Campbell Soup Q1 Earnings Fall 3.7 Percent, Cuts Full-Year Outlook

November 24, 2008 4:13 p.m. EST

Camden, NJ (AHN) - Campbell Soup Co. announced Monday fiscal first quarter earnings fell 3.7 percent as losses in commodity hedges more than offset robust soup sales. The company also lowered its earnings outlook due to a strengthening U.S. dollar.

The soup maker posted first quarter earnings of $260 million or 71 cents a share, down from $270 million or 70 cents a share.

Excluding one-time charges for losses on commodity hedges, Campbell earned $281 million or 77 cents a share. The result is slightly better than the 76 cents a share analysts were expecting, according to Thomson Reuters.

Revenue rose to $2.25 billion, up 3 percent from $2.19 billion last year. Sales of condensed soup were particularly strong, up 14 percent in the quarter.

The company also saw strength in its ready-to-serve soup line with sales growing by 7 percent. Soup sales in the U.S. grew by 12 percent as consumers continue to eat in as the economy struggles.

Campbell reduced its fiscal 2009 earnings growth expectation due to the strengthening U.S. dollar. Roughly 25 to 30 percent of the company's sales are done overseas.

The company expects the rising dollar to cut earnings growth by about 5 percent. Earlier estimates were for 5 to 7 percent growth, which would equate to about $2.19 to $2.23 a share. Analysts are looking for earnings of $2.21 a share.