Company Revises Fiscal 2015 Guidance: Increases Adjusted EBIT and EPS

Updates Long-term Growth Targets

CAMDEN, N.J.–(BUSINESS WIRE)–Jul. 22, 2015–
Campbell Soup Company (NYSE:CPB) President and Chief Executive
Officer Denise Morrison and other senior leaders will meet with
investors today to provide an update on key business strategies and
outline important actions the company is taking to improve its financial
performance.

In her presentation, Morrison will discuss Campbell’s key strategic
imperatives, including plans to be more transparent about how its foods
and drinks are made to build greater consumer trust; and to increase the
company’s focus on faster-growing categories and regions, such as health
and well-being, packaged fresh and developing markets. Management will
also provide an update on its ongoing enterprise redesign and cost
savings initiatives.

Campbell executives will outline plans for the company’s three new
divisions, each with a clear portfolio role:

• Americas Simple Meals and Beverages, the largest division and the
  company’s economic engine, will be managed for moderate growth and
  margin expansion and is focused on responding to consumer shifts with
  changes in its core portfolio and a more focused approach to
  innovation.
• Global Biscuits and Snacks, which unifies the Pepperidge Farm,
  Arnott’s and Kelsen businesses into a fully integrated biscuits and
  snacks portfolio, is focused on strengthening its core markets and
  expanding in developing markets.
• Campbell Fresh, which now combines recently-acquired Garden Fresh
  Gourmet with the Bolthouse Farms portfolio and Campbell’s
  retail refrigerated soups, is focused on building scale and
  accelerating growth in rapidly expanding packaged fresh categories as
  the company strengthens its health and well-being platform.

The company announced that it will change its reporting segments
beginning in the first-quarter of fiscal 2016 to reflect its new
divisional structure.

Cost Reduction Initiatives

Campbell will provide additional details on its previously announced
enterprise redesign and cost reduction initiatives.

Campbell is achieving savings earlier than anticipated based on
reductions in headcount, travel, consulting and non-working marketing.
The company now expects approximately $75 million in savings from these
cost reduction initiatives in fiscal 2015. As a result, the company is
increasing its annual savings target from $200 million to $250 million,
which it expects to achieve by the close of fiscal 2018. As previously
disclosed, the company expects costs of $250-$325 million related to
these initiatives through fiscal 2018.

Revises Fiscal 2015 Guidance for Continuing Operations

Campbell revised its previous full-year guidance for fiscal 2015, which
ends Aug. 2, 2015.

Consistent with previous sales guidance, the company expects sales to
decline by 1 percent, reflecting the negative impact of currency
translation. Reflecting favorable gross margin performance and
earlier-than-expected benefits from the previously announced cost
reduction initiatives, Campbell now expects adjusted EBIT to decline -2
to -1 percent, compared to the previous guidance of being at the
favorable end of the -7 to -5 percent range. The company expects
adjusted EPS to be in the range of -1 to 0 percent, or $2.43 to $2.46
per share, compared to the previous guidance of being at the favorable
end of the -5 to -3 percent range or $2.32 to $2.38 per share.

This guidance is calculated on an adjusted base, which excludes the
impact of a 53^rd week in fiscal 2014 and includes an
estimated 2-point negative impact from currency translation across
sales, EBIT and EPS in fiscal 2015.

A detailed reconciliation of adjusted financial information to the
reported information is included at the end of this news release.

Revised Long-Term Growth Targets

Campbell is revising its long-term targets to reflect the current
conditions in the food industry. The company’s new long-term target for
organic sales growth is 1 to 3 percent, compared to the previous target
of 3 to 4 percent. Long-term earnings growth targets, which now exclude
currency translation, remain unchanged with adjusted EBIT growing 4 to 6
percent and adjusted EPS growing 5 to 7 percent.

Campbell plans to provide fiscal 2016 guidance for net sales, adjusted
EBIT and adjusted EPS when it reports fourth-quarter fiscal 2015 results
Sept. 3, 2015.

A webcast of the meeting will be available at investor.campbellsoupcompany.com
beginning at 12:30 p.m. Eastern Daylight Time today. A replay and
transcript will be available after the event.

