organic Net Sales
(2)%
3%*
-%
Currency
-%
-%
-%
Acquisitions
2%
61%
23%
% Change vs. Prior Year
-%
64%
23%
Segment Operating Earnings
$903
$514
% Change vs. Prior Year
(9)%
34%
* Numbers do not add due to rounding.
** Includes Corporate
Note: A detailed reconciliation of the reported (GAAP) net sales
to organic net sales is included at the end of this news
release.
Meals & Beverages
Sales in the quarter of $813 million were comparable to the
prior year. Organic sales increased 1 percent reflecting solid
performance in U.S. soup, Prego pasta sauces and Pace Mexican
sauces, partly offset by declines in V8 beverages. Sales of U.S.
soup increased 3 percent as gains in ready-to-serve and condensed
soups were offset by declines in broth.
Segment operating earnings in the quarter decreased 3 percent to
$151 million. The decrease was driven primarily by cost inflation
and higher incentive compensation expense, partly offset by supply
chain productivity gains, the benefits of cost savings initiatives
and the benefit of recent pricing actions.
Snacks
Sales in the quarter increased 3 percent to $967 million.
Organic sales increased 4 percent. This performance reflects
continued momentum in Pepperidge Farm bakery products, Kettle Brand
potato chips, Snack Factory Pretzel Crisps, and Late July snacks,
as well as gains in Goldfish crackers, as the company laps the
negative impact of the voluntary recall in July 2018.
Segment operating earnings in the quarter increased 2 percent to
$133 million. The increase was driven primarily by sales gains and
the benefit of cost savings initiatives, including supply chain
productivity programs, partly offset by cost inflation, increased
marketing spending and higher incentive compensation.
Corporate
Corporate in the fourth quarter of fiscal 2019 included pension
and postretirement mark-to-market losses of $122 million, charges
related to cost savings initiatives of $22 million, and a non-cash
impairment charge of $16 million related to the European chips
business. Corporate in the fourth quarter of fiscal 2018 included
pension and postretirement mark-to-market gains of $117 million,
non-cash impairment charges of $54 million related to the Plum
trademark, charges related to cost savings initiatives of $46
million, and transaction and integration costs of $11 million
related to the acquisition of Snyder’s-Lance.
Discontinued Operations
The results for Campbell Fresh and Campbell International are
reported as discontinued operations. The company completed the
divestiture of the Campbell Fresh segment on June 16, 2019. As
stated above, the company expects to close the Campbell
International transactions in the first half of fiscal 2020. The
company reported a loss from discontinued operations for fiscal
2019 of $0.87 per share compared to a loss of $1.53 per share in
the prior year. Excluding items impacting comparability, the
adjusted earnings from discontinued operations were $0.31 per share
compared to $0.36 per share in the prior year.
Conference Call and Webcast
Campbell will host a conference call to discuss these results
today at 8:30 a.m. EDT. To join, dial +1 (703) 639-1316. The access
code is 8096629. Access to a live webcast of the call with
accompanying slides, as well as a replay of the call, will be
available at investor.campbellsoupcompany.com. A recording of the
call will also be available until midnight on Sep. 13, 2019, at +1
(404) 537-3406. The access code for the replay is 8096629.
Reportable Segments
Campbell Soup Company earnings results are reported as
follows:
Meals & Beverages includes the
retail and food service businesses in the U.S. and Canada. The
segment includes the following products: Campbell’s condensed and
ready-to-serve soups; Swanson broth and stocks; Pacific Foods
broth, soups, non-dairy beverages and other simple meals; Prego
pasta sauces; Pace Mexican sauces; Campbell’s gravies, pasta, beans
and dinner sauces; Swanson canned poultry; Plum baby food and
snacks; V8 juices and beverages; and, Campbell’s tomato juice. The
segment also includes the simple meals and shelf-stable beverages
business in Latin America. Beginning in the third quarter of fiscal
2019, the segment also includes a portion of the U.S. refrigerated
soup business that was previously managed as part of the now
divested Campbell Fresh segment. Prior-period segment results have
been adjusted retroactively to reflect this change.
Snacks consists of Campbell's snacking
portfolio in U.S. retail which includes the following products:
Pepperidge Farm cookies including Milano and Farmhouse; Goldfish
crackers; Pepperidge Farm fresh bakery and frozen products;
Snyder’s of Hanover pretzels; Lance sandwich crackers; Cape Cod and
Kettle Brand potato chips; Late July snacks; Snack Factory Pretzel
Crisps; Pop Secret popcorn; Emerald nuts; and, other snacking
products. The segment also includes Campbell’s European chips
business.
About Campbell Soup Company
Campbell (NYSE:CPB) is driven and inspired by our Purpose, "Real
food that matters for life's moments." For generations, people have
trusted Campbell to provide authentic, flavorful and affordable
snacks, soups and simple meals, and beverages. Founded in 1869,
Campbell has a heritage of giving back and acting as a good steward
of the planet's natural resources. The company is a member of the
Standard and Poor's 500 and the Dow Jones Sustainability Indexes.
For more information, visit www.campbellsoupcompany.com or follow
company news on Twitter via @CampbellSoupCo.
