CORRECTING and REPLACING Campbell Reports Fourth-Quarter Fiscal 2024 Results; Provides Full-Year Fiscal 2025 Guidance
The updated release reads:
CAMPBELL REPORTS FOURTH-QUARTER FISCAL 2024 RESULTS; PROVIDES FULL-YEAR FISCAL 2025 GUIDANCE
For the fourth quarter:
-
Net Sales increased 11% to$2.3 billion and decreased 1% on an organic basis. -
Earnings Before Interest and Taxes (EBIT) decreased to
$77 million . Adjusted EBIT increased 36% to$329 million including the impact of theSovos Brands, Inc. (Sovos Brands ) acquisition. -
Earnings Per Share (EPS) decreased to
$(0.01) . Adjusted EPS increased 26% to$0.63 .
For the full year:
-
Net Sales increased 3% to$9.6 billion and decreased 1% on an organic basis. -
EBIT decreased to
$1 billion . Adjusted EBIT increased 6% to$1.5 billion including the impact of theSovos Brands acquisition. -
EPS decreased to
$1.89 . Adjusted EPS increased 3% to$3.08 . -
Returned
$512 million to shareholders including$445 million in dividends. -
Fiscal 2025 Investor Day to be held on
September 10, 2024 at Nasdaq MarketSite.
CEO Comments
“We finished fiscal 2024 with solid fourth-quarter performance including sequential volume improvement and margin expansion versus prior year and delivered significant progress against our longer-term strategic plan despite an evolving consumer landscape,” said Campbell’s President and CEO,
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Three Months Ended |
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Twelve Months Ended |
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($ in millions, except per share) |
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% Change |
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% Change |
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As Reported (GAAP) |
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11% |
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3% |
Organic |
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(1)% |
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(1)% |
Earnings Before Interest and Taxes (EBIT) |
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As Reported (GAAP) |
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(72)% |
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(24)% |
Adjusted |
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36% |
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6% |
Diluted Earnings Per Share |
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As Reported (GAAP) |
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n/m |
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(34)% |
Adjusted |
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26% |
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3% |
n/m - not meaningful |
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Note: A detailed reconciliation of the reported (GAAP) financial information to the adjusted financial information is included at the end of this news release. |
Items Impacting Comparability
The table below presents a summary of items impacting comparability in each period. A detailed reconciliation of the reported (GAAP) financial information to the adjusted information is included at the end of this news release.
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Diluted Earnings Per Share |
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Three Months Ended |
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Twelve Months Ended |
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As Reported (GAAP) |
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Costs associated with cost savings and optimization initiatives |
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Costs associated with acquisition |
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Commodity mark-to-market losses (gains) |
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Accelerated amortization |
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Pension and postretirement actuarial losses (gains) |
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Impairment charges |
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$— |
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$— |
Certain litigation expenses |
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$— |
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$— |
Cybersecurity incident costs |
$— |
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$— |
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$— |
Charges associated with divestiture |
$— |
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$— |
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Adjusted* |
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*Numbers may not add due to rounding. |
Fourth-Quarter Results
Net sales in the quarter increased 11% to
Gross profit increased to
Marketing and selling expenses, which represented approximately 8% of net sales, decreased 6% to
Administrative expenses increased 9% to
Other expenses were
As reported EBIT decreased to
Net interest expense was
As reported EPS were a loss of
Full-Year 2024 Results
Net sales increased 3% to
As reported EBIT decreased 24% to
Net interest expense increased 32% to
As reported EPS decreased to
Cash flow from operations was
Cost Savings Program from Continuing Operations
Through the fourth quarter, Campbell has delivered
Additionally, post-closing, the company achieved
Full-Year Fiscal 2025 Guidance:
Campbell's full-year fiscal 2025 guidance reflects a balance between sequential progress and pragmatism as the company continues to navigate the on-going consumer recovery. The upper end of the range anticipates a quicker normalization of the consumer environment while the lower end of the range assumes a slower, more conservative pace of recovery.
The recent Pop Secretbusiness divestiture closed on
Guidance reflects the following underlying assumptions:
-
Fiscal 2025 comprises 53 weeks, one additional week compared to fiscal 2024. The benefit of the 53rd week is included in the fiscal 2025 guidance below and is estimated to be worth approximately 2 points of growth to reported net sales and adjusted EBIT, along with
$0.06 of adjusted EPS. -
Net sales growth of 9% to 11% reflecting a full twelve-month contribution from
Sovos Brands and the loss of eleven months of net sales from the divestiture of Pop Secret. - Organic net sales flat to up 2% reflecting modestly positive volume/mix compared to fiscal 2024.
-
Adjusted EBIT growth of 9% to 11%, including the contribution from the acquisition, the impact of the divestiture of Pop Secret and reflecting the following:
-
Inflation in the low-single digit range, with continued mitigation through a variety of levers including productivity improvements of approximately 3% and cost savings initiatives of approximately
$70 million , inclusive of cost synergies related to the integration ofSovos Brands .
-
Inflation in the low-single digit range, with continued mitigation through a variety of levers including productivity improvements of approximately 3% and cost savings initiatives of approximately
- A continued commitment to brand investments, with marketing and selling expenses as a percent of net sales expected to return into the targeted range of 9-10%, including an increase in the first quarter of fiscal 2025.
