caret-down

Campbell Reports Second Quarter Results: Earnings Per Share of $.72, Including $.04 Gain from Property Sale; Net Sales Increase 4 Percent; Company Raises Full Year Forecast For EPS Growth

CAMDEN, N.J.–(BUSINESS WIRE)–Feb. 16, 2007–Campbell Soup
Company (NYSE:CPB) today reported earnings from continuing operations
increased to $284 million in the second quarter ended January 28, 2007
from $239 million in the prior year. Earnings per share from
continuing operations for the quarter were $.72, compared with $.58 in
the year-ago period.

The current quarter’s earnings from continuing operations included
a $14 million gain, or $.04 per share, from the sale of an idle
Pepperidge Farm facility in Connecticut. Excluding that gain, earnings
from continuing operations were $270 million, an increase of 13
percent. Additionally, for comparability, the prior period’s earnings
per share from continuing operations require an adjustment to reflect
the pro forma impact of using $620 million of the proceeds from the
divestiture of the company’s U.K. and Ireland businesses to purchase
17 millions shares of Campbell stock, a benefit of $.02. Adjusting for
these items, earnings per share in the second quarter were $.68
compared to $.60 a year ago, an increase of 13 percent.

For the second quarter, net sales rose 4 percent to $2.3 billion,
reflecting the following factors:

    --  Volume and mix added 1 percent

    --  Price and sales allowances added 2 percent

    --  Currency added 1 percent

For the first half, earnings from continuing operations were $553
million compared to $525 million a year earlier. Earnings per share
were $1.38 compared to $1.27 in the prior period. The current year
included the $14 million gain, or $.04 per share, from the sale of the
idle Pepperidge Farm facility. The prior period included an $8 million
after-tax gain, or $.02 per share, from the change of inventory
accounting method from LIFO to average cost; a $60 million non-cash
gain, or $.14 per share, from a favorable resolution of a U.S. tax
contingency; and an $8 million expense, or $.02 per share, associated
with the repatriation of non-U.S. earnings under the American Jobs
Creation Act. To provide comparability of results, as previously
stated, the company’s adjusted 2006 results reflect the pro forma
impact of repurchasing 17 million shares of Campbell stock, which
increases prior-year earnings per share by $.05. After factoring in
these items, earnings from continuing operations for the first half
were $539 million compared to $465 million, an increase of 16 percent.
Adjusted earnings per share were $1.35 compared to $1.17 a year ago,
an increase of 15 percent.

For the first half of fiscal 2007, net sales rose 6 percent to
$4.4 billion, reflecting the following factors:

    --  Volume and mix added 2 percent

    --  Price and sales allowances added 3 percent

    --  Currency added 1 percent

A detailed reconciliation of the adjusted fiscal 2007 and 2006
financial information to the reported information is attached to this
release.

Douglas R. Conant, Campbell’s President and Chief Executive
Officer, said, “We’re off to a strong start in fiscal 2007. For the
first half, our U.S. soup business delivered strong results with solid
sales growth and enhanced profitability. Sales increased 4 percent
with solid gains in condensed, ready-to-serve, and broth. We are
encouraged by the early performance of our lower sodium soups,
featuring natural sea salt. Initial trial and repeat purchases of
these products have exceeded our plans and they are contributing to
our growth. Despite a modest decline in U.S. soup sales during the
second quarter, we are very satisfied with the performance of this
business.

“Beyond U.S. soup, we are especially pleased with the performance
of our Pepperidge Farm, Arnott’s, and U.S. beverage businesses in the
first half. Our strategic growth platforms of simple meals and baked
snacks continue to gain momentum in the marketplace.

“Given our strong first half performance, we are increasing our
forecasted fiscal 2007 EPS growth from continuing operations from a
range of 5 to 7 percent to a range of 10 to 12 percent, from the
adjusted pro forma fiscal 2006 base of $1.73.”

    Other Second Quarter Highlights

    --  Gross margin for the second quarter improved to 42.9 percent
        from 42.1 percent, as pricing and productivity gains exceeded
        cost inflation.

    --  Marketing and selling expenses increased $4 million to $361
        million, primarily due to higher selling expenses, which were
        partially offset by reduced advertising and consumer promotion
        expenses.

    --  Net debt, or total debt less cash and cash equivalents, was
        $2.373 billion versus $2.639 billion a year ago, a reduction
        of $266 million.

    Other First Half Highlights

    --  Gross Margin increased to 42.7 percent from 42.2 percent, as
        higher selling prices and productivity gains exceeded cost
        inflation. The prior year's percentage included a $13 million
        benefit, or 0.3 percentage points, from a change in the method
        of accounting for inventory from LIFO to average cost.

    --  Marketing and selling expenses increased $2 million to $677
        million.