Forward-Looking Statements
This release contains “forward-looking statements” that reflect
the company’s current expectations about the impact of its future
plans and performance on the company’s business or financial
results. These forward-looking statements, including any statements
made regarding sales, EBIT and EPS guidance, rely on a number of
assumptions and estimates that could be inaccurate and which are
subject to risks and uncertainties. The factors that could cause
the company’s actual results to vary materially from those
anticipated or expressed in any forward-looking statement include:
(1) the company’s ability to execute on and realize the expected
benefits from its strategy, including growing sales in snacks and
maintaining its market share position in soup; (2) the impact of
strong competitive responses to the company’s efforts to leverage
its brand power with product innovation, promotional programs and
new advertising; (3) the risks associated with trade and consumer
acceptance of product improvements, shelving initiatives, new
products and pricing and promotional strategies; (4) the company’s
ability to complete and to realize the projected benefits of
planned divestitures and other business portfolio changes; (5) the
company’s indebtedness and ability to pay such indebtedness; (6)
the ability to realize projected cost savings and benefits from
cost savings initiatives and the integration of recent
acquisitions; (7) disruptions to the company’s supply chain,
including fluctuations in the supply of and inflation in energy and
raw and packaging materials cost; (8) the company’s ability to
manage changes to its organizational structure and/or business
processes, including selling, distribution, manufacturing and
information management systems or processes; (9) changes in
consumer demand for the company’s products and favorable perception
of the company’s brands; (10) changing inventory management
practices by certain of the company’s key customers; (11) a
changing customer landscape, with value and e-commerce retailers
expanding their market presence, while certain of the company’s key
customers maintain significance to the company’s business; (12)
product quality and safety issues, including recalls and product
liabilities; (13) the costs, disruption and diversion of
management’s attention associated with activist investors; (14) the
uncertainties of litigation and regulatory actions against the
company; (15) the possible disruption to the independent contractor
distribution models used by certain of the company’s businesses,
including as a result of litigation or regulatory actions affecting
their independent contractor classification; (16) a material
failure in or breach of the company’s information technology
systems; (17) impairment to goodwill or other intangible assets;
(18) the company’s ability to protect its intellectual property
rights; (19) increased liabilities and costs related to the
company’s defined benefit pension plans; (20) the company’s ability
to attract and retain key talent; (21) changes in currency exchange
rates, tax rates, interest rates, debt and equity markets,
inflation rates, economic conditions, law, regulation and other
external factors; (22) unforeseen business disruptions in one or
more of the company’s markets due to political instability, civil
disobedience, terrorism, armed hostilities, extreme weather
conditions, natural disasters or other calamities; and (23) other
factors described in the company’s most recent Form 10-K and
subsequent Securities and Exchange Commission filings. The company
disclaims any obligation or intent to update the forward-looking
statements in order to reflect events or circumstances after the
date of this release.
CAMPBELL SOUP COMPANY
CONSOLIDATED STATEMENTS OF
EARNINGS (unaudited)
(millions, except per share
amounts)
Three Months Ended
July 28, 2019
July 29, 2018
Net sales
$
1,780
$
1,745
Costs and expenses
Cost of products sold
1,174
1,197
Marketing and selling expenses
195
178
Administrative expenses
166
159
Research and development expenses
25
21
Other expenses / (income)
128
(66
)
Restructuring charges
9
4
Total costs and expenses
1,697
1,493
Earnings before interest and taxes
83
252
Interest, net
84
89
Earnings (loss) before taxes
(1
)
163
Taxes on earnings
4
37
Earnings (loss) from continuing
operations
(5
)
126
Loss from discontinued operations
(3
)
(32
)
Net earnings (loss)
(8
)
94
Net loss attributable to noncontrolling
interests
—
—
Net earnings (loss) attributable to
Campbell Soup Company
$
(8
)
$
94
Per share - basic
Earnings (loss) from continuing operations
attributable to Campbell Soup Company
$
(.02
)
$
.42
Loss from discontinued operations
(.01
)
(.11
)
Net earnings (loss) attributable to
Campbell Soup Company
$
(.03
)
$
.31
Dividends
$
.35
$
.35
Weighted average shares outstanding -
basic
301
301
Earnings per share - assuming dilution
From continuing operations attributable to
Campbell Soup Company
$
(.02
)
$
.42
From discontinued operations
(.01
)
(.11
)
Net attributable to Campbell Soup
Company
$
(.03
)
$
.31
Weighted average shares outstanding -
assuming dilution
301
302
CAMPBELL SOUP COMPANY
CONSOLIDATED STATEMENTS OF
EARNINGS
(millions, except per share
amounts)
Twelve Months Ended
July 28, 2019
July 29, 2018
Net sales
$
8,107
$
6,615
Costs and expenses
Cost of products sold
5,414
4,241
Marketing and selling expenses
842
728
Administrative expenses
610
563
Research and development expenses
91
91
Other expenses / (income)
140
(73
)
Restructuring charges
31
55
Total costs and expenses
7,128
5,605
Earnings before interest and taxes
979
1,010
Interest, net
354
180
Earnings before taxes
625
830
Taxes on earnings
151
106
Earnings from continuing operations
474
724
Loss from discontinued operations
(263
)
(463
)
Net earnings
211
261
Net loss attributable to noncontrolling
interests
—
—
Net earnings attributable to Campbell Soup
Company
$
211
$
261
Per share - basic
Earnings from continuing operations
attributable to Campbell Soup Company
$
1.57
$
2.41
Loss from discontinued operations
(.87
)
(1.54
)
Net earnings attributable to Campbell Soup
Company
$
.70
$
.87
Dividends
$
1.40
$
1.40
Weighted average shares outstanding -
basic
301
301
Per share - assuming dilution
Earnings from continuing operations
attributable to Campbell Soup Company
$
1.57
$
2.40
Loss from discontinued operations
(.87
)
(1.53
)
Net earnings attributable to Campbell Soup
Company*
$
.70
$
.86
Weighted average shares outstanding -
assuming dilution
302
302
*The sum of the individual per share
amounts may not add due to rounding.
CAMPBELL SOUP COMPANY
CONSOLIDATED SUPPLEMENTAL
SCHEDULE OF SALES AND EARNINGS (unaudited)
(millions, except per share
amounts)
Three Months Ended
July 28, 2019
July 29, 2018
Percent Change
Sales
Contributions:
Meals & Beverages
$
813
$
809
—%
Snacks
967
936
3%
Total sales
$
1,780
$
1,745
2%
Earnings
Contributions:
Meals & Beverages
$
151
$
156
(3)%
Snacks
133
131
2%
Total operating earnings
284
287
(1)%
Corporate
(192
)
(31
)
Restructuring charges
(9
)
(4
)
Earnings before interest and taxes
83
252
(67)%
Interest, net
84
89
Taxes on earnings
4
37
Earnings (loss) from continuing
operations
(5
)
126
Loss from discontinued operations
(3
)
(32
)
Net earnings (loss)
(8
)
94
n/m
Net loss attributable to noncontrolling
interests
—
—
Net earnings (loss) attributable to
Campbell Soup Company
$
(8
)
$
94
n/m
Earnings per share - assuming dilution
From continuing operations attributable to
Campbell Soup Company
$
(.02
)
$
.42
From discontinued operations
(.01
)
(.11
)
Net attributable to Campbell Soup
Company
$
(.03
)
$
.31
n/m
n/m - not meaningful
Beginning in fiscal 2019, the business in Latin America is
managed as part of the Meals & Beverages segment. In fiscal
2018, the business in Latin America was managed as part of the
Global Biscuits and Snacks segment.
