Campbell Soup Company Reports FourthQuarter and FullYear Fiscal 2024 Financial Results
Intellectia.AI Updated: 2024-08-29
Campbell Soup Company Reports Fourth-Quarter and Full-Year Fiscal 2024 Financial Results
Campbell Soup Company (NASDAQ: CPB) today reported its financial results for the fourth quarter and full-year fiscal 2024, which ended on July 28, 2024.
Key Financial Metrics
| Metric | Actual 4Q24 | YoY Change | QoQ Change | Consensus Estimate | Actual FY24 | YoY Change | Consensus FY24 |
|---|---|---|---|---|---|---|---|
| Revenue | $2.3 billion | +11% | Increase | $2.31 billion | $9.6 billion | +3% | $9.66 billion |
| Adjusted EPS | $0.63 | +26% | Increase | $0.62 | $3.08 | +3% | $3.08 |
| EBIT | $77 million | -72% | Decrease | - | $1 billion | -24% | - |
| Adjusted EBIT | $329 million | +36% | Increase | - | $1.5 billion | +6% | - |
Interpretation: Campbell Soup Company reported a solid revenue increase driven primarily by the acquisition of Sovos Brands. The company saw significant year-over-year growth in adjusted EPS and EBIT. The additions from the acquisition and sequential volume improvement contributed to a notable financial performance, surpassing Wall Street’s EPS estimates for the quarter and meeting estimates for the full year.
Segment Performance
| Segment | Actual 4Q24 Revenue | YoY Change | Performance Insights |
|---|---|---|---|
| Meals & Beverages | $X | +28% | Revenues were boosted by the Sovos Brands acquisition with gains in U.S. Soup, foodservice, and Prego pasta sauces. |
| Snacks | $X | -3% | Decline due to lower net price realization and higher supply chain costs, offset by lower marketing and selling expenses. |
Interpretation: The Meals & Beverages segment showed outstanding performance, with substantial growth driven by the recent acquisition and robust sales in key categories. However, the Snacks segment faced challenges with reduced net price realization and increased supply chain costs, though marketing and selling expense improvements helped mitigate some losses.
Operational Highlights
- Sequential volume improvement and margin expansion in the fourth quarter.
- Successful integration of Sovos Brands, aiding in the transformation of the Meals & Beverages segment.
- Advanced Snacks margin improvement and significant innovation in sales and marketing.
- Outlined upcoming strategic direction to be detailed at Investor Day on September 10, 2024.
CEO Comments
Mark Clouse, President and CEO, praised the team for delivering strong results amid a dynamic environment. He highlighted impressive volume improvements and margin expansions, especially in the Meals & Beverages segment, noting the exceptional performance in soup recovery and the benefits of the Sovos Brands acquisition. Clouse expressed confidence in continued progress for fiscal 2025 and beyond, citing robust brand strength and competitive supply chain advantages.
Dividends and Share Repurchase Program
- Returned $512 million to shareholders, including $445 million in dividends.
- Repurchased approximately $67 million in common stock.
- The company has $301 million remaining under its current $500 million strategic share repurchase program and $37 million under the $250 million anti-dilutive share repurchase program.
Forward Guidance
- Fiscal 2025 revenue is expected to grow 9% to 11%, considering a full twelve-month contribution from Sovos Brands and the loss of Pop Secret business.
- Adjusted EBIT is projected to grow 9% to 11%.
- Adjusted EPS growth forecasted at 1% to 4%.
- Adjusted net interest expense anticipated to be between $350 million and $355 million.
Stock Price Movement
- Following the earnings release, Campbell Soup Company's stock declined by 2.38%.
Summary: Campbell Soup Company has demonstrated solid quarterly results with significant gains from strategic acquisitions, despite some operational challenges. The continued integration of Sovos Brands is expected to further enhance their performance, and the company is set to address future growth plans at the upcoming investor day. The stock market’s initial reaction shows a slight dip, which may be due to overall market conditions or investor expectations.
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