    --  Cash flow from operations were $328 million compared to $649
        million in the prior period. The change is primarily the
        result of increases in working capital and the payment of $83
        million to settle foreign currency hedges related to the
        divested U.K. business.

    --  The company repurchased 22.3 million shares for $842 million
        under three programs: the program utilizing proceeds from the
        divestiture of the U.K. and Ireland businesses; the company's
        three-year strategic share repurchase program of $600 million
        announced in November 2005; and the program to offset the
        impact of dilution from shares issued under stock compensation
        plans.

    --  Earnings from discontinued operations were $23 million
        compared to $31 million in the first half of the prior year.
        The current year reflects a $39 million pre-tax gain, or $.06
        per share, from the sale of the U.K. and Ireland businesses.
        The prior year's earnings per share of $.07 represented
        operating performance.

    Summary of Fiscal 2007 Second Quarter Results by Segment

    U.S. Soup, Sauces and Beverages

Sales for U.S. Soup, Sauces and Beverages were $1.028 billion, up
1 percent compared with a year ago. A breakdown of the change in sales
follows:

    --  Volume and mix subtracted 2 percent

    --  Price and sales allowances added 3 percent

Operating earnings increased to $274 million from $242 million in
the year-ago quarter, driven by higher selling prices, productivity
gains, and lower advertising expenditures.

U.S. soup sales for the quarter declined 1 percent. Further
details of sales results for the quarter include the following:

    --  Sales of all soups were negatively impacted by lower seasonal
        customer inventory builds in the current quarter compared to a
        year ago.

    --  Sales of "Campbell's" condensed soups were flat in the
        quarter. "Campbell's" condensed cooking soup sales grew from
        more effective advertising focused on casseroles and other
        simple meals. These gains were offset by declines in condensed
        eating soups.

    --  Sales of ready-to-serve soups declined 6 percent. Sales
        declined in "Campbell's Select" and "Campbell's Chunky" soups.
        However, sales of "Campbell's Select Gold Label" premium
        soups, and sales of the convenience soup platform, which
        includes soups in microwaveable bowls and cups, grew in the
        quarter.

    --  "Swanson" broth sales increased 15 percent, driven by
        successful holiday promotional activity and higher levels of
        more effective advertising. Consumer demand for
        aseptically-packaged broth continued to be strong.

    Highlights of this segment's other businesses include:

    --  Beverage sales increased significantly. "V8" vegetable juices
        recorded a double-digit sales increase primarily due to
        consumer demand for lower sodium varieties. "V8 V-Fusion" has
        proven to be popular with consumers and has contributed to
        sales growth. Launched in the second quarter of last year, "V8
        V-Fusion" is a 100-percent juice beverage that provides a full
        serving of vegetables and a full serving of fruit in each
        serving. The company introduced new varieties,
        pomegranate-blueberry and "V8 V-Fusion Light," during the
        quarter. Sales of "V8 Splash" juice beverages declined in the
        quarter.

    --  "Prego" pasta sauce sales increased by double digits due to
        more effective advertising and promotional activity.

    --  "Pace" Mexican sauce sales decreased slightly due to a decline
        in marketing activity.

For the first half, sales increased 5 percent to $2.080 billion. A
breakdown of the change in sales follows:

    --  Volume and mix added 1 percent

    --  Price and sales allowances added 3 percent

    --  Decreased promotional spending added 1 percent

Operating earnings increased to $596 million from $530 million in
the year-ago period, driven by higher sales, lower marketing expenses,
and improved gross margins. Earnings for the first half of 2006
included an $8 million benefit from a change in the method of
accounting for inventory.

Baking and Snacking

Sales for Baking and Snacking were $454 million, up 6 percent
compared with a year ago. A breakdown of the change in sales follows:

    --  Volume and mix added 1 percent

    --  Price and sales allowances added 3 percent

    --  Currency added 2 percent

Operating earnings were $77 million compared to $40 million a year
ago. Earnings in the current quarter included a $23 million gain from
the sale of the idle Pepperidge Farm facility. Excluding this item,
operating earnings increased significantly, driven by double-digit
gains at Pepperidge Farm and Arnott’s.

    Further details of sales results include the following:

    --  Sales of Pepperidge Farm cookies and crackers increased,
        driven by double-digit growth of "Goldfish" crackers, which
        benefited from strong sales of 100-calorie packs, expanded
        distribution of single-serve packages, and higher levels of
        advertising.

    --  Pepperidge Farm bakery sales grew in the quarter mainly driven
        by continued consumer demand for whole grain breads.

    --  Arnott's sales increased significantly due to currency and the
        growth of chocolate cookie varieties, especially the "Tim Tam"
        brand. These gains were partially offset by declines in the
        snack foods business.

