Campbell CEO Douglas Conant to step down in July 2011; exec Morrison named as replacement

Campbell CEO Douglas Conant to step down in July

PORTLAND, Ore. — Campbell Soup Co. CEO Douglas Conant is stepping down in July after a decade leading the world’s top soup maker, the company said Tuesday.

Campbell’s president of North American soup, sauces and beverages — Denise Morrison — is expected to succeed him. The company’s board named Morrison, 56, as chief operating officer and appointed her to the board in anticipation of her election as CEO.

Conant, 59, is to depart at the end of the company’s fiscal year on July 31 and work with Morrison until then. He declined to discuss his plans beyond that point.

“I can walk away proud of what we’ve done and excited about the future,” Conant, 59, said. “It’s hard to do, but Denise is so capable I know (the business) will be in good hands.”

Conant had been CEO and president of Campbell since January 2001, when he was brought on to rebuild the company and stabilize sales of its iconic line of condensed soup. Sales have softened recently, however, leaving Morrison with some challenges moving forward.

Sales, earnings and market share rose nearly every year Conant was in charge, and the company’s array of offerings expanded. He also helped position Campbell as a provider of healthy products; the company has cut sodium in soups, breads and other products, added new lines of V-8 juices and sold product lines that didn’t fit the mission, like Godiva Chocolatier.

Conant also kept the company’s base in the impoverished city of Camden, N.J., and opened an expanded headquarters there this summer.

“The legacy of his wide-ranging contributions and sterling personal values will long endure at Campbell,” Chairman Paul Charron said of Conant in a news release.

Conant led the company’s first major foray into the major soup-eating nations of Russia and China.

Analysts are puzzled as to why the soup category has suffered, having thought it would be a hit among budget-minded consumers who are eating at home more often.

Morrison declined to give specifics about her plans for the soup category, but she expressed confidence in the future of Campbell.

“This is the achievement of a lifelong dream,” Morrison said. “I am going to be totally focused on the business…. I have a lot to work with here in terms of great brands and great people.”

Some saw the transition from Conant to Morrison as an orderly shift in top management. Morrison has 35 years of experience in consumer packaged good industry, working for giants such work Kraft Foods Inc., Nestle USA, Procter & Gamble Co. and PepsiCo Inc. before joining Campbell in 2003.

Standard & Poor’s equity analyst Tom Graves called Morrison a reasonable selection to help lead a company that is in a highly competitive and challenging category.

Her selection cements Campbell’s commitment to soup, said Janney Capital Markets analyst Jonathan Feeney, because the board passed up one of its own, William Perez, a former Wrigley CEO who recently joined the board. Perez might have remade Campbell’s portfolio or explored strategic options, Feeney said.

Many were caught by surprise, and some questioned the timing of Conant’s departure.

“I’ve got way more questions than I do answers right now,” said Jack Russo, an analyst with Edward Jones & Co. “Why now?”

Some wondered if Conant’s health is at risk, he was injured in a car crash in 2009 and did not return to Campbell headquarters for about a month.

“I don’t think anybody saw it coming,” Russo said. “Hopefully we’ll get some answers in the coming days.”

Conant said it is simply good succession planning and 10 years was long enough at one company.

“If you measure it in CEO years, it is about 70 years,” he said. “But I’ve loved every minute of it.”

Campbell’s performance has been lackluster recently, which analysts attributed primarily to the tough competition and promotional environment that all food makers are facing. The company reported this month that its full-year net income grew roughly 15 percent to $844 million; on an adjusted basis, it grew 8 percent to $794 million.

The company’s outlook left some investors jittery, however, and it is about to enter the critical soup season, which several analysts say is more important than ever for Campbell.

Shares of Campbell rose 22 cents to close at $36.45 but fell 25 cents in after-hours trading. The company’s stock has traded between $30.96 and $37.59 in the past 52 weeks.

AP writers Emily Fredrix and Geoff Mulvihill contributed to this report.