Campbell Soup Company (NYSE:CPB) shares are trading sharply lower Wednesday morning after the company reported worse-than-expected third-quarter EPS and sales results and cut FY21 EPS guidance below estimates.
Campbell Soup is a leading manufacturer and marketer of branded convenience food products, most notably soup. The firm's product assortment includes well-known brands like Campbell's, Pace, Prego, Swanson, V8 and Pepperidge Farm. Following the sale of its international snacking operations, the firm derives nearly all of its sales from its home turf.
Net sales proved to be $1.984 billion, compared to $6.6 billion in the prior-year quarter, as a result of lapping the demand surge at the onset of the pandemic in the prior year. Earnings
Before Interest and Taxes, came in at $272 million, compared to $1.1 billion in the prior-year quarter.
Campbell has made a handful of acquisitions to reshape its product mix the past few years, including the tie-up with Snyder's-Lance which stands to enhance its exposure to the faster-growing on-trend snack food aisle, complementing its Pepperidge Farm lineup
CEO Mark Clouse: "While we recognized the third quarter would be a challenging net sales comparison to the demand surge at the onset of the COVID-19 pandemic a year ago, we faced additional headwinds. Our results were impacted by a rising inflationary environment, short-term increases in supply chain costs, and some executional pressures as we continued to advance our transformation agenda, primarily in our Snacks division.
"We are confident that these are all addressable, and we are taking appropriate actions, including putting pricing in place for the next fiscal year. Our confidence is further strengthened by the underlying health of our brands."
CPB shares decreased $3.46, or 7%, to $45.66.