For the first half, sales increased 6 percent to $938 million.
Operating earnings increased to $145 million from $90 million a year
ago. Earnings in the current period included a $23 million gain from
the sale of the idle Pepperidge Farm facility. Earnings for the first
half of the prior year included a $5 million gain from a change in the
method of accounting for inventory. Excluding these items, operating
earnings increased significantly, driven by double-digit gains at
Pepperidge Farm and Arnott’s.

International Soup and Sauces

Sales for International Soup and Sauces were $404 million, up 12
percent compared with a year ago. A breakdown of the change in sales
follows:

    --  Volume and mix added 6 percent

    --  Currency added 6 percent

Operating earnings were $59 million compared to $61 million in the
year-ago quarter. Operating earnings performance was driven by
declines in Europe due to increased marketing expenses to support new
products, partially offset by currency. Additionally, operating
earnings were impacted by expenses to establish the company’s
businesses in Russia and China.

    Further details of sales results include the following:

    --  Sales in Europe increased due to currency and gains in
        Germany, where successful promotional activity and expanded
        distribution boosted "Erasco" sales.

    --  In Canada, solid sales gains were driven by the growth of
        ready-to-serve soups and aseptically-packaged broth.

For the first half, sales increased 11 percent to $750 million,
primarily driven by currency and volume and mix gains. Operating
earnings increased to $107 million from $96 million in the year-ago
period. The operating earnings performance was driven by double-digit
increases in Canada and currency, partially offset by lower earnings
in Europe and higher expenses to establish the company’s businesses in
Russia and China.

Other

The balance of the portfolio includes the Godiva Chocolatier
business worldwide and the Away From Home business in the U.S. and
Canada.

Sales were $366 million, up 4 percent compared with the same
period a year ago. A breakdown of the change in sales follows:

    --  Volume and mix added 1 percent

    --  Price and sales allowances added 3 percent

    --  Increased promotional spending subtracted 1 percent

    --  Currency added 1 percent

Operating earnings were $70 million compared to $69 million in the
year-ago quarter.

    Further details include the following:

    --  Godiva Chocolatier sales increased in North America, Europe,
        and Asia. In North America, Godiva same-store sales decreased
        slightly, offset by gains in wholesale and direct channels.

    --  Away From Home sales increased due to strong growth of frozen
        and canned soups, and beverages, partially offset by declines
        of refrigerated soup sales.

For the first half, sales increased 4 percent to $637 million.
Operating earnings were $96 million compared to $95 million in the
year-ago period.

Non-GAAP Financial Information

A reconciliation of the adjusted fiscal 2007 and 2006 financial
information to the reported information is attached to this release
and can also be found on the company’s website at
www.campbellsoupcompany.com in the “Investor Center” section.

Conference Call

The company will host a conference call to discuss these results
on February 16, 2007 at 10:00 a.m. Eastern Time. U.S. participants may
access the call at 1-866-814-1933 and non-U.S. participants at
1-703-639-1365. Participants should call at least five minutes prior
to the starting time. The passcode is “Campbell Soup” and the
conference leader is Len Griehs. The call will also be broadcast live
over the Internet at www.campbellsoupcompany.com and can be accessed
by clicking on the “Webcast” banner. A recording of the call will be
available approximately two hours after it is completed through
midnight February 23, 2007 at 1-888-266-2081 or 1-703-925-2533. The
access code is 1030255.

Forward-Looking Statements

This release contains “forward-looking statements” which reflect
the company’s current expectations about its future plans and
performance, including statements concerning the impact of marketing
investments and strategies, pricing, share repurchase, new product
introductions and innovation, cost-saving initiatives, quality
improvements, and portfolio strategies, including divestitures, on
sales, earnings, and margins. These forward-looking statements rely on
a number of assumptions and estimates which could be inaccurate and
which are subject to risks and uncertainties. Actual results could
vary materially from those anticipated or expressed in any
forward-looking statement made by the company. Please refer to the
company’s most recent Form 10-K and subsequent filings for a further
discussion of these risks and uncertainties. The company disclaims any
obligation or intent to update the forward-looking statements in order
to reflect events or circumstances after the date of this release.

Reporting Segments

Campbell Soup Company earnings results are reported for the
following segments:

U.S. Soup, Sauces and Beverages includes the following retail
businesses: “Campbell’s” brand condensed and ready-to-serve soups,
“Swanson” broth and canned poultry businesses, “Prego” pasta sauce,
“Pace” Mexican sauce, “Campbell’s Chunky” chili, “Campbell’s” canned
pasta, gravies and beans, “Campbell’s Supper Bakes” meal kits, “V8”
vegetable juices, “V8 Splash” juice beverages, and “Campbell’s” tomato
juice.

Baking and Snacking includes the following businesses: “Pepperidge
Farm” cookies, crackers, breads and frozen products in U.S. retail,
“Arnott’s” biscuits in Australia and Asia Pacific, and “Arnott’s”
salty snacks in Australia.

