Campbell Soup Co (CPB) Q4 2024 Earnings Call Transcript Highlights: Strong Performance Driven by Sovos Brands and Soup Gains

GuruFocus08-30

Release Date: August 29, 2024For the complete transcript of the earnings call, please refer to the full earnings call transcript. Positive Points Sequential volume improvement across both divisions, ...

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Positive Points Sequential volume improvement across both divisions, ...</p>\n\n<a href=\"https://www.gurufocus.com/news/2513730/campbell-soup-co-cpb-q4-2024-earnings-call-transcript-highlights-strong-performance-driven-by-sovos-brands-and-soup-gains\">Source Link</a>\n\n</div>\n","source":"gurufocus_highlight","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Campbell Soup Co (CPB) Q4 2024 Earnings Call Transcript Highlights: Strong Performance Driven by Sovos Brands and Soup Gains</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nCampbell Soup Co (CPB) Q4 2024 Earnings Call Transcript Highlights: Strong Performance Driven by Sovos Brands and Soup Gains\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-08-30 14:26 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://www.gurufocus.com/news/2513730/campbell-soup-co-cpb-q4-2024-earnings-call-transcript-highlights-strong-performance-driven-by-sovos-brands-and-soup-gains><strong>GuruFocus</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Release Date: August 29, 2024For the complete transcript of the earnings call, please refer to the full earnings call transcript. Positive Points Sequential volume improvement across both divisions, ...</p>\n\n<a href=\"https://www.gurufocus.com/news/2513730/campbell-soup-co-cpb-q4-2024-earnings-call-transcript-highlights-strong-performance-driven-by-sovos-brands-and-soup-gains\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"CPB","symbol_name":"金宝汤","start_time":0,"source_url":"https://www.gurufocus.com/news/2513730/campbell-soup-co-cpb-q4-2024-earnings-call-transcript-highlights-strong-performance-driven-by-sovos-brands-and-soup-gains","article_id":"2463783232","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2463783232","pubTimestamp":1724999175,"columns":[],"sourceInfo":{"source_id":"gurufocus_highlight","name":"GuruFocus"},"weMediaInfo":null,"summary":"A: Mark Clouse, CEO: The consumer landscape is favorable for Meals & Beverages as more people are eating at home, driving value and convenience. Our brands fit well in this environment. The growth is broad-based across segments, with soup showing significant volume-driven recovery. The broth category is particularly strong, even with private label competition. Rao's and Prego sauces are also performing well, with Rao's growing 25% in Q4. We expect continued positive contributions from these brands.A: Mark Clouse, CEO: We see positive trends in many of our categories, with 75% back to growth. While Snacks has some share-driven pressure, categories like soup and pasta sauce are growing. We believe the recovery is not a question of if, but when, and our categories are on the upper edge of the recovery curve.","collect":0,"end_time":0,"defaultTopTitle":"gurufocus.com","property":["earning"],"viewcount":null,"language":"en","relate_stocks":{"CPB":"金宝汤","SOVO":"Sovos Brands, Inc."},"translate_title":"金宝汤公司(CPB)2024年第四季度收益看涨期权成绩单亮点：Sovos品牌和汤类收益推动强劲表现","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"CPB":1,"SOVO":1},"content_text":"Release Date: August 29, 2024For the complete transcript of the earnings call, please refer to the full earnings call transcript. Positive Points Sequential volume improvement across both divisions, with double-digit year-over-year adjusted EBIT and EPS growth.Successful integration and momentum of Sovos Brands, contributing positively to Meals & Beverages.Strong performance in the Soup business, with dollar consumption up 2% and 6% in the latest four weeks.Rao's brand continues to show strong growth, with high consumer acceptance across all economic demographics.Improved operating margins in both Meals & Beverages and Snacks divisions, reflecting effective cost management and productivity initiatives. Negative Points Organic net sales declined 1% in Q4 compared to the prior year, driven by headwinds in the Snacks business.Snacks category recovery is slower than expected, with competitive pressure from new entrants affecting market share.Unfavorable net pricing realization and moderate cost inflation impacting adjusted gross profit margins.Pressure on ready-to-serve soup category, with some trading down observed.Expected normalization of broth share in the second half of fiscal '25, potentially impacting overall sales growth. Q & A Highlights Q: Mark, can you discuss the key drivers behind the 1% organic sales growth in Meals and Beverages and the sustainability of these improved results?  