For the fourth quarter:
- Net Sales increased to $2.1 billion. Organic Net Sales
increased 5%.
- Earnings Before Interest and Taxes (EBIT) increased to $272
million. Adjusted EBIT decreased 10% to $242 million.
- Earnings Per Share (EPS) increased to $0.57. Adjusted EPS
decreased 11% to $0.50.
For the full year:
- Net Sales increased to $9.4 billion. Organic Net Sales
increased 10%.
- EBIT increased to $1.3 billion. Adjusted EBIT increased 5% to
$1.4 billion.
- EPS increased to $2.85. Adjusted EPS increased 5% to
$3.00.
- Returned $589 million to shareholders, including $447 million
in dividends.
- Sovos Brands, Inc. (Sovos Brands) acquisition is currently
expected to close by the end of December 2023.
Campbell Soup Company (NYSE:CPB) today reported results
for its fourth-quarter and full-year fiscal 2023 ended July 30,
2023.
CEO Comments
“We delivered a strong fiscal 2023 with both top and bottom-line
growth, exceeding our initial expectations and demonstrating
momentum against our strategic plan,” said Mark Clouse, Campbell's
President and CEO. “Looking ahead, we see fiscal 2024 as another
year of sustained growth and continued progress against our
strategic plan. We expect accelerated growth and margin improvement
in Snacks, and sequential and steady improvement in Meals &
Beverages throughout the year, and with the pending strategic
acquisition of Sovos Brands, Campbell will be one of the most
dependable, growth-oriented names in food.”
Three Months Ended
Twelve Months Ended
($ in millions, except per share)
July 30, 2023
July 31, 2022
% Change
July 30, 2023
July 31, 2022
% Change
Net Sales
As Reported (GAAP)
$2,068
$1,987
4%
$9,357
$8,562
9%
Organic
5%
10%
Earnings Before Interest and Taxes
(EBIT)
As Reported (GAAP)
$272
$170
60%
$1,312
$1,163
13%
Adjusted
$242
$269
(10)%
$1,367
$1,297
5%
Diluted Earnings Per Share
As Reported (GAAP)
$0.57
$0.32
78%
$2.85
$2.51
14%
Adjusted
$0.50
$0.56
(11)%
$3.00
$2.85
5%
Note: A detailed reconciliation of the reported (GAAP) financial
information to the adjusted financial information is included at
the end of this news release.
Items Impacting Comparability
The table below presents a summary of items impacting
comparability in each period. A detailed reconciliation of the
reported (GAAP) financial information to the adjusted information
is included at the end of this news release.
Diluted Earnings Per
Share
Three Months Ended
Twelve Months Ended
July 30, 2023
July 31, 2022
July 30, 2023
July 31, 2022
As Reported (GAAP)
$0.57
$0.32
$2.85
$2.51
Restructuring charges, implementation
costs and other related costs associated with cost savings
initiatives
$0.04
$0.04
$0.17
$0.08
Pension and postretirement actuarial
losses (gains)
$(0.10
)
$0.08
$(0.04
)
$0.11
Commodity mark-to-market adjustments
$(0.08
)
$0.13
$(0.05
)
$0.15
Accelerated amortization
$0.02
$—
$0.02
$—
Charges associated with divestiture
$0.04
$—
$0.04
$—
Transaction costs
$0.01
$—
$0.01
$—
Loss on debt extinguishment
$—
$—
$—
$0.01
Adjusted*
$0.50
$0.56
$3.00
$2.85
*Numbers may not add due to rounding.
Fourth-Quarter Results
Net sales in the quarter increased 4%. Organic net sales
increased 5% to $2.1 billion. The impact of inflation-driven net
price realization of 10% was partially offset by some unfavorable
volume / mix of 5%.
Gross profit increased to $656 million from $571 million. Gross
profit margin was 31.7% compared to 28.7%. Excluding items
impacting comparability, adjusted gross profit increased to $632
million from $622 million. Adjusted gross profit margin decreased
70 basis points, as expected, to 30.6% primarily driven by
unfavorable volume / mix, with net price realization and supply
chain productivity improvements more than offsetting higher cost
inflation and other supply chain costs.
Marketing and selling expenses increased 11% to $199 million and
represented approximately 10% of net sales. Excluding items
impacting comparability, adjusted marketing and selling expenses
increased 9% to $194 million and represented approximately 9% of
net sales in line with our objectives. The increase was driven by
higher advertising and consumer promotion expense (A&C), which
increased 23%, and higher selling expenses, partially offset by
increased benefits from cost savings initiatives.
Administrative expenses increased 2% to $167 million. Excluding
items impacting comparability, adjusted administrative expenses
increased 7% to $164 million primarily due to higher general
administrative costs and inflation, partially offset by increased
benefits from cost savings initiatives.
Other income was $9 million compared to other expenses of $31
million. Excluding items impacting comparability, adjusted other
expenses were $7 million compared to adjusted other income of $1
million primarily due to lower pension and postretirement benefit
income this year.
As reported EBIT increased to $272 million from $170 million.
Excluding items impacting comparability, adjusted EBIT decreased
10% to $242 million primarily due to higher adjusted strategic
marketing and selling expenses, higher adjusted administrative
expenses, and higher adjusted other expenses related to lower
pension and postretirement benefit income this year, partially
offset by higher adjusted gross profit.
Net interest expense was $47 million compared to $45 million.