International Soup and Sauces includes the soup, sauce and
beverage businesses outside of the United States, including Canada,
Europe, Mexico, Latin America, and the Asia Pacific region.

Other includes the Godiva Chocolatier business worldwide and the
Away From Home business in the U.S. and Canada.

About Campbell Soup Company

Campbell Soup Company is a global manufacturer and marketer of
high quality simple meals, including soups, baked snacks,
vegetable-based beverages, and premium chocolate products. Founded in
1869, the company has a portfolio of market-leading brands, including
“Campbell’s,” “Pepperidge Farm,” “Arnott’s,” “V8,” and “Godiva.” For
more information on the company, visit Campbell’s website at
www.campbellsoupcompany.com.

                  CAMPBELL SOUP COMPANY CONSOLIDATED
                  STATEMENTS OF EARNINGS (unaudited)
                 (millions, except per share amounts)


                                                 THREE MONTHS ENDED
                                               -----------------------
                                               January 28, January 29,
                                                  2007        2006
                                               ----------- -----------

Net sales                                      $    2,252  $    2,159
                                               ----------- -----------

Costs and expenses
   Cost of products sold                            1,286       1,251
   Marketing and selling expenses                     361         357
   Administrative expenses                            155         143
   Research and development expenses                   25          24
   Other expenses / (income)                          (20)          1
                                               ----------- -----------
Total costs and expenses                            1,807       1,776
                                               ----------- -----------

Earnings before interest and taxes                    445         383
Interest, net                                          39          43
                                               ----------- -----------
Earnings before taxes                                 406         340

Taxes on earnings                                     122         101
                                               ----------- -----------

Earnings from continuing operations                   284         239
Earnings from discontinued operations                   1          15
                                               ----------- -----------
Net earnings                                   $      285  $      254
                                               =========== ===========

Per share - basic
   Earnings from continuing operations         $      .74  $      .59
   Earnings from discontinued operations                -         .04
                                               ----------- -----------
   Net earnings                                $      .74  $      .62
                                               =========== ===========

   Dividends                                   $      .20  $      .18
                                               =========== ===========

Weighted average shares outstanding - basic           384         408
                                               =========== ===========


Per share - assuming dilution
   Earnings from continuing operations         $      .72  $      .58
   Earnings from discontinued operations                -         .04
                                               ----------- -----------
   Net earnings                                $      .72  $      .61
                                               =========== ===========

Weighted average shares outstanding - assuming
 dilution                                             395         414
                                               =========== ===========

In fiscal 2007, the company recognized a pre-tax gain of $23 ($14
after tax or $.04 per share) from the sale of an idle manufacturing
facility. The gain is included in Other expenses / (income).

The sum of the individual per share amounts does not equal net
earnings due to rounding.

                  CAMPBELL SOUP COMPANY CONSOLIDATED
                  STATEMENTS OF EARNINGS (unaudited)
                 (millions, except per share amounts)


                                                  SIX MONTHS ENDED
                                               -----------------------
                                               January 28, January 29,
                                                  2007        2006
                                               ----------- -----------

Net sales                                      $    4,405  $    4,161
                                               ----------- -----------

Costs and expenses
   Cost of products sold                            2,522       2,407
   Marketing and selling expenses                     677         675
   Administrative expenses                            290         268
   Research and development expenses                   51          48
   Other income                                       (18)         (1)
                                               ----------- -----------
Total costs and expenses                            3,522       3,397
                                               ----------- -----------

Earnings before interest and taxes                    883         764
Interest, net                                          80          69
                                               ----------- -----------
Earnings before taxes                                 803         695

Taxes on earnings                                     250         170
                                               ----------- -----------

Earnings from continuing operations                   553         525
Earnings from discontinued operations                  23          31
                                               ----------- -----------
Net earnings                                   $      576  $      556
                                               =========== ===========

Per share - basic
   Earnings from continuing operations         $     1.42  $     1.28
   Earnings from discontinued operations              .06         .08
                                               ----------- -----------
   Net earnings                                $     1.48  $     1.36
                                               =========== ===========

   Dividends                                   $      .40  $      .36
                                               =========== ===========

Weighted average shares outstanding - basic           389         409
                                               =========== ===========


Per share - assuming dilution
   Earnings from continuing operations         $     1.38  $     1.27
   Earnings from discontinued operations              .06         .07
                                               ----------- -----------
   Net earnings                                $     1.44  $     1.34
                                               =========== ===========

Weighted average shares outstanding - assuming
 dilution                                             400         414
                                               =========== ===========

In fiscal 2007, the company recognized a pre-tax gain of $23 ($14
after tax or $.04 per share) from the sale of an idle manufacturing
facility. The gain is included in Other income.