-
Total company adjusted EBIT margin comparable to fiscal 2024. Snacks operating margin is expected to reflect modest growth inclusive of the near-term margin impact of the Pop Secret divestiture. Meals & Beverages operating margin is expected to be modestly lower reflecting the mix impact of
Sovos Brands , partially offset by a modest margin improvement in the base business. -
Adjusted EPS growth of 1% to 4% with
Sovos Brands expected to be approximately neutral and including the impact of the Pop Secret divestiture. -
Adjusted net interest expense expected to be between
$350 million and$355 million .-
Net interest expense is expected to be higher than fiscal 2024 reflecting a full year of incremental debt related to the
Sovos Brands acquisition and higher expected interest expense associated with the anticipated refinancing of the company’sMarch 2025 bond maturities, with expected debt issuance timing driven by market conditions.
-
Net interest expense is expected to be higher than fiscal 2024 reflecting a full year of incremental debt related to the
Other additional guidance assumptions can be found in the accompanying investor presentation available at investor.campbellsoupcompany.com/events-and-presentations.
The full-year fiscal 2025 guidance is set forth in the table below:
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FY2024 Results |
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FY2025 Guidance |
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($ in millions, except per share) |
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+9% to +11% |
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Organic |
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0% to 2% |
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Adjusted EBIT |
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* |
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+9% to +11% |
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Adjusted EPS |
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* |
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+1% to +4% |
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* Adjusted - refer to the detailed reconciliation of the reported (GAAP) financial information to the adjusted financial information at the end of this news release. |
1 Growth rate adjusted for |
Note: A non-GAAP reconciliation is not provided for fiscal 2025 guidance as the company is unable to reasonably estimate the full-year financial impact of items such as actuarial gains or losses on pension and postretirement plans because these impacts are dependent on future changes in market conditions. The inability to predict the amount and timing of these future items makes a detailed reconciliation of these forward-looking financial measures impracticable. |
Segment Operating Review
An analysis of net sales and operating earnings by reportable segment follows:
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Three Months Ended |
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($ in millions) |
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Meals & Beverages |
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Snacks* |
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Total |
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Volume/Mix |
2% |
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—% |
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1% |
Net Price Realization |
(1)% |
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(2)% |
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(2)% |
Organic |
1% |
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(3)% |
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(1)% |
Currency |
—% |
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—% |
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—% |
Acquisition / (Divestiture)1 |
27% |
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—% |
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12% |
% Change vs. Prior Year |
28% |
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(3)% |
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11% |
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Segment Operating Earnings |
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% Change vs. Prior Year |
60% |
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1% |
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*Numbers may not add due to rounding. |
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1 Reflects the incremental net sales associated with the |
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Note: A detailed reconciliation of the reported (GAAP) net sales to organic net sales is included at the end of this news release. |
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Twelve Months Ended |
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($ in millions) |
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Meals & Beverages* |
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Snacks |
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Total |
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Volume/Mix |
(2)% |
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(2)% |
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(2)% |
Net Price Realization |
—% |
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1% |
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1% |
Organic |
(1)% |
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(1)% |
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(1)% |
Currency |
—% |
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—% |
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—% |
Acquisition / (Divestiture)1 |
9% |
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(1)% |
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4% |
% Change vs. Prior Year |
7% |
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(2)% |
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3% |
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Segment Operating Earnings |
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% Change vs. Prior Year |
9% |
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1% |
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*Numbers may not add due to rounding. |
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1 Reflects the incremental net sales associated with the |
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Note: A detailed reconciliation of the reported (GAAP) net sales to organic net sales is included at the end of this news release. |
Meals & Beverages
Net sales in the quarter increased 28% driven by the benefit of the
Operating earnings in the quarter increased 60% primarily driven by the contribution of the acquisition and higher gross profit in the base business. Gross profit margin increased due to lower other supply chain costs, supply chain productivity improvements and favorable mix, partially offset by moderate inflation, the impact of the recent acquisition and planned unfavorable net price realization.
Snacks
Net sales, both reported and organic, decreased 3% in the quarter. Volume / mix was flat with approximately 1% growth in power brands and a 1% reduction in partner and contract brands. In addition, there was slightly more than a 2% unfavorable net price realization of which approximately half was a planned net pricing investment and the balance reflecting the lapping of favorable trade phasing in the fourth quarter of fiscal 2023.
Operating earnings in the quarter increased 1% primarily due to lower marketing and selling expenses, partially offset by lower gross profit. Gross profit margin decreased due to higher other supply chain costs and lower net price realization, partially offset by supply chain productivity improvements.