The effective tax rate was 24.9% compared to 23.2%. Excluding items
impacting comparability, the adjusted effective tax rate decreased
to 23.1% compared to 24.1%.
As reported EPS increased to $0.57 per share compared to $0.32
per share. Excluding items impacting comparability, adjusted EPS
decreased $0.06, or 11%, to $0.50 per share compared to $0.56 per
share 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. Lower pension and postretirement
benefit income in the fourth quarter drove an approximate $0.02
impact to adjusted EPS as compared to the prior-year period.
Full-Year Results
Net sales increased 9% and organic net sales increased 10% to
$9.4 billion with the benefit of inflation-driven net price
realization more than offsetting unfavorable volume / mix.
As reported EBIT increased 13% to $1.31 billion. Excluding items
impacting comparability, adjusted EBIT increased 5% to $1.37
billion primarily due to higher adjusted gross profit, partially
offset by higher adjusted marketing and selling expenses, higher
adjusted other expenses, and higher adjusted administrative
expenses. Lower pension and postretirement benefit income this year
drove an approximate $44 million impact to adjusted EBIT.
Net interest expense was $184 million compared to $188 million.
Excluding items impacting comparability in the prior year, adjusted
net interest expense was $184 million. The effective tax rate was
23.9% compared to 22.4%. Excluding items impacting comparability,
the adjusted effective tax rate increased to 23.7% compared to
22.6% primarily due to the impact of state tax law changes in the
prior year.
As reported EPS increased to $2.85 per share compared to $2.51
per share. Excluding items impacting comparability, adjusted EPS
increased $0.15, or 5%, to $3.00, which was consistent with the
company's latest fiscal 2023 guidance and included an approximate
$0.11 impact from lower pension and postretirement benefit income.
Fiscal 2023 adjusted EPS increased from $2.85 per share in the
prior year 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.
Cash flow from operations was $1.1 billion compared to $1.2
billion primarily due to changes in working capital, partially
offset by higher cash earnings. Capital expenditures were $370
million compared to $242 million. In line with Campbell’s
commitment to return value to its shareholders, the company paid
$447 million of cash dividends and repurchased common stock of
approximately $142 million. At the end of the fourth quarter, the
company had approximately $301 million remaining under the current
$500 million strategic share repurchase program and approximately
$104 million remaining under its $250 million anti-dilutive share
repurchase program. As of fiscal year end, the company had
approximately $189 million in cash and cash equivalents and $1.85
billion available under its revolving credit facility.
Cost Savings Program from Continuing Operations
Through the fourth quarter, Campbell has achieved $890 million
of total savings under its multi-year cost savings program,
inclusive of Snyder’s-Lance synergies. The company remains on track
to deliver savings of $1 billion by the end of fiscal 2025.
Full-Year Fiscal 2024 Guidance:
Following a strong fiscal 2023, Campbell's full-year fiscal 2024
guidance reflects continued momentum against its strategic plan.
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. After the transaction closes, the
company expects to update guidance expectations for the combined
business.
Guidance reflects the following underlying assumptions:
- Net Sales growth reflecting:
- Volume declines expected in the first half of fiscal 2024 with
sequential improvement throughout the fiscal year leading to
positive trends in the second half;
- Expected lower contribution from pricing and disciplined levels
of promotional activity;
- More difficult first half top-line comparisons to prior year as
the company will lap double-digit net sales growth driven by
mid-teens inflation-driven pricing.
- Adjusted EBIT and adjusted EPS growth reflecting:
- An expectation of modest adjusted earnings growth and margin
progress in fiscal 2024, expected to be second half weighted, due
to an improving cost outlook throughout the year, benefiting from a
moderating inflationary environment and on-going productivity
improvements benefits;
- Continued inflation mitigation through a variety of levers
including productivity improvements of approximately 3% and cost
savings initiatives of approximately $35 to $40 million;
- A continued commitment to brand investments, with marketing and
selling expense as a percent of net sales expected at the low end
of its targeted 9-10% range, with a meaningful step-up in marketing
and selling spend in the first quarter compared to prior year;
- Division operating margins expected to improve overall for
fiscal 2024, with Snacks operating margin expected to be above 15%
and modest operating margin expansion in Meals & Beverages
expected in the second half of the fiscal year.
- Non-operating items:
- Campbell’s adjusted EBIT and adjusted EPS guidance includes an
estimated pre-tax headwind of approximately $13 million, or $0.03
per share, in fiscal 2024 related to lower pension and
postretirement benefit income, representing approximately 1% of
both adjusted EBIT and adjusted EPS growth. This impact is expected
be most pronounced in the first quarter of the fiscal year;
- The divestiture of the Emerald nuts business, which closed on
May 30, 2023, is estimated to reduce reported net sales growth by
approximately 0.5% and have an expected dilutive impact of $0.01 to
adjusted EPS in fiscal 2024.
- Other additional guidance assumptions can be found in the
accompanying investor presentation available at
investor.campbellsoupcompany.com/events-and-presentations.
The full-year fiscal 2024 guidance is set forth in the table
below:
FY2023 Results
FY2024 Guidance
($ in millions, except per share)
Net Sales
$9,357
(0.5)% to +1.5%
Organic Net Sales1
0% to +2%
Adjusted EBIT2
$1,367*
+3% to +5%
Adjusted EPS2
$3.00*
+3% to +5%
$3.09 to $3.15
* Adjusted - refer to the detailed
reconciliation of the reported (GAAP) financial information to the
adjusted financial information at the end of this news release.