On June 16, 2019, the company sold its Bolthouse Farms business.
In the third quarter of fiscal 2019, the company also sold its
refrigerated soup plant and its Garden Fresh Gourmet business.
Beginning in the third quarter of fiscal 2019, the results of these
businesses were reported as discontinued operations. The businesses
were historically included in the Campbell Fresh segment. A portion
of the U.S. refrigerated soup business was retained and is now
reported in Meals & Beverages.
On July 12, 2019, the company announced it had signed a
definitive agreement for the sale of the Kelsen Group; and on
August 2, 2019, the company announced it had signed a definitive
agreement for the sale of Arnott's and certain of its international
operations. Beginning in the fourth quarter of fiscal 2019, the
results of these businesses were reported as discontinued
operations. The businesses were historically included in the Global
Biscuits and Snacks segment. Prior periods have been adjusted
retrospectively to reflect these changes.
CAMPBELL SOUP COMPANY
CONSOLIDATED SUPPLEMENTAL
SCHEDULE OF SALES AND EARNINGS
(millions, except per share
amounts)
Twelve Months Ended
July 28, 2019
July 29, 2018
Percent Change
Sales
Contributions:
Meals & Beverages
$
4,322
$
4,305
—%
Snacks
3,784
2,307
64%
Corporate
1
3
n/m
Total sales
$
8,107
$
6,615
23%
Earnings
Contributions:
Meals & Beverages
$
903
$
988
(9)%
Snacks
514
383
34%
Total operating earnings
1,417
1,371
3%
Corporate
(407
)
(306
)
Restructuring charges
(31
)
(55
)
Earnings before interest and taxes
979
1,010
(3)%
Interest, net
354
180
Taxes on earnings
151
106
Earnings from continuing operations
474
724
Loss from discontinued operations
(263
)
(463
)
Net earnings
211
261
(19)%
Net loss attributable to noncontrolling
interests
—
—
Net earnings attributable to Campbell Soup
Company
$
211
$
261
(19)%
Per share - assuming dilution
Earnings from continuing operations
attributable to Campbell Soup Company
$
1.57
$
2.40
Loss from discontinued operations
(.87
)
(1.53
)
Net earnings attributable to Campbell Soup
Company*
$
.70
$
.86
(19)%
*The sum of the individual per share
amounts may not add due to rounding.
n/m - not meaningful
Beginning in fiscal 2019, the business in Latin America is
managed as part of the Meals & Beverages segment. In fiscal
2018, the business in Latin America was managed as part of the
Global Biscuits and Snacks segment.
On June 16, 2019, the company sold its Bolthouse Farms business.
In the third quarter of fiscal 2019, the company also sold its
refrigerated soup plant and its Garden Fresh Gourmet business.
Beginning in the third quarter of fiscal 2019, the results of these
businesses were reported as discontinued operations. The businesses
were historically included in the Campbell Fresh segment. A portion
of the U.S. refrigerated soup business was retained and is now
reported in Meals & Beverages.
On July 12, 2019, the company announced it had signed a
definitive agreement for the sale of the Kelsen Group; and on
August 2, 2019, the company announced it had signed a definitive
agreement for the sale of Arnott's and certain of its international
operations. Beginning in the fourth quarter of fiscal 2019, the
results of these businesses were reported as discontinued
operations. The businesses were historically included in the Global
Biscuits and Snacks segment. Prior periods have been adjusted
retrospectively to reflect these changes.
CAMPBELL SOUP COMPANY
CONDENSED CONSOLIDATED BALANCE
SHEETS
(millions)
July 28, 2019
July 29, 2018
Current assets
$
1,539
$
1,570
Current assets of discontinued
operations
428
726
Plant assets, net
2,455
2,466
Intangible assets, net
7,432
7,528
Other assets
127
189
Noncurrent assets of discontinued
operations
1,167
2,050
Total assets
$
13,148
$
14,529
Current liabilities
$
2,916
$
2,863
Current liabilities of discontinued
operations
469
731
Long-term debt
7,103
7,991
Other liabilities
1,483
1,507
Noncurrent liabilities of discontinued
operations
65
64
Total equity
1,112
1,373
Total liabilities and equity
$
13,148
$
14,529
Total debt*
$
8,712
$
9,894
Cash and cash equivalents*
$
179
$
226
*Includes assets and liabilities held for
sale
On July 12, 2019, the company announced it had signed a
definitive agreement for the sale of the Kelsen Group, and on
August 2, 2019, the company announced it had signed a definitive
agreement for the sale of Arnott's and certain of its international
operations. The assets and liabilities of these businesses were
reported as assets and liabilities held for sale as of July 28,
2019, and July 29, 2018. On June 16, 2019, the company sold its
Bolthouse Farms business. In the third quarter of fiscal 2019, the
company also sold its refrigerated soup plant and its Garden Fresh
Gourmet business. The assets and liabilities of these businesses
were reported as assets and liabilities of discontinued operations
as of July 29, 2018.