Corporate
Corporate expense was
Conference Call and Webcast
Campbell will host a conference call to discuss these results today at
Reportable Segments
Meals & Beverages, which consists of our soup, simple meals and beverage products in retail and foodservice in
Snacks, which consists of
About Campbell
For more than 150 years, Campbell (Nasdaq:CPB) has been connecting people through food they love. Generations of consumers have trusted us to provide delicious and affordable food and beverages. Headquartered in
Forward-Looking Statements
This release contains “forward-looking statements” that reflect the company’s current expectations about the impact of its future plans and performance on the company’s business or financial results. These forward-looking statements, including any statements made regarding sales, EBIT and EPS guidance, rely on a number of assumptions and estimates that could be inaccurate, and which are subject to risks and uncertainties. The factors that could cause the company’s actual results to vary materially from those anticipated or expressed in any forward-looking statement include: the risk that the cost savings and any other synergies from the
CONSOLIDATED STATEMENTS OF EARNINGS (unaudited) (millions, except per share amounts) |
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Three Months Ended |
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Net sales |
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$ |
2,293 |
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$ |
2,068 |
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Costs and expenses |
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|
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Cost of products sold |
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|
1,618 |
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|
|
1,412 |
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Marketing and selling expenses |
|
|
188 |
|
|
|
199 |
|
Administrative expenses |
|
|
182 |
|
|
|
167 |
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Research and development expenses |
|
|
26 |
|
|
|
26 |
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Other expenses / (income) |
|
|
181 |
|
|
|
(9 |
) |
Restructuring charges |
|
|
21 |
|
|
|
1 |
|
Total costs and expenses |
|
|
2,216 |
|
|
|
1,796 |
|
Earnings before interest and taxes |
|
|
77 |
|
|
|
272 |
|
Interest, net |
|
|
83 |
|
|
|
47 |
|
Earnings (loss) before taxes |
|
|
(6 |
) |
|
|
225 |
|
Taxes on earnings |
|
|
(3 |
) |
|
|
56 |
|
Net earnings (loss) |
|
|
(3 |
) |
|
|
169 |
|
Net loss attributable to noncontrolling interests |
|
|
— |
|
|
|
— |
|
Net earnings (loss) attributable to |
|
$ |
(3 |
) |
|
$ |
169 |
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Per share - basic |
|
|
|
|
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Net earnings (loss) attributable to |
|
$ |
(.01 |
) |
|
$ |
.57 |
|
Weighted average shares outstanding - basic |
|
|
298 |
|
|
|
298 |
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Per share - assuming dilution |
|
|
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|
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Net earnings attributable to |
|
$ |
(.01 |
) |
|
$ |
.57 |
|
Weighted average shares outstanding - assuming dilution |
|
|
298 |
|
|
|
299 |
|
CONSOLIDATED STATEMENTS OF EARNINGS (millions, except per share amounts) |
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Twelve Months Ended |
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Net sales |
|
$ |
9,636 |
|
$ |
9,357 |
Costs and expenses |
|
|
|
|
||
Cost of products sold |
|
|
6,665 |
|
|
6,440 |
Marketing and selling expenses |
|
|
833 |
|
|
811 |
Administrative expenses |
|
|
737 |
|
|
654 |
Research and development expenses |
|
|
102 |
|
|
92 |
Other expenses / (income) |
|
|
261 |
|
|
32 |
Restructuring charges |
|
|
38 |
|
|
16 |
Total costs and expenses |
|
|
8,636 |
|
|
8,045 |
Earnings before interest and taxes |
|
|
1,000 |
|
|
1,312 |
Interest, net |
|
|
243 |
|
|
184 |
Earnings before taxes |
|
|
757 |
|
|
1,128 |
Taxes on earnings |
|
|
190 |
|
|
270 |
Net earnings |
|
|
567 |
|
|
858 |
Net loss attributable to noncontrolling interests |
|
|
— |
|
|
— |
Net earnings attributable to |
|
$ |
567 |
|
$ |
858 |
Per share - basic |
|
|
|
|
||
Net earnings attributable to |
|
$ |
1.90 |
|
$ |
2.87 |
Weighted average shares outstanding - basic |
|
|
298 |
|
|
299 |
Per share - assuming dilution |
|
|
|
|
||