In the first quarter of fiscal 2006, the company changed the
method of accounting for certain U.S. inventories from the LIFO method
to the average cost method. The impact of the change was reflected as
a one-time non-cash pre-tax benefit of $13 ($8 after tax or $.02 per
share).

In the first quarter of fiscal 2006, the company recorded a
non-cash tax benefit of $47 resulting from the favorable resolution of
a U.S. tax contingency related to a prior period. In addition, the
company reduced interest expense and accrued interest payable by $21
and adjusted deferred tax expense by $8 ($13 after tax). The aggregate
non-cash impact of the settlement on earnings from continuing
operations was $60, or $.14 per share.

In the first quarter of fiscal 2006, incremental tax expense of $8
(or $.02 per share) was recorded related to earnings repatriated from
non-U.S. subsidiaries under the provision of the American Jobs
Creation Act.

                  CAMPBELL SOUP COMPANY CONSOLIDATED
       SUPPLEMENTAL SCHEDULE OF SALES AND EARNINGS (unaudited)
                 (millions, except per share amounts)


                                         THREE MONTHS ENDED
                                       -----------------------
                                       January 28, January 29, Percent
Sales                                     2007        2006     Change
-------------------------------------- ----------- ----------- -------
Contributions:
   U.S. Soup, Sauces and Beverages     $    1,028  $    1,018       1%
   Baking and Snacking                        454         429       6%
   International Soup and Sauces              404         361      12%
   Other                                      366         351       4%
                                       ----------- -----------
Total sales                            $    2,252  $    2,159       4%
                                       =========== ===========





Earnings
--------------------------------------
Contributions:
   U.S. Soup, Sauces and Beverages     $      274  $      242      13%
   Baking and Snacking                         77          40      93%
   International Soup and Sauces               59          61      -3%
   Other                                       70          69       1%
                                       ----------- -----------
Total operating earnings                      480         412      17%
Unallocated corporate expenses                (35)        (29)
                                       ----------- -----------

Earnings before interest and taxes            445         383      16%
Interest, net                                 (39)        (43)
Taxes on earnings                            (122)       (101)
                                       ----------- -----------

Earnings from continuing operations           284         239      19%
Earnings from discontinued operations           1          15
                                       ----------- -----------
Net earnings                           $      285  $      254      12%
                                       =========== ===========

Per share - assuming dilution
   Earnings from continuing operations $      .72  $      .58      24%
   Earnings from discontinued
    operations                                  -         .04
                                       ----------- -----------
Net earnings                           $      .72  $      .61
                                       =========== ===========

In fiscal 2007, the company recognized a pre-tax gain of $23 ($14
after tax or $.04 per share) from the sale of an idle manufacturing
facility in the Baking and Snacking segment.

The sum of the individual per share amounts does not equal net
earnings due to rounding.

                  CAMPBELL SOUP COMPANY CONSOLIDATED
       SUPPLEMENTAL SCHEDULE OF SALES AND EARNINGS (unaudited)
                 (millions, except per share amounts)


                                          SIX MONTHS ENDED
                                       -----------------------
                                       January 28, January 29, Percent
Sales                                     2007        2006     Change
-------------------------------------- ----------- ----------- -------
Contributions:
   U.S. Soup, Sauces and Beverages     $    2,080  $    1,988       5%
   Baking and Snacking                        938         887       6%
   International Soup and Sauces              750         673      11%
   Other                                      637         613       4%
                                       ----------- -----------
Total sales                            $    4,405  $    4,161       6%
                                       =========== ===========





Earnings
--------------------------------------
Contributions:
   U.S. Soup, Sauces and Beverages     $      596  $      530      12%
   Baking and Snacking                        145          90      61%
   International Soup and Sauces              107          96      11%
   Other                                       96          95       1%
                                       ----------- -----------
Total operating earnings                      944         811      16%
Unallocated corporate expenses                (61)        (47)
                                       ----------- -----------

Earnings before interest and taxes            883         764      16%
Interest, net                                 (80)        (69)
Taxes on earnings                            (250)       (170)
                                       ----------- -----------

Earnings from continuing operations           553         525       5%
Earnings from discontinued operations          23          31
                                       ----------- -----------
Net earnings                           $      576  $      556       4%
                                       =========== ===========

Per share - assuming dilution
   Earnings from continuing operations $     1.38  $     1.27       9%
   Earnings from discontinued
    operations                                .06         .07
                                       ----------- -----------
Net earnings                           $     1.44  $     1.34
                                       =========== ===========

In fiscal 2007, the company recognized a pre-tax gain of $23 ($14
after tax or $.04 per share) from the sale of an idle manufacturing
facility in the Baking and Snacking segment.