CAMPBELL SOUP COMPANY
CONSOLIDATED STATEMENTS OF CASH
FLOWS
(millions)
Twelve Months Ended
July 28, 2019
July 29, 2018
Cash flows from operating activities:
Net earnings
$
211
$
261
Adjustments to reconcile net earnings to
operating cash flow
Impairment charges
393
748
Restructuring charges
31
62
Stock-based compensation
58
61
Amortization of inventory fair value
adjustment from acquisition
—
42
Pension and postretirement benefit expense
(income)
103
(187
)
Depreciation and amortization
446
394
Deferred income taxes
14
(133
)
Losses on sales of discontinued operations
businesses
32
—
Other, net
25
34
Changes in working capital, net of
acquisitions and divestitures
Accounts receivable
(11
)
56
Inventories
36
(84
)
Prepaid assets
(1
)
27
Accounts payable and accrued
liabilities
125
78
Other
(64
)
(54
)
Net cash provided by operating
activities
1,398
1,305
Cash flows from investing activities:
Purchases of plant assets
(384
)
(407
)
Purchases of route businesses
(29
)
(9
)
Sales of route businesses
31
10
Businesses acquired, net of cash
acquired
(18
)
(6,772
)
Sales of discontinued operations
businesses, net of cash divested
539
—
Other, net
14
(19
)
Net cash provided by (used in) investing
activities
153
(7,197
)
Cash flows from financing activities:
Short-term borrowings
5,839
10,222
Short-term repayments
(6,296
)
(9,944
)
Long-term borrowings
—
6,224
Long-term repayments
(702
)
(63
)
Dividends paid
(423
)
(426
)
Treasury stock purchases
—
(86
)
Payments related to tax withholding for
stock-based compensation
(8
)
(23
)
Repurchase of noncontrolling interest
—
(47
)
Payments of debt issuance costs
(1
)
(50
)
Net cash provided by (used in) financing
activities
(1,591
)
5,807
Effect of exchange rate changes on
cash
(7
)
(8
)
Net change in cash and cash
equivalents
(47
)
(93
)
Cash and cash equivalents — beginning of
period
49
37
Cash balance of discontinued operations —
beginning of period
177
282
Cash balance of discontinued operations —
end of period
(148
)
(177
)
Cash and cash equivalents — end of
period
$
31
$
49
Reconciliation of GAAP to Non-GAAP Financial
Measures Fiscal Year Ended July 28, 2019
Campbell Soup Company uses certain non-GAAP financial measures
as defined by the Securities and Exchange Commission in certain
communications. These non-GAAP financial measures are measures of
performance not defined by accounting principles generally accepted
in the United States and should be considered in addition to, not
in lieu of, GAAP reported measures. Management believes that also
presenting certain non-GAAP financial measures provides additional
information to facilitate comparison of the company's historical
operating results and trends in its underlying operating results,
and provides transparency on how the company evaluates its
business. Management uses these non-GAAP financial measures in
making financial, operating and planning decisions and in
evaluating the company's performance. Beginning in the third
quarter of fiscal 2019, the results of the Campbell Fresh segment
are reported as discontinued operations. Beginning in the fourth
quarter of fiscal 2019, the results of the Kelsen Group, Arnott's
and certain international businesses (Campbell International),
which represent the former international biscuits and snacks
operating segment, are reported as discontinued operations. As this
is the first quarter presenting Campbell International as
discontinued operations, we have provided certain combined
financial measures of continuing operations and Campbell
International to facilitate comparison of the company’s historical
operating results.
Organic Net Sales
Organic net sales are net sales excluding the impact of currency
and acquisitions. Management believes that excluding these items,
which are not part of the ongoing business, improves the
comparability of year-to-year results. A reconciliation of net
sales as reported to organic net sales and combined net sales
follows.
Three Months Ended
July 28, 2019
July 29, 2018
% Change
(millions)
Net Sales, as
Reported
Impact of
Currency
Organic Net
Sales
Net Sales, as
Reported
Net Sales, as
Reported
Organic Net
Sales
Meals & Beverages
$
813
$
1
$
814
$
809
—
%
1
%
Snacks
967
2
969
936
3
%
4
%
Total Net Sales
$
1,780
$
3
$
1,783
$
1,745
2
%
2
%
Campbell International
$
244
$
247
Combined Net Sales
$
2,024
$
1,992
2
%
Year Ended
July 28, 2019
July 29, 2018
% Change
(millions)
Net Sales, as
Reported
Impact of
Currency
Impact of
Acquisitions
Organic Net
Sales
Net Sales, as
Reported
Net Sales, as
Reported
Organic Net
Sales
Meals & Beverages
$
4,322
$
18
$
(100
)
$
4,240
$
4,305
—
%
(2
)%
Snacks
3,784
3
(1,401
)
2,386
2,307
64
%
3
%
Corporate
1
—
—
1
3
n/m
n/m
Total Net Sales
$
8,107
$
21
$
(1,501
)
$
6,627
$
6,615
23
%
—
%
Campbell International
1,046
1,120
Combined Net Sales
$
9,153
$
7,735
18
%
n/m - not meaningful
Items Impacting Earnings
The company believes that financial information excluding
certain items that are not considered to reflect the ongoing
operating results, such as those listed below, improves the
comparability of year-to-year results. Consequently, the company
believes that investors may be able to better understand its
results excluding these items.
The following items impacted earnings:
(1)
In fiscal 2015, the company implemented
initiatives to reduce costs and to streamline its organizational
structure. In fiscal 2017, the company expanded these cost savings
initiatives by further optimizing its supply chain network,
primarily in North America, continuing to evolve its operating
model to drive efficiencies, and more fully integrating its recent
acquisitions. In January 2018, as part of the expanded initiatives,
the company authorized additional costs to improve the operational
efficiency of its thermal supply chain network in North America by
closing its manufacturing facility in Toronto, Ontario, and to
optimize its information technology infrastructure by migrating
certain applications to the latest cloud technology platform. In
August 2018, the company announced that it will continue to
streamline its organization, expand its zero-based budgeting
efforts and optimize its manufacturing network. In fiscal 2019, the
company began to include costs associated with the Snyder's-Lance
cost transformation program and integration with these
initiatives.
In the fourth quarter of fiscal 2019, the
company recorded Restructuring charges of $9 million and
implementation costs and other related costs of $27 million in
Administrative expenses, $1 million in Marketing and selling
expenses, and $1 million in Research and development expenses, and
a reduction to Cost of products sold of $7 million (aggregate
impact of $24 million after tax, or $.08 per share) in Loss from
continuing operations related to these initiatives. In fiscal 2019,
the company recorded Restructuring charges of $31 million and
implementation costs and other related costs of $62 million in
Administrative expenses, $18 million in Cost of products sold, $7
million in Marketing and selling expenses, and $3 million in
Research and development expenses (aggregate impact of $92 million
after tax, or $.30 per share) in Earnings from continuing
operations related to these initiatives. The company also recorded
a $1 million pre-tax and after-tax charge in Loss from discontinued
operations associated with Campbell Fresh and a $1 million pre-tax
and after-tax gain in Loss from discontinued operations associated
with Campbell International related to these initiatives. In the
fourth quarter of fiscal 2018, the company recorded Restructuring
charges of $1 million and implementation costs and other related
costs of $20 million in Administrative expenses, $25 million in
Cost of products sold, and $1 million in Marketing and selling
expenses (aggregate impact of $34 million after tax, or $.11 per
share) in Earnings from continuing operations related to these
initiatives. The company also recorded a $1 million pre-tax and
after-tax gain in Loss from discontinued operations associated with
Campbell International related to these initiatives. In fiscal
2018, the company recorded Restructuring charges of $42 million and
implementation costs and other related costs of $87 million in
Administrative expenses, $45 million in Cost of products sold, and
$3 million in Marketing and selling expenses (aggregate impact of
$132 million after tax, or $.44 per share) in Earnings from
continuing operations related to these initiatives. The company
also recorded charges of $2 million ($1 million after tax) and $6
million ($3 million after tax, or $.01 per share) associated with
Campbell Fresh and Campbell International, respectively, related to
these initiatives. The aggregate impact of charges in Loss from
discontinued operations related to these initiatives was $8 million
($4 million after tax, or $.01 per share).
