In tough times, Campbell's soup sales are cooking

Is the homespun casserole dinner back in vogue now that lean times have taken a bite out of indulgent dining?

According to earnings yesterday by Campbell Soup Co., the answer may be yes.

Cream of mushroom, cream of broccoli, and Campbell's other "cooking" soups used in casserole recipes saw double-digit sales growth in the last year, the Camden company reported in its earnings release.

Strong demand for these, in particular, was the big force behind a 5 percent increase in total U.S. soup sales, spokesman Anthony Sanzio said.

Campbell can thank cost-conscious consumers who, coping with the recession, prepared more meals at home.

"The soup portfolio is very well-positioned as the value item," Douglas R. Conant, president and chief executive officer, told analysts in his first earnings-call appearance since an accident on the New Jersey Turnpike in early July.

Conant, whose injuries included broken ribs, had been working from home but returned to Campbell's South Jersey offices "several weeks ago," Sanzio said. Conant had not yet resumed a full schedule in Camden, Sanzio said.

The company's net income was $736 million, or $2.06 a share, for the fiscal year ending Aug. 2.

Full-year profit in 2008 was much higher, at $1.2 billion, or $3.06 a share. But that included a $462 million gain from the sale of Godiva Chocolatier Inc. in March 2008. Without that, adjusted net earnings for 2009 were $794 million, compared with $797 million in fiscal 2008, Sanzio said.

"We recognize that the consumer is under significant pressure in this economy," chief financial officer B. Craig Owens told an analyst who asked how unemployment affected demand for Campbell's products.

There are "some pieces of our business that actually benefit somewhat from a more difficult economy," Owens said, "and, of course, other pieces of our line that suffer from it."

Pepperidge Farm, with higher-priced snacks and baked goods, did not sell as well, and Campbell's North American Foodservice division took a hit as fewer consumers splurged on meals away from home.

Its biggest and most profitable division, however, was also its best performer: U.S. soups, sauces, and beverages, which accounted for $3.784 billion of Campbell's $7.6 billion in sales this past year, Sanzio said. Its Prego spaghetti sauce did well, but some V8 drinks did not.

Profit for the fiscal fourth quarter was $69 million, or 20 cents a share, compared with $89 million, or 24 cents a share, the same period a year earlier. The 22 percent drop in the quarterly results was attributed by Campbell to special items, such as a charge related to European trademarks. Excluding those items, the company's earnings were up 11 percent from the year-before quarter.

Sales for the year were down $7.6 billion, a 5 percent decline from $8.0 billion in 2008, which the company said was partly due to the fact that 2008 contained one extra selling week.