In the first quarter of fiscal 2006, the company changed the
method of accounting for certain U.S. inventories from the LIFO method
to the average cost method. The impact of the change was reflected as
a one-time non-cash pre-tax benefit of $13 ($8 after tax or $.02 per
share). The pre-tax benefit is reflected as follows: U.S. Soup, Sauces
and Beverages – $8 and Baking and Snacking – $5.

In the first quarter of fiscal 2006, the company recorded a
non-cash tax benefit of $47 resulting from the favorable resolution of
a U.S. tax contingency related to a prior period. In addition, the
company reduced interest expense and accrued interest payable by $21
and adjusted deferred tax expense by $8 ($13 after tax). The aggregate
non-cash impact of the settlement on earnings from continuing
operations was $60, or $.14 per share.

In the first quarter of fiscal 2006, incremental tax expense of $8
(or $.02 per share) was recorded related to earnings repatriated from
non-U.S. subsidiaries under the provision of the American Jobs
Creation Act.

                  CAMPBELL SOUP COMPANY CONSOLIDATED
                      BALANCE SHEETS (unaudited)
                              (millions)


                                               January 28, January 29,
                                                  2007        2006
                                               ----------- -----------

Current assets                                 $    2,150  $    1,880

Plant assets, net                                   1,943       1,940

Intangible assets, net                              2,372       3,011

Other assets                                          620         315

                                               ----------- -----------
     Total assets                              $    7,085  $    7,146
                                               =========== ===========


Current liabilities                            $    2,499  $    2,303

Long-term debt                                      2,111       2,219

Nonpension postretirement benefits                    275         277

Other liabilities                                     745         726

Shareowners' equity                                 1,455       1,621

                                               ----------- -----------
     Total liabilities and shareowners' equity $    7,085  $    7,146
                                               =========== ===========


Total debt                                     $    2,856  $    2,906
                                               =========== ===========

Cash and cash equivalents                      $      483  $      267
                                               =========== ===========

Net debt                                       $    2,373  $    2,639
                                               =========== ===========

Certain reclassifications were made to prior year financial
statements.

        Reconciliation of GAAP and Non-GAAP Financial Measures
                Second Quarter Ended January 28, 2007

Campbell Soup Company uses certain non-GAAP financial measures as
defined by the Securities and Exchange Commission in certain
communications. These non-GAAP financial measures are measures of
performance not defined by accounting principles generally accepted in
the United States and should be considered in addition to, not in lieu
of, GAAP reported measures.

The company believes that net debt is a non-GAAP measure that
provides additional meaningful comparisons between current results and
prior period results and a useful perspective on the financial
condition of the business. Interest income earned on cash and cash
equivalents partially offsets interest expense on debt. Cash and cash
equivalents are available to repay outstanding debt upon maturity.

The table below summarizes information on total debt and cash and
cash equivalents:

             (millions)              January 28, 2007 January 29, 2006
                                     ---------------- ----------------

Current notes payable                $           745  $           687
Long-term debt                                 2,111            2,219
                                     ---------------- ----------------
Total debt                           $         2,856  $         2,906

Less: Cash and cash equivalents                 (483)            (267)
                                     ---------------- ----------------
Net debt                             $         2,373  $         2,639
                                     ================ ================

The company believes that financial information excluding a change
in accounting method and other transactions not considered to be part
of the ongoing business improves the comparability of year-to-year
results. Consequently, the company believes that investors may be able
to better understand its earnings results if these transactions are
excluded from the results.

The following change in accounting method, certain tax matters and
other transactions impacted earnings from continuing operations:

(1) In the second quarter of fiscal 2007, the company recorded a pre-
     tax gain of $23 million ($14 million after tax or $.04 per share)
     associated with the sale of an idle manufacturing facility.

(2) In the first quarter of fiscal 2006, the company changed the
     method of determining the cost of certain U.S. inventories from
     the LIFO method to the average cost method. As a result, the
     company recorded a $13 million pre-tax ($8 million after tax or
     $.02 per share) benefit from the change in accounting method.

(3) In the first quarter of fiscal 2006, the company recorded a non-
     cash tax benefit of $47 million resulting from the favorable
     resolution of a U.S. tax contingency related to a prior period.
     In addition, the company reduced interest expense and accrued
     interest payable by $21 million and adjusted deferred tax expense
     by $8 million ($13 million after tax). The aggregate non-cash
     impact of the settlement on earnings from continuing operations
     was $60 million, or $.14 per share.

(4) In the first quarter of fiscal 2006, the company recorded
     incremental tax expense of $8 million ($.02 per share) associated
     with the repatriation of earnings under the American Jobs
     Creation Act ("AJCA").

