Campbell Soup Earnings: Profit CLIMBS, Beating Analyst Estimate

S&P 500 (NYSE:SPY) component Campbell Soup Company (NYSE:CPB) reported net income above Wall Street’s expectations for the fourth quarter. Campbell Soup, with its consolidated subsidiaries, is a global manufacturer of convenience food products.

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Campbell Soup Company Earnings Cheat Sheet

Results: Net income for Campbell Soup Company rose to $127 million (40 cents per share) vs. $100 million (31 cents per share) in the same quarter a year earlier. This marks a rise of 27% from the year-earlier quarter.

Revenue: Rose 0.4% to $1.61 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Campbell Soup Company reported adjusted net income of 41 cents per share. By that measure, the company beat the mean estimate of 38 cents per share. It fell short of the average revenue estimate of $1.81 billion.

Quoting Management: Denise Morrison, Campbell’s President and Chief Executive Officer, said, “In the fourth quarter, we generated organic sales growth, with gains across most of our portfolio, including strong sales in U.S. Soup and U.S. Simple Meals. Retailers continue to respond favorably to our new product development, and we have started shipping new products for fiscal 2013 launches.”

Key Stats:

After four consecutive quarters of year-over-year profit drops, the company reported a profit increase last quarter. In the third quarter, net income fell 5.3% from the year earlier, while the figure fell 14.2% in the second quarter, 5% in the first quarter and 11.5% in the fourth quarter of the last fiscal year.

Last quarter marked the fifth straight quarter that the company saw shrinking gross margins, as gross margin fell 1.3 percentage points to 38.5% from the year-earlier quarter. Over that time, margins have contracted on average 1.2 percentage points per quarter on a year-over-year basis.

The company has now topped analyst estimates for the last four quarters. It beat the mark by 4 cents in the third quarter, by 2 cents in the second quarter, and by 2 cents in the first quarter.

The comapny’s revenue has not increased in each of the last two quarters. In the third quarter, revenue increased 0.4% to $1.82 billion from the year-earlier quarter.

Looking Forward: Analysts appear increasingly optimistic about the company’s results for the next quarter. The average estimate for the first quarter of the next fiscal year has moved up from 84 cents a share to 85 cents over the last thirty days. For the fiscal year, the average estimate has moved up from $2.38 a share to $2.40 over the last sixty days.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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