1 Growth rate adjusted for the Emerald
nuts business, which was divested on May 30, 2023.
2 Adjusted EBIT in fiscal 2023 included
approximately $14 million and adjusted EPS included approximately
$0.04 of litigation expenses related to the Plum baby food and
snacks business, which was divested on May 3, 2021. We will exclude
these costs from our fiscal 2024 adjusted EBIT and adjusted EPS and
thereafter as we do not believe that these expenses reflect our
underlying operating performance.
Note: A non-GAAP reconciliation is not
provided for fiscal 2024 guidance as the company is unable to
reasonably estimate the full-year financial impact of items such as
actuarial gains or losses on pension and postretirement plans
because these impacts are dependent on future changes in market
conditions. The inability to predict the amount and timing of these
future items makes a detailed reconciliation of these
forward-looking financial measures impracticable.
Segment Operating Review
An analysis of net sales and operating earnings by reportable
segment follows:
Three
Months Ended July 30, 2023
($ in millions)
Meals & Beverages*
Snacks*
Total
Net Sales, as Reported
$936
$1,132
$2,068
Volume/Mix
(5)%
(5)%
(5)%
Net Price Realization
6%
13%
10%
Organic Net Sales
1%
9%
5%
Currency
—%
—%
—%
Divestiture1
—%
(1)%
(1)%
% Change vs. Prior Year
—%
8%
4%
Segment Operating Earnings
$132
$158
% Change vs. Prior Year
(18)%
12%
*Numbers do not add due to rounding.
1 Reflects the loss of net sales
associated with the divestiture of the Emerald nuts business, which
was completed on May 30, 2023.
Note: A detailed reconciliation of the
reported (GAAP) net sales to organic net sales is included at the
end of this news release.
Twelve
Months Ended July 30, 2023
($ in millions)
Meals & Beverages*
Snacks
Total*
Net Sales, as Reported
$4,907
$4,450
$9,357
Volume/Mix
(5)%
(2)%
(4)%
Net Price Realization
12%
15%
13%
Organic Net Sales
7%
13%
10%
Currency
(1)%
—%
—%
Divestiture1
—%
—%
—%
% Change vs. Prior Year
7%
13%
9%
Segment Operating Earnings
$894
$640
% Change vs. Prior Year
2%
24%
*Numbers do not add due to rounding.
1 Reflects the loss of net sales
associated with the divestiture of the Emerald nuts business, which
was completed on May 30, 2023.
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
Net sales in the quarter were flat. Organic net sales increased
1% as increases in foodservice and Prego pasta sauces were
partially offset by declines in beverages, U.S. soup and Canada.
Net price realization of 6% was partially offset by modestly
unfavorable volume / mix of 5%. Sales of U.S. soup decreased 2%
primarily due to declines in ready-to-serve soups, partially offset
by strong increases in broth and modest increases in condensed.
Operating earnings in the quarter decreased 18% primarily due to
lower gross profit. Gross profit margin decreased due to higher
cost inflation and other supply chain costs, as well as modestly
unfavorable volume / mix, partially offset by net price realization
and supply chain productivity improvements.
Snacks
Net sales in the quarter increased 8% and organic net sales
increased 9% driven by sales of its 8 power brands, which were up
13%. Sales growth was driven by increases in cookies and crackers,
primarily Goldfish crackers and Lance sandwich crackers, and in
salty snacks, primarily Kettle Brand and Cape Cod potato chips.
Sales benefited from net price realization of 13%, partially offset
by modestly unfavorable volume / mix of 5%.
Operating earnings in the quarter increased 12% primarily due to
higher gross profit, partially offset by higher marketing and
selling expenses as well as higher administrative expenses. Gross
profit margin increased due to the impact of net price realization
and supply chain productivity improvements more than offsetting
higher cost inflation and other supply chain costs as well as
unfavorable volume / mix.
Corporate
Corporate expense was $17 million in the fourth quarter of
fiscal 2023 compared to $127 million in the prior year.
Corporate expense in the current quarter included the
following:
- $41 million of pension and postretirement actuarial gains;
- $30 million of unrealized mark-to-market gains on outstanding
undesignated commodity hedges;
- $15 million of costs related to cost savings initiatives;
- $13 million loss from the sale of the Emerald nuts
business;
- $7 million of accelerated amortization; and
- $5 million of transaction costs associated with the pending
acquisition of Sovos Brands.
Corporate expense in the fourth quarter of fiscal 2022
included:
- $51 million of unrealized mark-to-market losses on outstanding
undesignated commodity hedges;
- $32 million of pension and postretirement actuarial losses;
and
- $11 million of costs related to cost savings initiatives.
After factoring in these items, the remaining increase in
Corporate expense was primarily due to lower pension and
postretirement benefit income and higher administrative
expenses.
Conference Call and Webcast
Campbell will host a conference call to discuss these results
today at 8:00 a.m. Eastern Time. Participants calling from the U.S.
may dial in using the toll-free phone number (888) 210-3346.
Participants calling from outside the U.S. may dial in using phone
number +1 (646) 960-0253. The conference access code is 2518868. In
addition to dial-in, access to a live listen-only audio webcast and
accompanying slide presentation, as well as a replay of the
webcast, will be available at
investor.campbellsoupcompany.com/events-and-presentations.