The tables below reconcile financial information, presented in
accordance with GAAP, to financial information excluding the impact of
change in accounting method and certain transactions:

  (millions, except per share
            amounts)                   Second Quarter
                                 ---------------------------
                                 Jan. 28, 2007 Jan. 29, 2006 % Change
                                 --------------------------- ---------

Earnings before interest and
 taxes, as reported              $        445  $        383
Deduct: Gain on sale of an idle
 manufacturing facility (1)               (23)            -
                                 ------------- -------------
Adjusted Earnings before
 interest and taxes              $        422  $        383        10%
                                 ------------- -------------

Interest, net, as reported       $         39  $         43

                                 ------------- -------------
Adjusted Earnings before taxes   $        383  $        340        13%
                                 ------------- -------------

Taxes on earnings, as reported   $        122  $        101
Deduct: Tax impact of gain on
 sale of an idle manufacturing
 facility (1)                              (9)            -
                                 ------------- -------------
Adjusted Taxes on earnings       $        113  $        101
                                 ------------- -------------
Adjusted effective income tax
 rate                                    29.5%         29.7%

Earnings from continuing
 operations, as reported         $        284  $        239
Deduct: Gain on sale of an idle
 manufacturing facility (1)               (14)            -
                                 ------------- -------------
Adjusted Earnings from
 continuing operations           $        270  $        239        13%
                                 ============= =============

Diluted earnings per share -
 continuing operations, as
 reported                        $       0.72  $       0.58
Deduct: Gain on sale of an idle
 manufacturing facility (1)             (0.04)            -
                                 ------------- -------------
Adjusted Diluted earnings per
 share - continuing operations   $       0.68  $       0.58        17%
                                 ============= =============
  (millions, except per share
            amounts)                    Year-to-Date
                                 ---------------------------
                                 Jan. 28, 2007 Jan. 29, 2006 % Change
                                 --------------------------- ---------

Earnings before interest and
 taxes, as reported              $        883  $        764
Deduct: Gain on sale of an idle
 manufacturing facility (1)               (23)            -
Deduct: Impact of change in
 inventory accounting method (2)            -           (13)
                                 ------------- -------------
Adjusted Earnings before
 interest and taxes              $        860  $        751        15%
                                 ------------- -------------

Interest, net, as reported       $         80  $         69
Add: Reduction in interest
 expense related to the
 favorable resolution of tax
 contingency (3)                            -            21
                                 ------------- -------------
Adjusted Interest, net           $         80  $         90
                                 ------------- -------------

Adjusted Earnings before taxes   $        780  $        661        18%
                                 ------------- -------------

Taxes on earnings, as reported   $        250  $        170
Deduct: Tax impact of gain on
 sale of an idle manufacturing
 facility (1)                              (9)            -
Deduct: Tax impact of change in
 inventory accounting method (2)            -            (5)
Add: Adjustment to tax expense
 related to the favorable
 resolution of tax contingency
 (3)                                        -            39
Deduct: Incremental tax expense
 associated with the
 repatriation of earnings under
 the AJCA (4)                               -            (8)
                                 ------------- -------------
Adjusted Taxes on earnings       $        241  $        196
                                 ------------- -------------
Adjusted effective income tax
 rate                                    30.9%         29.7%

Earnings from continuing
 operations, as reported         $        553  $        525
Deduct: Gain on sale of an idle
 manufacturing facility (1)               (14)            -
Deduct: Impact of change in
 inventory accounting method (2)            -            (8)
Deduct: Net adjustment to taxes
 and interest expense related to
 the favorable resolution of tax
 contingency (3)                            -           (60)
Add: Incremental tax expense
 associated with the
 repatriation of earnings under
 the AJCA (4)                               -             8
                                 ------------- -------------
Adjusted Earnings from
 continuing operations           $        539  $        465        16%
                                 ============= =============

Diluted earnings per share -
 continuing operations, as
 reported                        $       1.38  $       1.27
Deduct: Gain on sale of an idle
 manufacturing facility (1)             (0.04)            -
Deduct: Impact of change in
 inventory accounting method (2)            -         (0.02)
Deduct: Net adjustment to taxes
 and interest expense related to
 the favorable resolution of tax
 contingency (3)                            -         (0.14)
Add: Incremental tax expense
 associated with the
 repatriation of earnings under
 the AJCA (4)                               -          0.02
                                 ------------- -------------
Adjusted Diluted earnings per
 share - continuing operations*  $       1.35  $       1.12        21%
                                 ============= =============

* The sum of the individual per share amounts does not equal due to
 rounding.

