Campbell Soup cuts fiscal 2010 sales outlook; will improve its condensed soups

Campbell Soup lower fiscal 2010 sales guidance

CAMDEN, N.J. — Campbell Soup Co. lowered its fiscal 2010 sales forecast Wednesday and said it will improve some of its soups by cutting sodium further and changing their packaging.

The world’s biggest soup maker now anticipates full-year sales will rise 2.5 percent to 3.5 percent, down from its prior outlook for a 4 percent to 5 percent increase.

Based on 2009 revenue of $7.6 billion, that implies sales of about $7.79 billion to $7.87 billion. Analysts polled by Thomson Reuters expect 2010 revenue of $7.87 billion.

Campbell, based in Camden, N.J., also maintained its outlook for 2010 adjusted earnings per share to climb 9 percent to 11 percent from fiscal 2009’s $2.21 per share. This would put 2010 profit between approximately $2.41 and $2.45 per share.

Analysts predict earnings of $2.46 per share for the year. These estimates typically remove one-time items.

In addition, Campbell announced it will tweak more than 60 percent of its condensed soups, reducing sodium in 23 of them by up to 45 percent. Once complete, nearly half of Campbell’s condensed soups will have sodium levels at 480 milligrams or less per serving, considered healthy by the U.S. government.

Campbell has cut the sodium level in more than 100 of its products — including V8 juices, Prego sauces, Pepperidge Farm breads and its namesake soups — by 25 percent to 50 percent over the past four years.

The soup maker will also change the cans’ labeling by using new photographs to play up the soups’ appearance. While the cans’ iconic red and white coloring will remain, a more contemporary design will be used on various condensed soups. Those not receiving packaging updates include chicken noodle, cream of mushroom and tomato soups.

The moves are part of the company’s effort to maintain its dominant position in the soup market, which includes rivals like General Mills Inc.’s Progresso and ConAgra Foods Inc.’s Healthy Choice. Campbell’s soup business brought in more than $1 billion in revenue in fiscal 2009, as attractive pricing and brand loyalty kept recession-weary customers in search of fast meals coming back for more.

President and CEO Douglas Conant said in a statement that the company plans to get more aggressive on the positioning of its ready-to-serve products. To that end, Campbell plans to roll out a new advertising campaign that show consumers how soup and dishes made with soup can be a “simple meal.” Consumers have gravitated toward easy-to-make, inexpensive products such as cereal during the economic downturn.

The changes will appear in stores in August.