Reportable Segments
Campbell Soup Company earnings results are reported as
follows:
Meals & Beverages, which consists
of our soup, simple meals and beverage products in retail and
foodservice in 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 and non-dairy
beverages; Prego pasta sauces; Pace Mexican sauces; Campbell’s
gravies, pasta, beans and dinner sauces; Swanson canned poultry; V8
juices and beverages; and Campbell’s tomato juice. The segment also
includes snacking products in foodservice and Canada.
Snacks, which consists of Pepperidge
Farm cookies*, crackers, fresh bakery and frozen products,
including Goldfish crackers*, Snyder’s of Hanover pretzels*, Lance
sandwich crackers*, Cape Cod potato chips*, Kettle Brand potato
chips*, Late July snacks*, Snack Factory pretzel crisps*, Pop
Secret popcorn, and other snacking products in retail in the U.S.
We refer to the * brands as our "power brands." The segment also
includes the retail business in Latin America. The segment included
the results of our Emerald nuts business, which was sold on May 30,
2023.
About Campbell
For more than 150 years, Campbell (NYSE:CPB) has been connecting
people through food they love. Generations of consumers have
trusted us to provide delicious and affordable food and beverages.
Headquartered in Camden, N.J. since 1869, the company generated
fiscal 2023 net sales of $9.4 billion. Our portfolio includes
iconic brands such as Campbell’s, Cape Cod, Goldfish, Kettle Brand,
Lance, Late July, Milano, Pace, Pacific Foods, Pepperidge Farm,
Prego, Snyder’s of Hanover, Swanson and V8. Campbell has a heritage
of giving back and acting as a good steward of the environment. The
company is a member of the Standard & Poor's 500 as well as the
FTSE4Good and Bloomberg Gender-Equality Indices. For more
information, visit www.campbellsoupcompany.com.
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:
the conditions to the completion of the Sovos Brands, Inc. (“Sovos
Brands”) transaction, including obtaining Sovos Brands shareholder
approval, may not be satisfied, or the regulatory approvals
required for the transaction may not be obtained on the terms
expected, on the anticipated schedule, or at all; long-term
financing for the Sovos Brands transaction may not be obtained on
favorable terms, or at all; closing of the Sovos Brands transaction
may not occur or be delayed, either as a result of litigation
related to the transaction or otherwise or result in significant
costs of defense, indemnification and liability; the risk that the
cost savings and any other synergies from the Sovos Brands
transaction may not be fully realized or may take longer or cost
more to be realized than expected, including that the Sovos Brands
transaction may not be accretive within the expected timeframe or
the extent anticipated; completing the Sovos Brands transaction may
distract our management from other important matters; the risks
related to the availability of, and cost inflation in, supply chain
inputs, including labor, raw materials, commodities, packaging and
transportation; the company’s ability to execute on and realize the
expected benefits from its strategy, including growing sales in
snacks and growing/maintaining its market share position in soup;
the impact of strong competitive responses to the company’s efforts
to leverage its brand power with product innovation, promotional
programs and new advertising; the risks associated with trade and
consumer acceptance of product improvements, shelving initiatives,
new products and pricing and promotional strategies; the ability to
realize projected cost savings and benefits from cost savings
initiatives and the integration of recent acquisitions; disruptions
in or inefficiencies to the company’s supply chain and/or
operations, including reliance on key supplier relationships; the
risks related to the effectiveness of the company's hedging
activities and the company's ability to respond to volatility in
commodity prices; the impacts of, and associated responses to, the
COVID-19 pandemic on our business, suppliers, customers, consumers
and employees; 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; changes in consumer demand for the company’s
products and favorable perception of the company’s brands; changing
inventory management practices by certain of the company’s key
customers; 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; product quality and safety issues, including recalls and
product liabilities; 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; the
uncertainties of litigation and regulatory actions against the
company; the costs, disruption and diversion of management’s
attention associated with activist investors; a disruption, failure
or security breach of the company’s or the company's vendors'
information technology systems, including ransomware attacks;
impairment to goodwill or other intangible assets; the company’s
ability to protect its intellectual property rights; increased
liabilities and costs related to the company’s defined benefit
pension plans; the company’s ability to attract and retain key
talent; goals and initiatives related to, and the impacts of,
climate change, including weather-related events; negative changes
and volatility in financial and credit markets, deteriorating
economic conditions and other external factors, including changes
in laws and regulations; unforeseen business disruptions or other
impacts due to political instability, civil disobedience,
terrorism, armed hostilities (including the ongoing conflict
between Russia and Ukraine), extreme weather conditions, natural
disasters, other pandemics or other calamities; and 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 30, 2023
July 31, 2022
Net sales
$
2,068
$
1,987
Costs and expenses
Cost of products sold
1,412
1,416
Marketing and selling expenses
199
179
Administrative expenses
167
163
Research and development expenses
26
23
Other expenses / (income)
(9
)
31
Restructuring charges
1
5
Total costs and expenses
1,796
1,817
Earnings before interest and taxes
272
170
Interest, net
47
45
Earnings before taxes
225
125