Net earnings attributable to |
|
$ |
1.89 |
|
$ |
2.85 |
Weighted average shares outstanding - assuming dilution |
|
|
300 |
|
|
301 |
CONSOLIDATED SUPPLEMENTAL SCHEDULE OF SALES AND EARNINGS (unaudited) (millions, except per share amounts) |
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Three Months Ended |
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Percent Change |
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Sales |
|
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Contributions: |
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|
|
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Meals & Beverages |
$ |
1,200 |
|
|
$ |
936 |
|
|
28% |
Snacks |
|
1,093 |
|
|
|
1,132 |
|
|
(3)% |
Total sales |
$ |
2,293 |
|
|
$ |
2,068 |
|
|
11% |
Earnings |
|
|
|
|
|
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Contributions: |
|
|
|
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|
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Meals & Beverages |
$ |
211 |
|
|
$ |
132 |
|
|
60% |
Snacks |
|
159 |
|
|
|
158 |
|
|
1% |
Total operating earnings |
|
370 |
|
|
|
290 |
|
|
28% |
Corporate income (expense) |
|
(272 |
) |
|
|
(17 |
) |
|
|
Restructuring charges |
|
(21 |
) |
|
|
(1 |
) |
|
|
Earnings before interest and taxes |
|
77 |
|
|
|
272 |
|
|
(72)% |
Interest, net |
|
83 |
|
|
|
47 |
|
|
|
Taxes on earnings |
|
(3 |
) |
|
|
56 |
|
|
|
Net earnings (loss) |
|
(3 |
) |
|
|
169 |
|
|
n/m |
Net loss attributable to noncontrolling interests |
|
— |
|
|
|
— |
|
|
|
Net earnings (loss) attributable to |
$ |
(3 |
) |
|
$ |
169 |
|
|
n/m |
Per share - assuming dilution |
|
|
|
|
|
||||
Net earnings attributable to |
$ |
(.01 |
) |
|
$ |
.57 |
|
|
n/m |
n/m - not meaningful |
CONSOLIDATED SUPPLEMENTAL SCHEDULE OF SALES AND EARNINGS (millions, except per share amounts) |
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|
Twelve Months Ended |
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|
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|
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Percent Change |
||||
Sales |
|
|
|
|
|
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Contributions: |
|
|
|
|
|
||||
Meals & Beverages |
$ |
5,258 |
|
|
$ |
4,907 |
|
|
7% |
Snacks |
|
4,378 |
|
|
|
4,450 |
|
|
(2)% |
Total sales |
$ |
9,636 |
|
|
$ |
9,357 |
|
|
3% |
Earnings |
|
|
|
|
|
||||
Contributions: |
|
|
|
|
|
||||
Meals & Beverages |
$ |
974 |
|
|
$ |
894 |
|
|
9% |
Snacks |
|
648 |
|
|
|
640 |
|
|
1% |
Total operating earnings |
|
1,622 |
|
|
|
1,534 |
|
|
6% |
Corporate income (expense) |
|
(584 |
) |
|
|
(206 |
) |
|
|
Restructuring charges |
|
(38 |
) |
|
|
(16 |
) |
|
|
Earnings before interest and taxes |
|
1,000 |
|
|
|
1,312 |
|
|
(24)% |
Interest, net |
|
243 |
|
|
|
184 |
|
|
|
Taxes on earnings |
|
190 |
|
|
|
270 |
|
|
|
Net earnings |
|
567 |
|
|
|
858 |
|
|
(34)% |
Net loss attributable to noncontrolling interests |
|
— |
|
|
|
— |
|
|
|
Net earnings attributable to |
$ |
567 |
|
|
$ |
858 |
|
|
(34)% |
Per share - assuming dilution |
|
|
|
|
|
||||
Net earnings attributable to |
$ |
1.89 |
|
|
$ |
2.85 |
|
|
(34)% |
CONDENSED CONSOLIDATED BALANCE SHEETS (millions) |
|||||
|
|
|
|
||
Current assets |
$ |
2,190 |
|
$ |
2,061 |
Plant assets, net |
|
2,698 |
|
|
2,398 |
Intangible assets, net |
|
9,793 |
|
|
7,107 |
Other assets |
|
554 |
|
|
492 |
Total assets |
$ |
15,235 |
|
$ |
12,058 |
Current liabilities |
$ |
3,576 |
|
$ |
2,222 |
Long-term debt |
|
5,761 |
|
|
4,498 |
Other liabilities |
|
2,102 |
|
|
1,675 |
Total equity |
|
3,796 |
|
|
3,663 |
Total liabilities and equity |
$ |
15,235 |
|
$ |
12,058 |
Total debt |
$ |
7,184 |
|
$ |
4,689 |
Total cash and cash equivalents |
$ |
108 |
|
$ |
189 |
CONSOLIDATED STATEMENTS OF CASH FLOWS (millions) |
|||||||
|
Twelve Months Ended |
||||||
|
|
|
|
||||
Cash flows from operating activities: |
|
|
|
||||
Net earnings |
$ |
567 |
|
|
$ |
858 |
|
Adjustments to reconcile net earnings to operating cash flow |
|
|
|
||||
Impairment charges |
|
129 |
|
|
|
— |
|
Restructuring charges |
|
38 |
|
|
|
16 |
|
Stock-based compensation |
|
99 |
|
|
|
63 |
|
Amortization of inventory fair value adjustment from acquisition |
|
17 |
|
|
|
— |
|
Pension and postretirement benefit expense (income) |
|
39 |
|
|
|
(22 |
) |
Depreciation and amortization |
|
411 |
|
|
|
387 |
|
Deferred income taxes |
|
(47 |
) |
|
|
(5 |
) |
Net loss on sale of business |
|
— |
|
|
|
13 |
|
Other |
|
138 |
|
|
|
100 |
|
