Campbell Soup Company (NYSE: CPB) surpassed analysts’ expectations on revenue and earnings for the third quarter of 2019, allowing shares to climb 4.3% in premarket hours on Wednesday. The consensus estimate was for earnings of $0.47 per share on revenue of $2.36 billion.
On a combined basis, net sales grew 12% from the prior-year period to $2.38 billion. Net sales from continuing operations rose 16% to $2.18 billion. Net sales from discontinued operations were down 15% to $210 million.
On a GAAP basis, the company reported net income of $84 million, or $0.28 per share, compared to a net loss of $393 million, or $1.31 per share, in the prior-year quarter. Adjusted EPS fell 20% to $0.56.
In the Meals and Beverages segment, sales fell 1% year-over-year to $1.02 billion. In Global Biscuits and Snacks, sales grew 37% to $1.15 billion, and organic sales rose 1%, helped by growth in Pepperidge Farm.
During the quarter, Campbell completed the divestitures of its US refrigerated soup and Garden Fresh Gourmet businesses and in April, the company signed an agreement to sell its Bolthouse Farms business to an affiliate of Butterfly Equity for $510 million. As a result of these transactions, the Campbell Fresh division is now reported as discontinued operations.
Campbell revised its guidance for fiscal-year 2019 to reflect the impact of the divestitures and now expects net sales to come in the range of $9.07 billion to $9.12 billion versus the prior range of $9.97 billion to $10.1 billion. Adjusted EPS is expected to be $2.50-2.55 compared to the previous outlook of $2.45-2.53.
During the quarter, Campbell achieved $55 million in savings under its multi-year cost savings program, inclusive of Snyder’s-Lance synergies, bringing total program-to-date savings to $605 million. For continuing operations, the company is targeting cumulative annualized savings of $850 million by the end of fiscal 2022, of which $535 million has been achieved program-to-date.
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