Taxes on earnings
56
29
Net earnings
169
96
Net loss attributable to noncontrolling
interests
—
—
Net earnings attributable to Campbell Soup
Company
$
169
$
96
Per share - basic
Net earnings attributable to Campbell Soup
Company
$
.57
$
.32
Weighted average shares outstanding -
basic
298
300
Per share - assuming dilution
Net earnings attributable to Campbell Soup
Company
$
.57
$
.32
Weighted average shares outstanding -
assuming dilution
299
302
CAMPBELL SOUP COMPANY
CONSOLIDATED STATEMENTS OF
EARNINGS
(millions, except per share
amounts)
Twelve Months Ended
July 30, 2023
July 31, 2022
Net sales
$
9,357
$
8,562
Costs and expenses
Cost of products sold
6,440
5,935
Marketing and selling expenses
811
734
Administrative expenses
654
617
Research and development expenses
92
87
Other expenses / (income)
32
21
Restructuring charges
16
5
Total costs and expenses
8,045
7,399
Earnings before interest and taxes
1,312
1,163
Interest, net
184
188
Earnings before taxes
1,128
975
Taxes on earnings
270
218
Net earnings
858
757
Net loss attributable to noncontrolling
interests
—
—
Net earnings attributable to Campbell Soup
Company
$
858
$
757
Per share - basic
Net earnings attributable to Campbell Soup
Company
$
2.87
$
2.51
Weighted average shares outstanding -
basic
299
301
Per share - assuming dilution
Net earnings attributable to Campbell Soup
Company
$
2.85
$
2.51
Weighted average shares outstanding -
assuming dilution
301
302
CAMPBELL SOUP COMPANY
CONSOLIDATED SUPPLEMENTAL
SCHEDULE OF SALES AND EARNINGS (unaudited)
(millions, except per share
amounts)
Three Months Ended
July 30, 2023
July 31, 2022
Percent Change
Sales
Contributions:
Meals & Beverages
$
936
$
935
—
%
Snacks
1,132
1,052
8
%
Total sales
$
2,068
$
1,987
4
%
Earnings
Contributions:
Meals & Beverages
$
132
$
161
(18
)%
Snacks
158
141
12
%
Total operating earnings
290
302
(4
)%
Corporate income (expense)
(17
)
(127
)
Restructuring charges
(1
)
(5
)
Earnings before interest and taxes
272
170
60
%
Interest, net
47
45
Taxes on earnings
56
29
Net earnings
169
96
76
%
Net loss attributable to noncontrolling
interests
—
—
Net earnings attributable to Campbell Soup
Company
$
169
$
96
76
%
Per share - assuming dilution
Net earnings attributable to Campbell Soup
Company
$
.57
$
.32
78
%
CAMPBELL SOUP COMPANY
CONSOLIDATED SUPPLEMENTAL
SCHEDULE OF SALES AND EARNINGS
(millions, except per share
amounts)
Twelve Months Ended
July 30, 2023
July 31, 2022
Percent Change
Sales
Contributions:
Meals & Beverages
$
4,907
$
4,607
7
%
Snacks
4,450
3,955
13
%
Total sales
$
9,357
$
8,562
9
%
Earnings
Contributions:
Meals & Beverages
$
894
$
874
2
%
Snacks
640
517
24
%
Total operating earnings
1,534
1,391
10
%
Corporate income (expense)
(206
)
(223
)
Restructuring charges
(16
)
(5
)
Earnings before interest and taxes
1,312
1,163
13
%
Interest, net
184
188
Taxes on earnings
270
218
Net earnings
858
757
13
%
Net loss attributable to noncontrolling
interests
—
—
Net earnings attributable to Campbell Soup
Company
$
858
$
757
13
%
Per share - assuming dilution
Net earnings attributable to Campbell Soup
Company
$
2.85
$
2.51
14
%
CAMPBELL SOUP COMPANY
CONDENSED CONSOLIDATED BALANCE
SHEETS
(millions)
July 30, 2023
July 31, 2022
Current assets
$
2,061
$
1,963
Plant assets, net
2,398
2,343
Intangible assets, net
7,107
7,177
Other assets
492
409
Total assets
$
12,058
$
11,892
Current liabilities
$
2,222
$
2,886
Long-term debt
4,498
3,996
Other liabilities
1,675
1,677
Total equity
3,663
3,333
Total liabilities and equity
$
12,058
$
11,892
Total debt
$
4,689
$
4,810
Total cash and cash equivalents
$
189
$
109
CAMPBELL SOUP COMPANY
CONSOLIDATED STATEMENTS OF CASH
FLOWS
(millions)
Twelve Months Ended
July 30, 2023
July 31, 2022
Cash flows from operating activities:
Net earnings
$
858
$
757
Adjustments to reconcile net earnings to
operating cash flow
Restructuring charges
16
5
Stock-based compensation
63
59
Pension and postretirement benefit
income
(22
)
(7
)
Depreciation and amortization
387
337
Deferred income taxes
(5
)
21
Net loss on sale of business
13
—
Loss on extinguishment of debt
—
4
Other
100
88
Changes in working capital, net of
divestiture
Accounts receivable
(1
)
48
Inventories
(64
)
(314
)
Other current assets
13
25
Accounts payable and accrued
liabilities
(164
)
200
Other
(51
)
(42
)
Net cash provided by operating
activities
1,143
1,181
Cash flows from investing activities:
Purchases of plant assets
(370
)
(242
)
Purchases of route businesses
(13
)
(1
)
Sales of route businesses
1
2
Sale of business
41
—
Other
1
11
Net cash used in investing activities
(340
)
(230
)
Cash flows from financing activities:
Short-term borrowings, including
commercial paper
3,677
1,173
Short-term repayments, including
commercial paper
(3,749
)
(997
)
Long-term borrowings
500
—
Long-term repayments
(566
)
—
Dividends paid
(447
)
(451
)
Treasury stock purchases
(142
)
(167
)
Treasury stock issuances
22
3
Payments related to tax withholding for
stock-based compensation
(19
)
(18
)
Payments related to extinguishment of
debt
—
(453
)
Other
1
—
Net cash used in financing activities
(723
)
(910
)
Effect of exchange rate changes on
cash
—
(1
)
Net change in cash and cash
equivalents
80
40
Cash and cash equivalents — beginning of
period
109
69
Cash and cash equivalents — end of
period
$
189
$
109
Reconciliation of GAAP to Non-GAAP Financial
Measures Fiscal Year Ended July 30, 2023
Campbell Soup Company (the "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. Management
considers quantitative and qualitative factors in assessing whether
to adjust for the impact of items that may be significant or that
could affect an understanding of the company’s performance and
trends in its underlying operating results. The adjustments on
earnings may include but are not limited to items such as: unusual
or non-recurring gains or charges; restructuring charges and
related costs; actuarial gains or losses on pension and
postretirement plans; unrealized mark-to-market gains and losses on
outstanding undesignated commodity hedges; gains or losses on the
extinguishment of debt; gains or losses on divestitures;
transaction costs; impairment charges or accelerated amortization.