(2)
In the fourth quarter of fiscal 2019, as
part of the company's annual review of intangible assets, the
company recognized an impairment charge of $7 million on a
trademark and $10 million on goodwill in Kelsen due to a lower
long-term outlook for sales and the pending sale of the business.
The aggregate impact was $17 million ($12 million after tax, or
$.04 per share).
In the second quarter of fiscal 2019,
interim impairment assessments were performed on the intangible and
tangible assets within Campbell Fresh, which includes Garden Fresh
Gourmet, Bolthouse Farms carrot and carrot ingredients, and
Bolthouse Farms refrigerated beverages and salad dressings, as the
company continued to pursue the divestiture of these businesses.
The company revised its future outlook for earnings and cash flows
for each of these businesses as the divestiture process
progressed.
The company recorded non-cash impairment
charges of $104 million on the tangible assets and $73 million on
the intangible assets of Bolthouse Farms carrot and carrot
ingredients; $96 million on the intangible assets and $9 million on
the tangible assets of Bolthouse Farms refrigerated beverages and
salad dressings; and $62 million on the intangible assets and $2
million on the tangible assets of Garden Fresh Gourmet. The
aggregate impact of the impairment charges was $346 million, of
which $115 million was recorded in Cost of products sold and $231
million in Other expenses / (income), ($264 million after tax, or
$.88 per share). In the first quarter of fiscal 2019, the company
recorded a non-cash impairment charge of $14 million in Cost of
products sold ($11 million after tax, or $.04 per share) on its
U.S. refrigerated soup plant assets.
In fiscal 2019, the total non-cash
impairment charges recorded were $377 million, of which $129
million was recorded in Cost of products sold and $248 million in
Other expenses / (income), ($287 million after tax, or $.95 per
share).
In the third quarter of fiscal 2018, the
company performed interim impairment assessments within Campbell
Fresh on the deli reporting unit, which includes Garden Fresh
Gourmet and the U.S. refrigerated soup business, and the Bolthouse
Farms refrigerated beverages and salad dressings reporting unit.
Within the deli unit, the company revised its long-term outlook due
to the anticipated loss of refrigerated soup business with certain
private label customers, as well as the performance of the
business. In addition, the operating performance of the Bolthouse
Farms refrigerated beverages and salad dressings reporting unit was
below expectations. The company revised its long-term outlook for
future earnings and cash flows for each of these reporting units.
The company recorded a non-cash impairment charge of $11 million on
the tangible assets and $94 million on the intangible assets ($80
million after tax, or $.27 per share) of the deli reporting unit,
and a non-cash impairment charge of $514 million ($417 million
after tax, or $1.39 per share) related to the intangible assets of
the Bolthouse Farms refrigerated beverages and salad dressings
reporting unit. The aggregate impact of the impairment charges was
$619 million, of which $11 million was recorded in Cost of products
sold and $608 million in Other expenses / (income), ($497 million
after tax, or $1.65 per share).
In the second quarter of fiscal 2018, the
company performed an interim impairment assessment on the
intangible assets of the Bolthouse Farms carrot and carrot
ingredients reporting unit as operating performance was below
expectations. The company revised its outlook for future earnings
and cash flows and recorded a non-cash impairment charge of $75
million in Other expenses / (income) ($74 million after tax, or
$.25 per share).
In fiscal 2018, the total non-cash
impairment charges recorded were $694 million, of which $11 million
was recorded in Cost of products sold and $683 million in Other
expenses / (income), ($571 million after tax, or $1.89 per
share).
These impairment charges were all recorded
in Loss from discontinued operations.
In the fourth quarter of fiscal 2019, the
company performed an assessment on the assets within the European
chips business and recorded a non-cash impairment charge of $16
million ($13 million after tax, or $.04 per share) on intangible
assets in Earnings (loss) from continuing operations in Other
expenses / (income).
In the fourth quarter of fiscal 2018, the
company performed an impairment assessment on the Plum trademark.
In fiscal 2018, sales and operating performance were well below
expectations due in part to competitive pressure and reduced
margins. In the fourth quarter of fiscal 2018, as part of a
strategic review initiated by a new leadership team and based on
recent performance, the company lowered its long-term outlook for
future sales. The company recorded a non-cash impairment charge of
$54 million ($41 million after tax, or $.14 per share) in Earnings
from continuing operations in Other expenses / (income).
(3)
In the fourth quarter of fiscal 2019, the
company incurred pre-tax expenses of $1 million (a gain of $1
million after tax) associated with the sale process of the
businesses in Campbell Fresh, including a loss on the sale of
Bolthouse Farms. The company also incurred costs of $5 million
pre-tax and after tax ($.02 per share) associated with the planned
divestiture of Campbell International. The aggregate impact was $4
million after tax, or $.01 per share, in Loss from discontinued
operations. In fiscal 2019, the company incurred pre-tax expenses
of $32 million associated with the sale process of the businesses
in Campbell Fresh, including losses on the sale of the U.S.
refrigerated soup business, Garden Fresh Gourmet and Bolthouse
Farms. In addition, the company recorded tax expense of $29 million
as deferred tax assets on Bolthouse Farms were not realizable
(aggregate impact of $51 million after tax, or $.17 per share). The
company also incurred costs of $12 million ($10 million after tax,
or $.03 per share) associated with the planned divestiture of
Campbell International. The aggregate impact was $61 million after
tax, or $.20 per share, in Loss from discontinued operations.