Changes in working capital, net of acquisition and divestiture |
|
|
|
||||
Accounts receivable |
|
(16 |
) |
|
|
(1 |
) |
Inventories |
|
11 |
|
|
|
(64 |
) |
Other current assets |
|
4 |
|
|
|
13 |
|
Accounts payable and accrued liabilities |
|
(128 |
) |
|
|
(164 |
) |
Other |
|
(77 |
) |
|
|
(51 |
) |
Net cash provided by operating activities |
|
1,185 |
|
|
|
1,143 |
|
Cash flows from investing activities: |
|
|
|
||||
Purchases of plant assets |
|
(517 |
) |
|
|
(370 |
) |
Purchases of route businesses |
|
(29 |
) |
|
|
(13 |
) |
Sales of route businesses |
|
34 |
|
|
|
1 |
|
Business acquired, net of cash acquired |
|
(2,617 |
) |
|
|
— |
|
Sale of business |
|
— |
|
|
|
41 |
|
Other |
|
1 |
|
|
|
1 |
|
Net cash used in investing activities |
|
(3,128 |
) |
|
|
(340 |
) |
Cash flows from financing activities: |
|
|
|
||||
Short-term borrowings, including commercial paper and delayed draw term loan |
|
5,622 |
|
|
|
3,677 |
|
Short-term repayments, including commercial paper and delayed draw term loan |
|
(5,576 |
) |
|
|
(3,749 |
) |
Long-term borrowings |
|
2,496 |
|
|
|
500 |
|
Long-term repayments |
|
(100 |
) |
|
|
(566 |
) |
Dividends paid |
|
(445 |
) |
|
|
(447 |
) |
|
|
(67 |
) |
|
|
(142 |
) |
|
|
2 |
|
|
|
22 |
|
Payments related to tax withholding for stock-based compensation |
|
(46 |
) |
|
|
(19 |
) |
Payments of debt issuance costs |
|
(23 |
) |
|
|
— |
|
Other |
|
— |
|
|
|
1 |
|
Net cash provided by (used in) financing activities |
|
1,863 |
|
|
|
(723 |
) |
Effect of exchange rate changes on cash |
|
(1 |
) |
|
|
— |
|
Net change in cash and cash equivalents |
|
(81 |
) |
|
|
80 |
|
Cash and cash equivalents — beginning of period |
|
189 |
|
|
|
109 |
|
Cash and cash equivalents — end of period |
$ |
108 |
|
|
$ |
189 |
|
Reconciliation of GAAP to Non-GAAP Financial Measures
Fiscal Year Ended
Organic
Organic net sales are net sales excluding the impact of currency, acquisitions and divestitures. Management believes that excluding these items, which are not part of the ongoing business, improves the comparability of year-to-year results. A reconciliation of net sales as reported to organic net sales follows.
Three Months Ended |
||||||||||||||||||||||||||||
|
|
|
|
|
% Change |
|||||||||||||||||||||||
(millions) |
as Reported |
Impact of Currency |
Impact of Acquisition |
Organic |
|
as Reported |
Impact of Divestiture |
Organic |
|
as Reported |
Organic |
|||||||||||||||||
Meals & Beverages |
$ |
1,200 |
$ |
2 |
$ |
(257 |
) |
$ |
945 |
|
$ |
936 |
$ |
— |
|
$ |
936 |
|
28 |
% |
1 |
% |
||||||
Snacks |
|
1,093 |
|
— |
|
— |
|
|
1,093 |
|
|
1,132 |
|
(5 |
) |
|
1,127 |
|
(3 |
)% |
(3 |
)% |
||||||
Total |
$ |
2,293 |
$ |
2 |
$ |
(257 |
) |
$ |
2,038 |
|
$ |
2,068 |
$ |
(5 |
) |
$ |
2,063 |
|
11 |
% |
(1 |
)% |
Twelve Months Ended |
|||||||||||||||||||||||||||||
|
|
|
|
|
% Change |
||||||||||||||||||||||||
(millions) |
as Reported |
Impact of Currency |
Impact of Acquisition |
Organic |
|
as Reported |
Impact of Divestiture |
Organic |
|
as Reported |
Organic |
||||||||||||||||||
Meals & Beverages |
$ |
5,258 |
$ |
5 |
|
$ |
(423 |
) |
$ |
4,840 |
|
$ |
4,907 |
$ |
— |
|
$ |
4,907 |
|
7 |
% |
(1 |
)% |
||||||
Snacks |
|
4,378 |
|
(2 |
) |
|
— |
|
|
4,376 |
|
|
4,450 |
|
(51 |
) |
|
4,399 |
|
(2 |
)% |
(1 |
)% |
||||||
Total |
$ |
9,636 |
$ |
3 |
|
$ |
(423 |
) |
$ |
9,216 |
|
$ |
9,357 |
$ |
(51 |
) |
$ |
9,306 |
|
3 |
% |
(1 |
)% |
Twelve Months Ended |
|||||||||
|
|
||||||||
(millions) |
as Reported |
Impact of Divestiture |
Organic FY 2025 Guidance |
||||||
Meals & Beverages |
$ |
5,258 |
$ |
— |
|
$ |
5,258 |
||
Snacks |
|
4,378 |
|
(111 |
) |
|
4,267 |
||
Total |
$ |
9,636 |
$ |
(111 |
) |
$ |
9,525 |
Items Impacting Earnings
Adjusted Net earnings are net earnings excluding the impact of costs associated with cost savings and optimization initiatives, costs associated with acquisitions, unrealized mark-to-market gains or losses on outstanding undesignated commodity hedges, accelerated amortization, actuarial gains or losses on pension and postretirement plans, impairment charges, certain litigation expenses, costs related to a cybersecurity incident, and gains or losses on divestitures. Management believes that financial information excluding certain items that are not considered to reflect the ongoing operating results, such as those listed below, improves the comparability of year-to-year results. Consequently, management believes that investors may be able to better understand its results excluding these items.