Depending upon facts or circumstances, management may change these
adjustments. When these adjustments change, the company will
provide updated definitions of its non-GAAP financial measures.
When items no longer impact the company’s current or future
presentation of non-GAAP operating results, the company will remove
these items from its non-GAAP definitions.
Organic Net Sales
Organic net sales are net sales excluding the impact of
currency, acquisitions and divestitures. 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
follows.
Three Months Ended
July 30, 2023
July 31, 2022
% Change
(millions)
Net Sales, as
Reported
Impact of Currency
Organic Net Sales
Net Sales, as
Reported
Impact of Divestiture
Organic Net Sales
Net Sales, as
Reported
Organic Net Sales
Meals & Beverages
$
936
$
4
$
940
$
935
$
—
$
935
—
%
1
%
Snacks
1,132
(1
)
1,131
1,052
(13
)
1,039
8
%
9
%
Total Net Sales
$
2,068
$
3
$
2,071
$
1,987
$
(13
)
$
1,974
4
%
5
%
Twelve Months Ended
July 30, 2023
July 31, 2022
% Change
(millions)
Net Sales, as
Reported
Impact of Currency
Organic Net Sales
Net Sales, as
Reported
Impact of Divestiture
Organic Net Sales
Net Sales, as
Reported
Organic Net Sales
Meals & Beverages
$
4,907
$
27
$
4,934
$
4,607
$
—
$
4,607
7
%
7
%
Snacks
4,450
(2
)
4,448
3,955
(13
)
3,942
13
%
13
%
Total Net Sales
$
9,357
$
25
$
9,382
$
8,562
$
(13
)
$
8,549
9
%
10
%
Twelve Months Ended
July 30, 2023
(millions)
Net Sales, as
Reported
Impact of Divestiture
Organic Net Sales for
FY 2024 Guidance
Meals & Beverages
$
4,907
$
—
$
4,907
Snacks
4,450
(51
)
4,399
Total Net Sales
$
9,357
$
(51
)
$
9,306
Items Impacting Earnings
Adjusted Net earnings are net earnings excluding the impact of
restructuring charges and related costs, actuarial gains or losses
on pension and postretirement plans, unrealized mark-to-market
gains or losses on outstanding undesignated commodity hedges,
accelerated amortization, gains or losses on divestitures,
transaction costs, and losses on the extinguishment of debt.
Management 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, management believes that
investors may be able to better understand its results excluding
these items.
The following items impacted earnings:
(1)
The company has implemented several cost
savings initiatives in recent years.
In the fourth quarter of fiscal 2023, the
company recorded Restructuring charges of $1 million and
implementation costs and other related costs of $6 million in Cost
of products sold, $5 million in Marketing and selling expenses, $3
million in Administrative expenses, and $1 million in Research and
development expenses (aggregate impact of $13 million after tax, or
$.04 per share) related to these initiatives. In the fourth quarter
of fiscal 2022, the company recorded Restructuring charges of $5
million and implementation costs and other related costs of $10
million in Administrative expenses and $1 million in Marketing and
selling expenses (aggregate impact of $12 million after tax, or
$.04 per share) related to these initiatives. In fiscal 2023, the
company recorded Restructuring charges of $16 million and
implementation costs and other related costs of $24 million in
Administrative expenses, $18 million in Cost of products sold, $5
million in Marketing and selling expenses and $3 million in
Research and development expenses (aggregate impact of $50 million
after tax, or $.17 per share) related to these initiatives. In
fiscal 2022, the company recorded Restructuring charges of $5
million and implementation costs and other related costs of $20
million in Administrative expenses, $5 million in Cost of products
sold and $1 million in Marketing and selling expenses (aggregate
impact of $24 million after tax, or $.08 per share) related to
these initiatives.
