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Apr 26, 2020
Campbell Soup Q3 2020 Earnings Report
Reported a strong third quarter with increased net sales and adjusted EPS, driven by unprecedented demand.
Key Takeaways
Campbell Soup Company reported a 15% increase in net sales and a 57% increase in adjusted EPS in the third quarter of fiscal 2020. The company raised its fiscal 2020 guidance to reflect the improved outlook based on the current operating environment.
Net sales increased 15%, with organic net sales up 17% due to increased demand.
EPS from continuing operations increased 34% to $0.55, while adjusted EPS rose 57% to $0.83.
Campbell's products were purchased by millions of new households, increasing total company household penetration by over 6 percentage points.
Fiscal 2020 guidance raised to reflect improved outlook based on current operating environment.
Campbell Soup
Campbell Soup
Campbell Soup Revenue by Segment
Revenue by Segment
Meals & Beverages Revenue
CapyFin.comSnacks Revenue
CapyFin.com Forward Guidance
Campbell raises fiscal 2020 guidance as a result of our performance in the third quarter, which was significantly impacted by the increase in demand of our products amidst the COVID-19 pandemic, and our current outlook for continued demand for our products.
Positive Outlook
- Net Sales +5.5 to +6.5%
- Adjusted EBIT +12 to +14%
- Adjusted EPS $2.87 to $2.92
- Benefit of the 53rd week, consistent with the prior fiscal 2020 guidance, is estimated to be worth two points of net sales, adjusted EBIT and adjusted EPS.
- The outlook for organic net sales excludes the negative impact from the sale of the European chips business along with the estimated contribution of the 53rd week.
Challenges Ahead
- The effect of the COVID-19 pandemic on our sales, adjusted EBIT and adjusted EPS cannot be predicted with certainty
- Fiscal 2020 comprises 53 weeks, one additional week compared to fiscal 2019.
- Although the effect of the COVID-19 pandemic on our sales, adjusted EBIT and adjusted EPS cannot be predicted with certainty, this revised outlook reflects our current expectation of trends through the balance of the fiscal year.
- Cost Savings Program from Continuing Operations In the third quarter of fiscal 2020, Campbell achieved $30 million in savings under its multi-year cost savings program, inclusive of Snyder’s-Lance synergies, bringing total program-to-date savings to $680 million.
- Year-to-date savings were $120 million through the first nine months of fiscal 2020.
Revenue & Expenses
Visualization of income flow from segment revenue to net income