(4)
In the third quarter of fiscal 2019, the
company recognized a pre-tax pension settlement charge in Other
expenses / (income) of $28 million ($22 million after tax, or $.07
per share) in Earnings from continuing operations associated with a
U.S. pension plan. The settlement resulted from the level of lump
sum distributions from the plan's assets in 2019.
(5)
In fiscal 2018 and 2019, the company
reflected the impact of taxes on the enactment of the Tax Cuts and
Jobs Act that was signed into law in December 2017. In fiscal 2019,
the company recorded a tax charge of $2 million ($.01 per share)
related to a transition tax on unremitted foreign earnings. In the
fourth quarter of fiscal 2018, the company recorded a tax benefit
of $6 million ($.02 per share) related to the transition tax on
unremitted foreign earnings. In fiscal 2018, the company recorded a
tax benefit of $179 million due to the remeasurement of deferred
tax assets and liabilities, and a tax charge of $53 million related
to the transition tax on unremitted foreign earnings. The net
impact was a tax benefit of $126 million ($.42 per share). These
charges and benefits were all recorded in Earnings from continuing
operations.
(6)
In the fourth quarter of fiscal 2019, the
company incurred losses of $122 million in Other expenses /
(income) ($93 million after tax, or $.31 per share) in Earnings
(loss) from continuing operations associated with mark-to-market
adjustments for defined benefit pension and postretirement plans.
The company also incurred losses of $12 million ($9 million after
tax, or $.03 per share) in Loss from discontinued operations
related to Campbell International. In the fourth quarter of fiscal
2018, the company incurred gains of $117 million in Other expenses
/ (income) ($90 million after tax, or $.30 per share) in Earnings
from continuing operations associated with mark-to-market
adjustments for defined benefit pension and postretirement plans.
The company also incurred mark-to-market and curtailment gains of
$5 million ($3 million after tax, or $.01 per share) in Loss from
discontinued operations related to Campbell International. In
fiscal 2018, the company incurred gains of $131 million in Other
expenses / (income) ($100 million after tax, or $.33 per share) in
Earnings from continuing operations associated with mark-to-market
adjustments for defined benefit pension and postretirement plans.
The company also incurred mark-to-market and curtailment gains of
$5 million ($3 million after tax, or $.01 per share) in Loss from
discontinued operations related to Campbell International.
(7)
In the second quarter of fiscal 2018, the
company announced its intent to acquire Snyder's-Lance, Inc. and on
March 26, 2018, the acquisition closed. In the fourth quarter of
fiscal 2018, the company incurred $5 million in Cost of products
sold associated with an acquisition date fair value adjustment for
inventory. The company also incurred integration costs in
association with its cost savings initiatives, of which $3 million
was recorded in Restructuring charges and $6 million in
Administrative expenses. The aggregate impact was $14 million, $8
million after tax, or $.03 per share. In fiscal 2018, the company
incurred transaction costs of $53 million recorded in Other
expenses / (income), $42 million in Cost of products sold and a
gain in Interest expense of $18 million on treasury rate lock
contracts used to hedge the planned financing of the acquisition.
The company also incurred integration costs in association with its
cost savings initiatives, of which $13 million was recorded in
Restructuring charges and $12 million in Administrative expenses.
The aggregate impact was $102 million, $73 million after tax, or
$.24 per share. These costs were all recorded in Earnings from
continuing operations.
(8)
In the third quarter of fiscal 2018, the
company recorded a loss of $22 million in Other expenses / (income)
($15 million after tax, or $.05 per share) in Earnings from
continuing operations from a settlement of a legal claim.
The following tables reconcile financial information, presented
in accordance with GAAP, to financial information excluding certain
items:
Three Months Ended
July 28, 2019
July 29, 2018
(millions, except per share amounts)
As reported
Adjustments(a)
Adjusted
As reported
Adjustments(a)
Adjusted
Adjusted Percent
Change
Gross margin
$
606
$
(7
)
$
599
$
548
$
30
$
578
4
%
Gross margin percentage
34.0
%
33.7
%
31.4
%
33.1
%
Marketing and selling expenses
195
(1
)
194
178
(1
)
177
Administrative expenses
166
(27
)
139
159
(26
)
133
Research and development expenses
25
(1
)
24
21
—
21
Other expenses / (income)
128
(138
)
(10
)
(66
)
63
(3
)
Restructuring charges
9
(9
)
—
4
(4
)
—
Earnings before interest and taxes
$
83
$
169
$
252
$
252
$
(2
)
$
250
1
%
Interest, net
84
—
84
89
—
89
Earnings before taxes
$
(1
)
$
169
$
168
$
163
$
(2
)
$
161
Taxes
4
39
43
37
11
48
Effective income tax rate
(400.0
)%
25.6
%
22.7
%
29.8
%
Earnings (loss) from continuing
operations
$
(5
)
$
130
$
125
$
126
$
(13
)
$
113
11
%
Earnings (loss) from discontinued
operations
(3
)
25
22
(32
)
(4
)
(36
)
n/m
Net earnings (loss) attributable to
Campbell Soup Company
$
(8
)
$
155
$
147
$
94
$
(17
)
$
77
91
%
Diluted earnings (loss) per share -
continuing operations attributable to Campbell Soup Company*
$
(.02
)
$
.43
$
.42
$
.42
$
(.04
)
$
.37
14
%
Diluted earnings (loss) per share -
discontinued operations
(.01
)
.08
.07
(.11
)
(.01
)
(.12
)
n/m
Diluted net earnings (loss) per share
attributable to Campbell Soup Company*
$
(.03
)
$
.51
$
.49
$
.31
$
(.06
)
$
.25
96
%
(a)See following tables for additional
information.