(2)
In the fourth quarter of fiscal 2023, the
company recognized actuarial gains on pension and postretirement
plans in Other expenses / (income) of $41 million ($31 million
after tax, or $.10 per share). In the fourth quarter of fiscal
2022, the company recognized actuarial losses on pension and
postretirement plans in Other expenses / (income) of $32 million
($24 million after tax, or $.08 per share). In fiscal 2023, the
company recognized actuarial gains on pension and postretirement
plans in Other expenses / (income) of $15 million ($11 million
after tax, or $.04 per share). In fiscal 2022, the company
recognized actuarial losses on pension and postretirement plans in
Other expenses / (income) of $44 million ($33 million after tax, or
$.11 per share).
(3)
In the fourth quarter of fiscal 2023, the
company recognized gains in Cost of products sold of $30 million
($23 million after tax, or $.08 per share) associated with
unrealized mark-to-market adjustments on outstanding undesignated
commodity hedges. In the fourth quarter of fiscal 2022, the company
recognized losses in Cost of products sold of $51 million ($38
million after tax, or $.13 per share) associated with unrealized
mark-to-market adjustments on outstanding undesignated commodity
hedges. In fiscal 2023, the company recognized gains in Cost of
products sold of $21 million ($16 million after tax, or $.05 per
share) associated with unrealized mark-to-market adjustments on
outstanding undesignated commodity hedges. In fiscal 2022, the
company recognized losses in Cost of products sold of $59 million
($44 million after tax, or $.15 per share) associated with
unrealized mark-to-market adjustments on outstanding undesignated
commodity hedges.
(4)
In the fourth quarter of fiscal 2023, the
company recorded accelerated amortization expense in Other expenses
/ (income) of $7 million ($5 million after tax, or $.02 per share)
related to customer relationship intangible assets due to the loss
of certain contract manufacturing customers.
(5)
In the fourth quarter of fiscal 2023, the
company recorded a pre- and after-tax loss in Other expenses /
(income) of $13 million ($.04 per share) on the sale of its Emerald
nuts business.
(6)
In the first quarter of fiscal 2024, the
company announced its intent to acquire Sovos Brands, Inc. In the
fourth quarter of fiscal 2023, the company incurred transaction
costs in Other expenses / (income) of $5 million ($4 million after
tax, or $.01 per share) associated with the pending acquisition,
which the company currently expects to close by the end of December
2023.
(7)
In fiscal 2022, the company recorded a
loss in Interest expense of $4 million ($3 million after tax, or
$.01 per share) on the extinguishment of debt.
The following tables reconcile financial information, presented
in accordance with GAAP, to financial information excluding certain
items:
Three Months Ended
July 30, 2023
July 31, 2022
(millions, except per share amounts)
As reported
Adjustments(a)
Adjusted
As reported
Adjustments(a)
Adjusted
Adjusted Percent
Change
Gross profit
$
656
$
(24
)
$
632
$
571
$
51
$
622
2%
Gross profit margin
31.7
%
30.6
%
28.7
%
31.3
%
(70) pts
Marketing and selling expenses
199
(5
)
194
179
(1
)
178
9%
As a percentage of Net sales
10
%
9
%
9
%
9
%
Administrative expenses
167
(3
)
164
163
(10
)
153
7%
Research and development expenses
26
(1
)
25
23
—
23
Other expenses / (income)
(9
)
16
7
31
(32
)
(1
)
Restructuring charges
1
(1
)
—
5
(5
)
—
Earnings before interest and taxes
$
272
$
(30
)
$
242
$
170
$
99
$
269
(10)%
Interest, net
47
—
47
45
—
45
4%
Earnings before taxes
$
225
$
(30
)
$
195
$
125
$
99
$
224
Taxes
56
(11
)
45
29
25
54
Effective income tax rate
24.9
%
23.1
%
23.2
%
24.1
%
(100) pts
Net earnings attributable to Campbell Soup
Company
$
169
$
(19
)
$
150
$
96
$
74
$
170
(12)%
Diluted net earnings per share
attributable to Campbell Soup Company*
$
.57
$
(.06
)
$
.50
$
.32
$
.25
$
.56
(11)%
(a) See following tables for
additional information.
*The sum of individual per share amounts may not add due to
rounding.
Three Months Ended
July 30, 2023
(millions, except per share amounts)
Restructuring charges,
implementation costs and other related costs (1)
Pension and postretirement
adjustments (2)
Commodity mark-to- market
(3)
Accelerated amortization
(4)
Divestiture (5)
Transaction costs
(6)
Adjustments
Gross profit
$
6
$
—
$
(30
)
$
—
$
—
$
—
$
(24
)
Marketing and selling expenses
(5
)
—
—
—
—
—
(5
)
Administrative expenses
(3
)
—
—
—
—
—
(3
)
Research and development expenses
(1
)
—
—
—
—
—
(1
)
Other expenses / (income)
—
41
—
(7
)
(13
)
(5
)
16
Restructuring charges
(1
)
—
—
—
—
—
(1
)
Earnings before interest and taxes
$
16
$
(41
)
$
(30
)
$
7
$
13
$
5
$
(30
)
Interest, net
—
—
—
—
—
—
—
Earnings before taxes
$
16
$
(41
)
$
(30
)
$
7
$
13
$
5
$
(30
)
Taxes
3
(10
)
(7
)
2
—
1
(11
)
Net earnings attributable to Campbell Soup
Company
$
13
$
(31
)
$
(23
)
$
5
$
13
$
4
$
(19
)
Diluted net earnings per share
attributable to Campbell Soup Company*
$
.04
$
(.10
)
$
(.08
)
$
.02
$
.04
$
.01
$
(.06
)
*The sum of individual per share amounts may not add due to
rounding.
