Consumer Staples
Packaged Foods
$12.07B
14K
The Campbell's Company, together with its subsidiaries, manufactures and markets food and beverage products in the United States and internationally. The company operates through Meals & Beverages and Snacks segments. The Meals & Beverages segment engages in the retail and foodservice businesses in the United States and Canada. This segment provides 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; Campbell’s tomato juice; Rao's pasta sauces, dry pasta, frozen entrées, frozen pizza and soups; Michael Angelo's frozen entrées and pasta sauces; and noosa yogurts, as well as snacking products in foodservice in Canada. The Snacks segment retails Pepperidge Farm cookies, crackers, fresh bakery, and frozen products, that includes Goldfish crackers, Snyder’s of Hanover pretzels, Lance sandwich crackers, Cape Cod and Kettle Brand potato chips, Late July snacks, Snack Factory pretzel crisps, and other snacking products. This segment is also involved in the retail business in Latin America. It sells its products through retail food chains, mass discounters and merchandisers, club stores, convenience stores, drug stores, and dollar stores, as well as e-commerce and other retail, commercial, and non-commercial establishments, and independent contractor distributors. The company was formerly known as Campbell Soup Company and changed its name to The Campbell's Company in November 2024. The company was founded in 1869 and is headquartered in Camden, New Jersey.
Key insights and themes extracted from this filing
Net sales decreased by 1% to $2.456 billion compared to $2.485 billion in the prior year, driven by volume/mix declines partially offset by net price realization. This indicates a slight contraction in revenue generation.
Gross profit margin increased by 110 basis points, primarily due to benefits from supply chain productivity improvements and favorable net price realization, partially offset by higher cost inflation and other supply chain costs. This shows improved efficiency in managing costs.
Earnings per share decreased by $0.09 YoY, impacted by restructuring charges, implementation costs, commodity mark-to-market adjustments, accelerated amortization, costs associated with the pending acquisition, and pension actuarial gains. This indicates a decrease in profitability.
The company expects to complete the acquisition of Sovos Brands the week of March 11, 2024, subject to customary closing conditions and the expiration of the HSR Act waiting period. This strategic move indicates a focus on expanding the company's portfolio through acquisitions.
The company repurchased 707 thousand shares at a cost of $29 million during the six-month period ended January 28, 2024, indicating a focus on returning value to shareholders. Approximately $301 million remained available under the September 2021 program.
In the second quarter of 2024, Campbell began implementation of a new initiative to improve the effectiveness of its Snacks direct-store-delivery route-to-market network. The company expects to incur expenses of up to approximately $115 million through 2029.
The company has generated total program-to-date pre-tax savings of $915 million and expects to achieve annual ongoing savings of approximately $1 billion by the end of 2025. This demonstrates progress in improving operational efficiency.
The company announced plans to consolidate its Snacks offices in Charlotte and Norwalk into its headquarters in Camden, New Jersey. This initiative is part of the effort to optimize the organizational structure and reduce costs.
The President and Chief Executive Officer and the Executive Vice President and Chief Financial Officer concluded that the company's disclosure controls and procedures are effective as of January 28, 2024. This indicates sound internal controls and governance.
The company notes that its industry continues to be impacted by commodity cost fluctuations, labor cost inflation, input cost inflation and other global macroeconomic challenges. This highlights the ongoing risk of cost pressures affecting profitability.
The company acknowledges risks related to the completion of the Sovos Brands transaction, including the possibility that the conditions to the completion of the transaction may not be satisfied or that the closing might not occur. The company also acknowledges risks related to long-term financing for the Sovos Brands transaction may not be obtained on favorable terms, or at all.
The company acknowledges the possible disruption to the independent contractor distribution models used by certain of our businesses, including as a result of litigation or regulatory actions affecting their independent contractor classification.
Sales were impacted by volume/mix declines with neutral net price realization in the Meals & Beverages segment. This indicates a potential weakening in competitive positioning in the U.S. retail market.
Snacks sales were flat, but excluding the impact from the divestiture of the Emerald nuts business, sales increased driven by sales of our power brands, which increased 4%. This indicates a strong competitive position for the power brands in the Snacks segment.
The company acknowledges the impact of strong competitive responses to our efforts to leverage brand power with product innovation, promotional programs and new advertising. This highlights the need to continuously innovate and adapt to maintain competitive advantage.
Supply chain productivity improvements contributed to the 110 basis-point increase in gross profit margin. This indicates successful efforts to improve operational efficiency.
Administrative expenses increased 17% YoY, primarily due to higher costs associated with cost savings initiatives. This indicates that while cost savings initiatives are underway, they are currently incurring additional costs.
Capital expenditures in the first six months of 2024 included upgrades of assets across both segments of the business, chip and cracker capacity expansion for our Snacks business, enhancements to our headquarters in Camden, New Jersey and network optimization for our Meals & Beverages business. This indicates a focus on improving operational efficiency and capacity.
The company continues to optimize its information technology infrastructure and applications as part of its cost savings initiatives. This indicates a focus on leveraging technology to improve efficiency and reduce costs.
The capital expenditures primarily relate to implementation of our existing SAP enterprise-resource planning system for Snyder's-Lance. This indicates a focus on integrating technology systems to improve operational efficiency.
The company acknowledges the impact of strong competitive responses to our efforts to leverage brand power with product innovation, promotional programs and new advertising. This highlights the need to continuously innovate and adapt to maintain competitive advantage.
The company intends to finance the pending Sovos Brands acquisition with the issuance of new debt. This indicates a strategic allocation of capital towards acquisitions.
The company repurchased 707 thousand shares at a cost of $29 million during the six-month period ended January 28, 2024, indicating a focus on returning value to shareholders. Approximately $301 million remained available under the September 2021 program.
Capital expenditures in the first six months of 2024 included upgrades of assets across both segments of the business, chip and cracker capacity expansion for our Snacks business, enhancements to our headquarters in Camden, New Jersey and network optimization for our Meals & Beverages business. This indicates a focus on investing in infrastructure to improve efficiency and growth.
The 10-Q filing does not contain specific details or updates on ESG initiatives, environmental commitments, social responsibility programs, or governance practices. This suggests a lack of focus or disclosure on these topics in the current reporting period.
The 10-Q filing does not contain specific details or updates on sustainability risks or opportunities. This suggests a lack of focus or disclosure on these topics in the current reporting period.
The 10-Q filing does not contain specific details or updates on DEI initiatives. This suggests a lack of focus or disclosure on these topics in the current reporting period.
The company notes that its industry continues to be impacted by commodity cost fluctuations, labor cost inflation, input cost inflation and other global macroeconomic challenges. This highlights the ongoing risk of cost pressures affecting profitability.
The company acknowledges changes in consumer demand for our products and favorable perception of our brands. This highlights the need to continuously monitor and adapt to changing consumer preferences.
The company acknowledges a changing customer landscape, with value and e-commerce retailers expanding their market presence. This highlights the need to adapt to evolving retail channels and customer preferences.