Pro Forma Impact of Use of Proceeds from Sale of Businesses

In August 2006, the company completed the sale of its businesses
in the United Kingdom and Ireland for GBP 460 million or approximately
$870 million and announced that approximately $620 million of the net
proceeds would be used to repurchase shares. To improve the
comparability of results, the following table illustrates the pro
forma impact had 17 million shares been repurchased and eliminated
from shares outstanding in the prior year:

  (millions, except per share
            amounts)                   Second Quarter
                                 ---------------------------
                                 Jan. 28, 2007 Jan. 29, 2006 % Change
                                 --------------------------- ---------

Adjusted Earnings from
 continuing operations           $        270  $        239        13%
                                 ============= =============

Adjusted Diluted earnings per
 share - continuing operations   $       0.68  $       0.58        17%
                                 ============= =============

Weighted average shares
 outstanding - assuming
 dilution, as reported                    395           414
Deduct: Pro forma impact of
 shares repurchased                         -           (17)
                                 ------------- -------------
Pro forma weighted average
 shares outstanding - assuming
 dilution                                 395           397
                                 ============= =============


Pro forma Diluted earnings per
 share - continuing operations   $       0.68  $       0.60        13%
                                 ============= =============


  (millions, except per share
            amounts)                    Year-to-Date
                                 ---------------------------
                                 Jan. 28, 2007 Jan. 29, 2006 % Change
                                 --------------------------- ---------

Adjusted Earnings from
 continuing operations           $        539  $        465        16%
                                 ============= =============

Adjusted Diluted earnings per
 share - continuing operations   $       1.35  $       1.12        21%
                                 ============= =============

Weighted average shares
 outstanding - assuming
 dilution, as reported                    400           414
Deduct: Pro forma impact of
 shares repurchased                         -           (17)
                                 ------------- -------------
Pro forma weighted average
 shares outstanding - assuming
 dilution                                 400           397
                                 ============= =============


Pro forma Diluted earnings per
 share - continuing operations   $       1.35  $       1.17        15%
                                 ============= =============

Adjusted Pro Forma Fiscal 2006 Earnings Per Share From Continuing
Operations

The following table illustrates the reconciliation of reported
results to adjusted results excluding the impact of certain changes in
accounting method and other transactions, and the pro forma impact of
utilizing the net proceeds from the sale of the businesses in the
United Kingdom and Ireland to repurchase shares. In addition to items
that impacted Earnings from continuing operations in the six-month
period ended January 29, 2006, the following items impacted the full
year ended July 30, 2006:

(5) In the third and fourth quarter of fiscal 2006, the company
     recorded additional tax expense of $5 million associated with the
     repatriation of earnings under the AJCA. The total expense
     recognized for the full year was $13 million ($.03 per share).

(6) In the fourth quarter of fiscal 2006, the company recorded a non-
     cash tax benefit of $14 million ($.03 per share) from the
     anticipated use of higher levels of foreign tax credits, which
     could be utilized as a result of the sale of the company's United
     Kingdom and Ireland businesses.
                           (millions)                     Year Ended
                                                         July 30, 2006
                                                         -------------
Earnings from continuing operations, as reported         $        755
Deduct: Impact of change in inventory accounting method
         (2)                                                       (8)
Deduct: Net adjustment to taxes and interest expense
         related to the favorable resolution of tax
         contingency (3)                                          (60)
Add:    Incremental tax expense associated with the
         repatriation of earnings under the AJCA (5)               13
Deduct: Adjustment to tax expense related to the use of
         foreign tax credits (6)                                  (14)
                                                         -------------
Adjusted Earnings from continuing operations             $        686
                                                         =============

                                                          Year Ended
                                                         July 30, 2006
                                                         -------------
Diluted earnings per share - continuing operations, as
 reported                                                $       1.82
Deduct: Impact of change in inventory accounting method
         (2)                                                    (0.02)
Deduct: Net adjustment to taxes and interest expense
         related to the favorable resolution of tax
         contingency (3)                                        (0.14)
Add:    Incremental tax expense associated with the
         repatriation of earnings under the AJCA (5)             0.03
Deduct: Adjustment to tax expense related to the use of
         foreign tax credits (6)                                (0.03)
                                                         -------------
Adjusted Diluted earnings per share - continuing
 operations                                              $       1.66
                                                         =============

              (millions, except per share amounts)        Year Ended
                                                         July 30, 2006
                                                         -------------

Adjusted Earnings from continuing operations             $        686
                                                         =============

Adjusted Diluted earnings per share - continuing
 operations                                              $       1.66
                                                         =============

Weighted average shares outstanding - assuming dilution,
 as reported                                                      414
Deduct: Pro forma impact of shares repurchased                    (17)
                                                         -------------
Pro forma weighted average shares outstanding - assuming
 dilution                                                         397
                                                         =============


Pro forma Diluted earnings per share - continuing
 operations                                              $       1.73
                                                         =============
    CONTACT: Campbell Soup Company
             Anthony Sanzio (Media)
             (856) 968-4390
             or
             Leonard F. Griehs (Analysts)
             (856) 342-6428

    SOURCE: Campbell Soup Company