*The sum of individual per share amounts
may not add due to rounding.
n/m - not meaningful
Three Months Ended
July 28, 2019
(millions, except per share amounts)
Restructuring charges,
implementation costs and other related costs (1)
Impairment charges (2)
Costs associated with
divestitures (3)
Mark-to- market (6)
Adjustments
Gross margin
$
(7
)
$
—
$
—
$
—
$
(7
)
Marketing and selling expenses
(1
)
—
—
—
(1
)
Administrative expenses
(27
)
—
—
—
(27
)
Research and development expenses
(1
)
—
—
—
(1
)
Other expenses / (income)
—
(16
)
—
(122
)
(138
)
Restructuring charges
(9
)
—
—
—
(9
)
Earnings before interest and taxes
$
31
$
16
$
—
$
122
$
169
Interest, net
—
—
—
—
—
Earnings before taxes
$
31
$
16
$
—
$
122
$
169
Taxes
7
3
—
29
39
Earnings from continuing operations
$
24
$
13
$
—
$
93
$
130
Earnings from discontinued operations
—
12
4
9
25
Net earnings attributable to Campbell Soup
Company
$
24
$
25
$
4
$
102
$
155
Diluted earnings per share - continuing
operations attributable to Campbell Soup Company
$
.08
$
.04
$
—
$
.31
$
.43
Diluted earnings per share - discontinued
operations
—
.04
.01
.03
.08
Diluted net earnings per share
attributable to Campbell Soup Company
$
.08
$
.08
$
.01
$
.34
$
.51
Three Months Ended
July 29, 2018
(millions, except per share amounts)
Restructuring charges,
implementation costs and other related costs (1)
Impairment charges (2)
Tax reform (5)
Mark-to- market (6)
Transaction and integration
costs (7)
Adjustments
Gross margin
$
25
$
—
$
—
$
—
$
5
$
30
Marketing and selling expenses
(1
)
—
—
—
—
(1
)
Administrative expenses
(20
)
—
—
—
(6
)
(26
)
Other expenses / (income)
—
(54
)
—
117
—
63
Restructuring charges
(1
)
—
—
—
(3
)
(4
)
Earnings before interest and taxes
$
47
$
54
$
—
$
(117
)
$
14
$
(2
)
Interest, net
—
—
—
—
—
—
Earnings before taxes
$
47
$
54
$
—
$
(117
)
$
14
$
(2
)
Taxes
13
13
6
(27
)
6
11
Earnings from continuing operations
$
34
$
41
$
(6
)
$
(90
)
$
8
$
(13
)
Earnings from discontinued operations
(1
)
—
—
(3
)
—
(4
)
Net earnings attributable to Campbell Soup
Company
$
33
$
41
$
(6
)
$
(93
)
$
8
$
(17
)
Diluted earnings per share - continuing
operations attributable to Campbell Soup Company
$
.11
$
.14
$
(.02
)
$
(.30
)
$
.03
$
(.04
)
Diluted earnings per share - discontinued
operations
—
—
—
(.01
)
—
(.01
)
Diluted net earnings per share
attributable to Campbell Soup Company*
$
.11
$
.14
$
(.02
)
$
(.31
)
$
.03
$
(.06
)
*The sum of individual per share amounts
may not add due to rounding.
Twelve Months Ended
July 28, 2019
July 29, 2018
(millions, except per share amounts)
As reported
Adjustments(a)
Adjusted
As reported
Adjustments(a)
Adjusted
Adjusted Percent
Change
Gross margin
$
2,693
$
18
$
2,711
$
2,374
$
87
$
2,461
10%
Gross margin percentage
33.2
%
33.4
%
35.9
%
37.2
%
Marketing and selling expenses
842
(7
)
835
728
(3
)
725
Administrative expenses
610
(62
)
548
563
(99
)
464
Research and development expenses
91
(3
)
88
91
—
91
Other expenses / (income)
140
(166
)
(26
)
(73
)
2
(71
)
Restructuring charges
31
(31
)
—
55
(55
)
—
Earnings before interest and taxes
$
979
$
287
$
1,266
$
1,010
$
242
$
1,252
1%
Interest, net
354
—
354
180
18
198
Earnings before taxes
$
625
$
287
$
912
$
830
$
224
$
1,054
Taxes
151
65
216
106
189
295
Effective income tax rate
24.2
%
23.7
%
12.8
%
28.0
%
Earnings from continuing operations
$
474
$
222
$
696
$
724
$
35
$
759
(8)%
Earnings (loss) from discontinued
operations
(263
)
357
94
(463
)
572
109
(14)%
Net earnings attributable to Campbell Soup
Company
$
211
$
579
$
790
$
261
$
607
$
868
(9)%
Diluted earnings per share - continuing
operations attributable to Campbell Soup Company*
$
1.57
$
.74
$
2.30
$
2.40
$
.12
$
2.51
(8)%
Diluted earnings (loss) per share -
discontinued operations
(.87
)
1.18
.31
(1.53
)
1.89
.36
(14)%
Diluted net earnings per share
attributable to Campbell Soup Company*
$
.70
$
1.92
$
2.62
$
.86
$
2.01
$
2.87
(9)%
(a)See following tables for additional
information.
*The sum of individual per share amounts
may not add due to rounding.
n/m - not meaningful
Twelve Months Ended
July 28, 2019
(millions, except per share amounts)
Restructuring charges,
implementation costs and other related costs (1)
Impairment charges (2)
Costs associated with
divestitures (3)
Pension settlement (4)
Tax reform (5)
Mark- to- market (6)
Adjustments
Gross margin
$
18
$
—
$
—
$
—
$
—
$
—
$
18
Marketing and selling expenses
(7
)
—
—
—
—
—
(7
)
Administrative expenses
(62
)
—
—
—
—
—
(62
)
Research and development expenses
(3
)
—
—
—
—
—
(3
)
Other expenses / (income)
—
(16
)
—
(28
)
—
(122
)
(166
)
Restructuring charges
(31
)
—
—
—
—
—
(31
)
Earnings before interest and taxes
$
121
$
16
$
—
$
28
$
—
$
122
$
287
Interest, net
—
—
—
—
—
—
—
Earnings before taxes
$
121
$
16
$
—
$
28
$
—
$
122
$
287
Taxes
29
3
—
6
(2
)
29
65
Earnings from continuing operations
$
92
$
13
$
—
$
22
$
2
$
93
$
222
Earnings from discontinued operations
—
287
61
—
—
9
357
Net earnings attributable to Campbell Soup
Company
$
92
$
300
$
61
$
22
$
2
$
102
$
579
Diluted earnings per share - continuing
operations attributable to Campbell Soup Company*
$
.30
$
.04
$
—
$
.07
$
.01
$
.31
$
.74
Diluted earnings per share - discontinued
operations
—
.95
.20
—
—
.03
1.18
Diluted net earnings per share
attributable to Campbell Soup Company
$
.30
$
.99
$
.20
$
.07
$
.01
$
.34
$
1.92
*The sum of individual per share amounts
may not add due to rounding.
