Food producer Campbell Soup Company (NYSE:CPB) cut full-year profit guidance after fiscal first quarter numbers came in short of expectations.
Andy Warhol’s favourite soup maker said it now expected fiscal 2018 earnings per share (EPS) to fall somewhere in the range of US$2.95 to US$3.02, compared to its previous guidance of US$3.04 to US$3.11.
The current median forecast of analysts who cover the stock is US$3.05.
Net income in the quarter fell to US$275mln from US$292mln the year before on revenue that slipped to US$275mln from the previous year’s US$292mln.
Adjusted EPS was 92 cents a share, which was five cents below the consensus forecast.
Net sales dipped 2% to US$2.16bn from US$2.20bn, with company boss Denise Morrison admitting that competitive pressure is putting pressure on the top line.
Like-for-like sales also dipped 2%, with much of the decline down to a 9% decline in US sales of the iconic soup range.
“Our bottom line performance was negatively impacted by a lower adjusted gross margin rate due in part to cost inflation, higher carrot costs and escalating transportation and logistics costs following the hurricane season,” Morrison said.
“In this challenging climate, we are focused on sharpening our plans for the remainder of the year while continuing to position Campbell for growth through investments to differentiate our brands, drive innovation and accelerate our e-commerce capabilities,” she added.
Campbell’s stock was down 7.7% at US$46.10 in pre-market trading.