A: Mark Clouse, CEO: The consumer landscape is favorable for Meals & Beverages as more people are eating at home, driving value and convenience. Our brands fit well in this environment. The growth is broad-based across segments, with soup showing significant volume-driven recovery. The broth category is particularly strong, even with private label competition. Rao's and Prego sauces are also performing well, with Rao's growing 25% in Q4. We expect continued positive contributions from these brands.\nQ: Why do you remain confident in the broader industry recovery despite skepticism from some investors?  A: Mark Clouse, CEO: We see positive trends in many of our categories, with 75% back to growth. While Snacks has some share-driven pressure, categories like soup and pasta sauce are growing. We believe the recovery is not a question of if, but when, and our categories are on the upper edge of the recovery curve.\nQ: How are you addressing the competitive pressure from new entrants in the Snacks category?  A: Mark Clouse, CEO: We are focusing on innovation and marketing to defend our brands. For example, in pretzels, we have Snyder's of Hanover, Snack Factory, and Goldfish. In Kettle chips, we have Kettle and Cape Cod brands. We are also increasing marketing support and ensuring competitive pricing. Our elevated segments are recovering faster, and we are well-positioned to address the competition.\nQ: Does your guidance assume a reversal in broth share next year?  A: Mark Clouse, CEO: Yes, we expect broth share to normalize in the second half of the year. While we will fight to retain households, our guidance prudently assumes some share normalization.\nQ: How are you balancing the risks of a potential recession with your growth plans?  A: Mark Clouse, CEO: We are planning for a slow recovery and have a portfolio that performs well in various economic environments. Our brands offer value and convenience, which are attractive in a recession. We expect a gradual improvement in volume trends and have positioned our guidance to reflect a balanced approach.\nQ: How does the dynamic of Rao's growth across all income segments inform your marketing spend for 2025?  A: Mark Clouse, CEO: Rao's offers great value compared to dining out, which drives its growth across income segments. We will continue to emphasize value in our marketing while also focusing on innovation and brand equity. Our marketing spend will balance value messaging with driving brand differentiation and new product launches.\nQ: Can you clarify the impact of the 53rd week on your fiscal 2025 guidance?  A: Carrie Anderson, CFO: The benefit of the 53rd week is included in our reported net sales and adjusted EBIT growth but has been removed from our organic net sales growth. It is estimated to contribute approximately 2 points of growth to reported net sales and adjusted EBIT.\nQ: How are you addressing the pressure in the unseasoned or plain potato chips and tortilla chips segments?  A: Mark Clouse, CEO: We are focusing on innovation and marketing to differentiate our brands like Kettle, Cape Cod, and Late July. These brands play in more elevated segments, which are recovering faster. We are also ensuring competitive pricing and promotional support to maintain our market position.\nQ: What are your expectations for the phasing of organic sales growth throughout fiscal 2025?  A: Carrie Anderson, CFO: We expect Q1 organic sales growth to be relatively flat, with sequential improvement throughout the year. The second half will see some headwinds from broth share normalization, but we expect Snacks to return to more normal growth patterns, balancing the overall performance.\nQ: How do you plan to support your brands and innovation launches in fiscal 2025?  A: Mark Clouse, CEO: We will increase our marketing spend to support innovation and drive brand equity. This includes value-centric messaging and promoting new products. We aim to balance value communication with highlighting the unique attributes of our brands to drive consumer engagement and growth.\nFor the complete transcript of the earnings call, please refer to the full earnings call transcript.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2463783232"}