The following items impacted earnings:
(1) |
The company has implemented several cost savings initiatives in recent years. In the fourth quarter of fiscal 2024, the company recorded Restructuring charges of |
|
In the second quarter of fiscal 2024, the company began implementation of a new optimization initiative to improve the effectiveness of its Snacks direct-store-delivery route-to-market network. In fiscal 2024, the company recognized |
|
In the fourth quarter of fiscal 2024, the total aggregate impact related to the cost savings and optimization initiatives was |
(2) |
In the first quarter of fiscal 2024, the company announced its intent to acquire |
(3) |
In the fourth quarter of fiscal 2024, the company recognized losses in Cost of products sold of |
(4) |
In the fourth quarter of fiscal 2024, the company recorded accelerated amortization expense in Other expenses / (income) of |
(5) |
In the fourth quarter of fiscal 2024, the company recognized actuarial losses on pension and postretirement plans in Other expenses / (income) of |
(6) |
In the fourth quarter of fiscal 2024, the company recognized an impairment charge of |
|
In the fourth quarter of fiscal 2024, the company performed an impairment assessment on the assets in the Pop Secret business within the Snacks segment as sales and operating performance were below expectations due in part to competitive pressure and reduced margins, and as the company pursued divesting the business. As a result of these factors, in the fourth quarter of fiscal 2024, the company lowered the long-term outlook for the business and recognized an impairment charge of |
|
The total aggregate impact of the impairment charges was |
(7) |
In the fourth quarter of fiscal 2024, the company recorded pre- and after-tax litigation expenses in Administrative expenses of |
(8) |
In fiscal 2024, the company recorded costs of |
(9) |
In the fourth quarter of fiscal 2023, the company recorded a pre- and after-tax loss in Other expenses / (income) of |
The following tables reconcile financial information, presented in accordance with GAAP, to financial information excluding certain items:
|
|
Three Months Ended |
|
|
|
Twelve Months Ended |
|
|
||||||||||||
(millions, except per share amounts) |
|
|
|
|
|
Percent Change |
|
|
|
|
|
Percent Change |
||||||||
Gross profit, as reported |
|
$ |
675 |
|
|
$ |
656 |
|
|
3% |
|
$ |
2,971 |
|
|
$ |
2,917 |
|
|
2% |
Gross profit margin, as reported |
|
|
29.4 |
% |
|
|
31.7 |
% |
|
(230) pts |
|
|
30.8 |
% |
|
|
31.2 |
% |
|
(40) pts |
Costs associated with cost savings and optimization initiatives (1) |
|
|
17 |
|
|
|
6 |
|
|
|
|
|
26 |
|
|
|
18 |
|
|
|
Costs associated with acquisition (2) |
|
|
— |
|
|
|
— |
|
|
|
|
|
18 |
|
|
|
— |
|
|
|
Commodity mark-to-market losses (gains) (3) |
|
|
27 |
|
|
|
(30 |
) |
|
|
|
|
22 |
|
|
|
(21 |
) |
|
|
Cybersecurity incident costs (8) |
|
|
— |
|
|
|
— |
|
|
|
|
|
2 |
|
|
|
— |
|
|
|
Adjusted Gross profit |
|
$ |
719 |
|
|
$ |
632 |
|
|
14% |
|
$ |
3,039 |
|
|
$ |
2,914 |
|
|
4% |
Adjusted Gross profit margin |
|
|
31.4 |
% |
|
|
30.6 |
% |
|
80 pts |
|
|
31.5 |
% |
|
|
31.1 |
% |
|
40 pts |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Marketing and selling expenses, as reported |
|
$ |
188 |
|
|
$ |
199 |
|
|
(6)% |
|
$ |
833 |
|
|
$ |
811 |
|
|
3% |
Costs associated with cost savings and optimization initiatives (1) |
|
|
— |
|
|
|
(5 |
) |
|
|
|
|
(9 |
) |
|
|
(5 |
) |
|
|
Costs associated with acquisition (2) |
|
|
(1 |
) |
|