Three Months Ended
July 31, 2022
(millions, except per share amounts)
Restructuring charges,
implementation costs and other related costs (1)
Pension and postretirement
adjustments (2)
Commodity mark-to- market
(3)
Adjustments
Gross profit
$
—
$
—
$
51
$
51
Marketing and selling expenses
(1
)
—
—
(1
)
Administrative expenses
(10
)
—
—
(10
)
Other expenses / (income)
—
(32
)
—
(32
)
Restructuring charges
(5
)
—
—
(5
)
Earnings before interest and taxes
$
16
$
32
$
51
$
99
Interest, net
—
—
—
—
Earnings before taxes
$
16
$
32
$
51
$
99
Taxes
4
8
13
25
Net earnings attributable to Campbell Soup
Company
$
12
$
24
$
38
$
74
Diluted net earnings per share
attributable to Campbell Soup Company
$
.04
$
.08
$
.13
$
.25
Twelve Months Ended
July 30, 2023
July 31, 2022
(millions, except per share amounts)
As reported
Adjustments(a)
Adjusted
As reported
Adjustments(a)
Adjusted
Adjusted Percent
Change
Gross profit
$
2,917
$
(3
)
$
2,914
$
2,627
$
64
$
2,691
8%
Gross profit margin
31.2
%
31.1
%
30.7
%
31.4
%
(30) pts
Marketing and selling expenses
811
(5
)
806
734
(1
)
733
10%
As a percentage of Net sales
9
%
9
%
9
%
9
%
Administrative expenses
654
(24
)
630
617
(20
)
597
6%
Research and development expenses
92
(3
)
89
87
—
87
Other expenses / (income)
32
(10
)
22
21
(44
)
(23
)
Restructuring charges
16
(16
)
—
5
(5
)
—
Earnings before interest and taxes
$
1,312
$
55
$
1,367
$
1,163
$
134
$
1,297
5%
Interest, net
184
—
184
188
(4
)
184
—%
Earnings before taxes
$
1,128
$
55
$
1,183
$
975
$
138
$
1,113
Taxes
270
10
280
218
34
252
Effective income tax rate
23.9
%
23.7
%
22.4
%
22.6
%
110 pts
Net earnings attributable to Campbell Soup
Company
$
858
$
45
$
903
$
757
$
104
$
861
5%
Diluted net earnings per share
attributable to Campbell Soup Company
$
2.85
$
.15
$
3.00
$
2.51
$
.34
$
2.85
5%
(a) See following tables for
additional information.
Twelve Months Ended
July 30, 2023
(millions, except per share amounts)
Restructuring charges,
implementation costs and other related costs (1)
Pension and postretirement
adjustments (2)
Commodity mark-to- market
(3)
Accelerated amortization
(4)
Divestiture (5)
Transaction costs
(6)
Adjustments
Gross profit
$
18
$
—
$
(21
)
$
—
$
—
$
—
$
(3
)
Marketing and selling expenses
(5
)
—
—
—
—
—
(5
)
Administrative expenses
(24
)
—
—
—
—
—
(24
)
Research and development expenses
(3
)
—
—
—
—
—
(3
)
Other expenses / (income)
—
15
—
(7
)
(13
)
(5
)
(10
)
Restructuring charges
(16
)
—
—
—
—
—
(16
)
Earnings before interest and taxes
$
66
$
(15
)
$
(21
)
$
7
$
13
$
5
$
55
Interest, net
—
—
—
—
—
—
—
Earnings before taxes
$
66
$
(15
)
$
(21
)
$
7
$
13
$
5
$
55
Taxes
16
(4
)
(5
)
2
—
1
10
Net earnings attributable to Campbell Soup
Company
$
50
$
(11
)
$
(16
)
$
5
$
13
$
4
$
45
Diluted net earnings per share
attributable to Campbell Soup Company
$
.17
$
(.04
)
$
(.05
)
$
.02
$
.04
$
.01
$
.15
Twelve Months Ended
July 31, 2022
(millions, except per share amounts)
Restructuring charges,
implementation costs and other related costs (1)
Pension and postretirement
adjustments (2)
Commodity mark-to- market
(3)
Loss on debt
extinguishment (7)
Adjustments
Gross profit
$
5
$
—
$
59
$
—
$
64
Marketing and selling expenses
(1
)
—
—
—
(1
)
Administrative expenses
(20
)
—
—
—
(20
)
Other expenses / (income)
—
(44
)
—
—
(44
)
Restructuring charges
(5
)
—
—
—
(5
)
Earnings before interest and taxes
$
31
$
44
$
59
$
—
$
134
Interest, net
—
—
—
(4
)
(4
)
Earnings before taxes
$
31
$
44
$
59
$
4
$
138
Taxes
7
11
15
1
34
Net earnings attributable to Campbell Soup
Company
$
24
$
33
$
44
$
3
$
104
Diluted net earnings per share
attributable to Campbell Soup Company*
$
.08
$
.11
$
.15
$
.01
$
.34
*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/20230830114536/en/
INVESTOR: Rebecca Gardy (856)
342-6081 rebecca_gardy@campbells.com
MEDIA: James Regan (856) 219-6409
James_Regan@campbells.com
Campbell Soup (NYSE:CPB)
Historical Stock Chart
From Oct 2024 to Nov 2024
Campbell Soup (NYSE:CPB)
Historical Stock Chart
From Nov 2023 to Nov 2024