Twelve Months Ended
July 29, 2018
(millions, except per share amounts)
Restructuring charges,
implementation costs and other related costs (1)
Impairment charges (2)
Tax reform (5)
Mark- to- market (6)
Transaction and integration
costs (7)
Claim settlement (8)
Adjustments
Gross margin
$
45
$
—
$
—
$
—
$
42
$
—
$
87
Marketing and selling expenses
(3
)
—
—
—
—
—
(3
)
Administrative expenses
(87
)
—
—
—
(12
)
—
(99
)
Other expenses / (income)
—
(54
)
—
131
(53
)
(22
)
2
Restructuring charges
(42
)
—
—
—
(13
)
—
(55
)
Earnings before interest and taxes
$
177
$
54
$
—
$
(131
)
$
120
$
22
$
242
Interest, net
—
—
—
—
18
—
18
Earnings before taxes
$
177
$
54
$
—
$
(131
)
$
102
$
22
$
224
Taxes
45
13
126
(31
)
29
7
189
Earnings from continuing operations
$
132
$
41
$
(126
)
$
(100
)
$
73
$
15
$
35
Earnings from discontinued operations
4
571
—
(3
)
—
—
572
Net earnings attributable to Campbell Soup
Company
$
136
$
612
$
(126
)
$
(103
)
$
73
$
15
$
607
Diluted earnings per share - continuing
operations attributable to Campbell Soup Company
$
.44
$
.14
$
(.42
)
$
(.33
)
$
.24
$
.05
$
.12
Diluted earnings per share - discontinued
operations
.01
1.89
—
(.01
)
—
—
1.89
Diluted net earnings per share
attributable to Campbell Soup Company
$
.45
$
2.03
$
(.42
)
$
(.34
)
$
.24
$
.05
$
2.01
Adjusted Earnings
Before Interest and Taxes on a Combined Basis (Continuing
Operations and Campbell International)
Three Months Ended
July 28, 2019
(millions)
As reported
Impairment charges (2)
Costs associated with
divestitures (3)
Mark-to- market (6)
Adjusted
Earnings (loss) from Campbell
International
$
(2
)
$
12
$
5
$
9
$
24
Add: Taxes on earnings from Campbell
International
2
5
—
3
10
Add: Interest, net
2
—
—
—
2
Earnings before interest and taxes -
Campbell International
$
2
$
17
$
5
$
12
$
36
Earnings before interest and taxes -
continuing operations
$
83
$
252
Combined Earnings before interest and
taxes
$
85
$
288
Three Months Ended
July 29, 2018
(millions)
As reported
Restructuring charges,
implementation costs and other related costs (1)
Mark-to- market (6)
Adjusted
Earnings from Campbell
International
$
24
$
(1
)
$
(3
)
$
20
Add (Deduct): Taxes on earnings from
Campbell International
10
—
(2
)
8
Add: Interest, net
4
—
—
4
Earnings (loss) before interest and
taxes - Campbell International
$
38
$
(1
)
$
(5
)
$
32
Earnings before interest and taxes -
continuing operations
252
250
Combined Earnings before interest and
taxes
$
290
$
282
Adjusted Combined EBIT percentage
change 2019/2018
2
%
Twelve Months Ended
July 28, 2019
(millions)
As reported
Restructuring charges,
implementation costs and other related costs (1)
Impairment charges (2)
Costs associated with
divestitures (3)
Mark- to- market (6)
Adjusted
Earnings from Campbell
International
$
69
$
(1
)
$
12
$
10
$
9
$
99
Add: Taxes on earnings from Campbell
International
39
—
5
2
3
49
Add: Interest, net
8
—
—
—
—
8
Earnings (loss) before interest and
taxes - Campbell International
$
116
$
(1
)
$
17
$
12
$
12
$
156
Earnings before interest and taxes -
continuing operations
$
979
$
1,266
Combined Earnings before interest and
taxes
$
1,095
$
1,422
Twelve Months Ended
July 29, 2018
(millions)
As reported
Restructuring charges,
implementation costs and other related costs (1)
Mark-to- market (6)
Adjusted
Earnings from Campbell
International
$
116
$
3
$
(3
)
$
116
Add (Deduct): Taxes on earnings from
Campbell International
47
3
(2
)
48
Add: Interest, net
17
—
—
17
Earnings (loss) before interest and
taxes - Campbell International
$
180
$
6
$
(5
)
$
181
Earnings before interest and taxes -
continuing operations
1,010
1,252
Combined Earnings before interest and
taxes
$
1,190
$
1,433
Adjusted Combined EBIT percentage
change 2019/2018
(1
)%
Adjusted Combined
Diluted EPS from Continuing Operations and Campbell
International
Three Months Ended
Twelve Months Ended
(millions)
July 28, 2019
July 29, 2018
Adjusted % Change
July 28, 2019
July 29, 2018
Adjusted % Change
Adjusted Diluted earnings per share -
continuing operations
$
.42
$
.37
$
2.30
$
2.51
Diluted earnings per share - Campbell
International
$
(.01
)
$
.08
$
.23
$
.38
Add: Restructuring charges, implementation
costs and other related costs (1)
—
—
—
.01
Add: Impairment charges (2)
.04
—
.04
—
Add: Costs associated with divestitures
(3)
.02
—
.03
—
Add (Deduct): Mark-to-market (6)
.03
(.01
)
.03
(.01
)
Adjusted Diluted earnings per share -
Campbell International
$
.08
$
.07
$
.33
$
.38
Adjusted Combined diluted earnings per
share*
$
.50
$
.44
14
%
$
2.63
$
2.90
(9
)%
*The sum of individual per share amounts
may not add due to rounding.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190830005054/en/
INVESTOR CONTACT: Ken Gosnell (856)
342-6081 ken_gosnell@campbellsoup.com
MEDIA CONTACT: Thomas Hushen (856)
342-5227 thomas_hushen@campbellsoup.com
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