|
— |
|
|
|
|
|
(3 |
) |
|
|
— |
|
|
|
Adjusted Marketing and selling expenses |
|
$ |
187 |
|
|
$ |
194 |
|
|
(4)% |
|
$ |
821 |
|
|
$ |
806 |
|
|
2% |
Administrative expenses, as reported |
|
$ |
182 |
|
|
$ |
167 |
|
|
9% |
|
$ |
737 |
|
|
$ |
654 |
|
|
13% |
Costs associated with cost savings and optimization initiatives (1) |
|
|
(7 |
) |
|
|
(3 |
) |
|
|
|
|
(54 |
) |
|
|
(24 |
) |
|
|
Costs associated with acquisition (2) |
|
|
(8 |
) |
|
|
— |
|
|
|
|
|
(47 |
) |
|
|
— |
|
|
|
Certain litigation expenses (7) |
|
|
(2 |
) |
|
|
— |
|
|
|
|
|
(5 |
) |
|
|
— |
|
|
|
Cybersecurity incident costs (8) |
|
|
— |
|
|
|
— |
|
|
|
|
|
(1 |
) |
|
|
— |
|
|
|
Adjusted Administrative expenses |
|
$ |
165 |
|
|
$ |
164 |
|
|
1% |
|
$ |
630 |
|
|
$ |
630 |
|
|
—% |
Research and development expenses, as reported |
|
$ |
26 |
|
|
$ |
26 |
|
|
|
|
$ |
102 |
|
|
$ |
92 |
|
|
|
Costs associated with cost savings and optimization initiatives (1) |
|
|
— |
|
|
|
(1 |
) |
|
|
|
|
(3 |
) |
|
|
(3 |
) |
|
|
Costs associated with acquisition (2) |
|
|
— |
|
|
|
— |
|
|
|
|
|
(2 |
) |
|
|
— |
|
|
|
|
|
$ |
26 |
|
|
$ |
25 |
|
|
|
|
$ |
97 |
|
|
$ |
89 |
|
|
|
Other expenses / (income), as reported |
|
$ |
181 |
|
|
$ |
(9 |
) |
|
|
|
$ |
261 |
|
|
$ |
32 |
|
|
|
Costs associated with acquisition (2) |
|
|
— |
|
|
|
(5 |
) |
|
|
|
|
(35 |
) |
|
|
(5 |
) |
|
|
Accelerated amortization (4) |
|
|
(7 |
) |
|
|
(7 |
) |
|
|
|
|
(27 |
) |
|
|
(7 |
) |
|
|
Pension and postretirement actuarial gains (losses) (5) |
|
|
(33 |
) |
|
|
41 |
|
|
|
|
|
(33 |
) |
|
|
15 |
|
|
|
Impairment charges (6) |
|
|
(129 |
) |
|
|
— |
|
|
|
|
|
(129 |
) |
|
|
— |
|
|
|
Charges associated with divestiture (9) |
|
|
— |
|
|
|
(13 |
) |
|
|
|
|
— |
|
|
|
(13 |
) |
|
|
Adjusted Other expenses / (income) |
|
$ |
12 |
|
|
$ |
7 |
|
|
|
|
$ |
37 |
|
|
$ |
22 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings before interest and taxes, as reported |
|
$ |
77 |
|
|
$ |
272 |
|
|
(72)% |
|
$ |
1,000 |
|
|
$ |
1,312 |
|
|
(24)% |
Costs associated with cost savings and optimization initiatives (1) |
|
|
40 |
|
|
|
16 |
|
|
|
|
|
109 |
|
|
|
66 |
|
|
|
Costs associated with acquisition (2) |
|
|
14 |
|
|
|
5 |
|
|
|
|
|
126 |
|
|
|
5 |
|
|
|
Commodity mark-to-market losses (gains) (3) |
|
|
27 |
|
|
|
(30 |
) |
|
|
|
|
22 |
|
|
|
(21 |
) |
|
|
Accelerated amortization (4) |
|
|
7 |
|
|
|
7 |
|
|
|
|
|
27 |
|
|
|
7 |
|
|
|
Pension and postretirement actuarial losses (gains) (5) |
|
|
33 |
|
|
|
(41 |
) |
|
|
|
|
33 |
|
|
|
(15 |
) |
|
|
Impairment charges (6) |
|
|
129 |
|
|
|
— |
|
|
|
|
|
129 |
|
|
|
— |
|
|
|
Certain litigation expenses (7) |
|
|
2 |
|
|
|
— |
|
|
|
|
|
5 |
|
|
|
— |
|
|
|
Cybersecurity incident costs (8) |
|
|
— |
|
|
|
— |
|
|
|
|
|
3 |
|
|
|
— |
|
|
|
Charges associated with divestiture (9) |
|
|
— |
|
|
|
13 |
|
|
|
|
|
— |
|
|
|
13 |
|
|
|
Adjusted Earnings before interest and taxes |
|
$ |
329 |
|
|
$ |
242 |
|
|
36% |
|
$ |
1,454 |
|
|
$ |
1,367 |
|
|
6% |
Interest, net, as reported |
|
$ |
83 |
|
|
$ |
47 |
|
|
|
|
$ |
243 |
|
|
$ |
184 |
|
|
|
Costs associated with acquisition (2) |
|
|
— |
|
|
|
— |
|
|
|
|
|
(2 |
) |
|
|
— |
|
|
|
Adjusted Interest, net |
|
$ |
83 |
|
|
$ |
47 |
|
|
|
|
$ |
241 |
|
|
$ |
184 |
|
|
|
Adjusted Earnings before taxes |
|
$ |
246 |
|
|
$ |
195 |
|
|
|
|
$ |
1,213 |
|
|
$ |
1,183 |
|
|
|
Taxes on earnings (loss), as reported |
|
$ |
(3 |
) |
|
$ |
56 |
|
|
n/m |
|
$ |
190 |
|
|
$ |
270 |
|
|
(30)% |
Effective income tax rate, as reported |
|
|
50.0 |
% |
|
|
24.9 |
% |
|
n/m |
|
|
25.1 |
% |
|
|
23.9 |
% |
|
120 pts |
Costs associated with cost savings and optimization initiatives (1) |
|
|
9 |
|
|
|
3 |
|
|
|
|
|
26 |
|
|
|
16 |
|
|
|
Costs associated with acquisition (2) |
|
|
3 |
|
|
|
1 |
|
|
|
|
|
19 |
|
|
|
1 |
|
|
|
Commodity mark-to-market losses (gains) (3) |
|
|
7 |
|
|
|
(7 |
) |
|
|
|
|
6 |
|
|
|
(5 |
) |
|
|
Accelerated amortization (4) |
|
|
2 |
|
|
|
2 |
|
|
|
|
|
7 |
|
|
|
2 |
|
|
|
Pension and postretirement actuarial losses (gains) (5) |
|
|
8 |
|
|
|
(10 |
) |
|
|
|
|
8 |
|
|
|
(4 |
) |
|
|
Impairment charges (6) |
|
|
31 |
|
|
|
— |
|
|
|
|
|
31 |
|
|
|
— |
|
|
|
Certain litigation expenses (7) |
|
|
— |
|
|
|
— |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
Cybersecurity incident costs (8) |
|
|
— |
|
|
|
— |
|
|
|
|
|
1 |
|
|
|
— |
|
|
|
Adjusted Taxes on earnings |
|
$ |
57 |
|
|
$ |
45 |
|
|
27% |
|
$ |
288 |
|
|
$ |
280 |
|
|
3% |
Adjusted effective income tax rate |
|
|
23.2 |
% |
|
|
23.1 |
% |
|
10 pts |
|
|
23.7 |
% |
|
|
23.7 |
% |
|
0 pts |
Net earnings (loss) attributable to |
|
$ |
(3 |
) |
|
$ |
169 |
|
|
n/m |
|
$ |
567 |
|
|
$ |
858 |
|
|
(34)% |
Costs associated with cost savings and optimization initiatives (1) |
|
|
31 |
|
|
|
13 |
|
|
|
|
|
83 |
|
|
|
50 |
|
|
|
Costs associated with acquisition (2) |
|
|
11 |
|
|
|
4 |
|
|
|
|
|
109 |
|
|
|
4 |
|
|
|
Commodity mark-to-market losses (gains) (3) |
|
|
20 |
|
|
|
(23 |
) |
|
|
|
|
16 |
|
|
|
(16 |
) |
|
|
Accelerated amortization (4) |
|
|
5 |
|
|
|
5 |
|
|
|
|
|
20 |
|
|
|
5 |
|
|
|
Pension and postretirement actuarial losses (gains) (5) |
|
|
25 |
|
|
|
(31 |
) |
|
|
|
|
25 |
|
|
|
(11 |
) |
|
|
Impairment charges (6) |
|
|
98 |
|
|
|
— |
|
|
|
|
|
98 |
|
|
|
— |
|
|
|
Certain litigation expenses (7) |
|
|
2 |
|
|
|
— |
|
|
|
|
|
5 |
|
|
|
— |
|
|
|
Cybersecurity incident costs (8) |
|
|
— |
|
|
|
— |
|
|
|
|
|
2 |
|
|
|
— |
|
|
|
Charges associated with divestiture (9) |
|
|
— |
|
|
|
13 |
|
|
|
|
|
— |
|
|
|
13 |
|
|
|
Adjusted Net earnings attributable to |
|
$ |
189 |
|
|
$ |
150 |
|
|
26% |
|
$ |
925 |
|
|
$ |
903 |
|
|
2% |
Diluted net earnings per share attributable to |
|
$ |
(.01 |
) |
|
$ |
.57 |
|
|
n/m |
|
$ |
1.89 |
|
|
$ |
2.85 |
|
|
(34)% |
Costs associated with cost savings and optimization initiatives (1) |
|
|
.10 |
|
|
|
.04 |
|
|
|
|
|
.28 |
|
|
|
.17 |
|
|
|
Costs associated with acquisition (2) |
|
|
.04 |
|
|
|
.01 |
|
|
|
|
|
.36 |
|
|
|
.01 |
|
|
|
Commodity mark-to-market losses (gains) (3) |
|
|
.07 |
|
|
|
(.08 |
) |
|
|
|
|
.05 |
|
|
|
(.05 |
) |
|
|
Accelerated amortization (4) |
|
|
.02 |
|
|
|
.02 |
|
|
|
|
|
.07 |
|
|
|
.02 |
|
|
|
Pension and postretirement actuarial losses (gains) (5) |
|
|
.08 |
|
|
|
(.10 |
) |
|
|
|
|
.08 |
|
|
|
(.04 |
) |
|
|
Impairment charges (6) |
|
|
.33 |
|
|
|
— |
|
|
|
|
|
.33 |
|
|
|
— |
|
|
|
Certain litigation expenses (7) |
|
|
.01 |
|
|
|
— |
|
|
|
|
|
.02 |
|
|
|
— |
|
|
|
Cybersecurity incident costs (8) |
|
|
— |
|
|
|
— |
|
|
|
|
|
.01 |
|
|
|
— |
|
|
|
Charges associated with divestiture (9) |
|
|
— |
|
|
|
.04 |
|
|
|
|
|
— |
|
|
|
.04 |
|
|
|
Adjusted Diluted net earnings per share attributable to |
|
$ |
.63 |
|
|
$ |
.50 |
|
|
26% |
|
$ |
3.08 |
|
|
$ |
3.00 |
|
|
3% |
* The sum of individual per share amounts may not add due to rounding. |
||||||||||||||||||||
n/m - not meaningful |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240828835766/en/
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