About Campbell Soup Company

Campbell (NYSE:CPB) is driven and inspired by our Purpose, “Real food
that matters for life’s moments.” The company makes a range of
high-quality soups and simple meals, beverages, snacks and packaged
fresh foods. For generations, people have trusted Campbell to provide
authentic, flavorful and readily available foods and beverages that
connect them to each other, to warm memories, and to what’s important
today. Led by its iconic Campbell’s brand, the company’s
portfolio includes Pepperidge Farm, Bolthouse Farms, Arnott’s,
V8, Swanson, Pace, Prego, Plum, Royal Dansk,
Kjeldsens and Garden Fresh Gourmet. Founded in 1869,
Campbell has a heritage of giving back and acting as a good steward of
the planet’s natural resources. The company is a member of the Standard
& Poor’s 500 and the Dow Jones Sustainability Indexes. For more
information, visit www.campbellsoupcompany.com
or follow company news on Twitter via @CampbellSoupCo.

Forward-Looking Statements

This release contains “forward-looking statements.” Forward-looking
statements can be identified by words such as “anticipates,” “intends,”
“plans,” “believes,” “estimates,” “expects” and similar references to
future periods. Examples of forward-looking statements include, but are
not limited to, statements we make on guidance for 2015, on our
long-term growth rates, on our cost-saving initiatives, and on our new
enterprise and management structure. Forward-looking statements are
based on our current expectations and assumptions regarding our
business, our industry and other future conditions. Forward-looking
statements are subject to inherent uncertainties, risks and changes in
circumstances that are difficult to predict. Our actual results may
differ materially from those contemplated by the forward-looking
statements due to factors such as our ability to manage organizational
change effectively; our ability to realize projected benefits and cost
savings from the new structure and our cost-savings initiatives; the
impact of strong competitive responses to our marketing strategies;
risks associated with trade and consumer acceptance of our new and
improved products; the effectiveness of our promotional programs; the
impact of portfolio changes, and the other factors described in “Risk
Factors” in the company’s most recent Form 10-K and in subsequent SEC
filings. We undertake no obligation to update these statements to
reflect new information or future events.

Reconciliation of GAAP and Non-GAAP Financial Measures Fiscal Year
Ended August 3, 2014

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 financial information excluding certain
transactions not considered to be part of the ongoing business improves
the comparability of year-to-year results. The following tables
reconcile financial information, presented in accordance with GAAP, to
financial information excluding certain items. Fiscal 2014 included 53
weeks. Consequently, the company believes that investors may be able to
better understand its fiscal 2015 performance excluding certain
transactions and the estimated impact of the 53^rd week. In
establishing guidance for fiscal 2015, the adjusted fiscal 2014 results
are revised to exclude the estimated impact of the 53^rd week
below:

*The sum of the individual per share amounts may not add due to rounding.

(1) In fiscal 2014, the company implemented initiatives to streamline
its salaried workforce in North America and its workforce in the Asia
Pacific region; restructure manufacturing and streamline operations for
its soup and broth business in China; improve supply chain efficiency in
Australia; and reduce overhead across the organization. In fiscal 2014,
the company recorded pre-tax restructuring charges of $54 million ($33
million after tax, or $.10 per share, in earnings from continuing
operations attributable to Campbell Soup Company) associated with the
2014 initiatives. In fiscal 2013, the company implemented initiatives to
improve its U.S. supply chain cost structure and increase asset
utilization across its U.S. thermal plant network; expand access to
manufacturing and distribution capabilities in Mexico; improve its
Pepperidge Farm bakery supply chain cost structure; and reduce overhead
in North America. In fiscal 2014, the company recorded pre-tax
restructuring charges of $1 million and restructuring-related costs of
$3 million in Cost of products sold (aggregate impact of $3 million
after tax or $.01 per share on earnings from continuing operations)
associated with the 2013 initiatives.

(2) In fiscal 2014, the company recognized pension settlement charges
associated with a U.S. pension plan. The settlements resulted from the
level of lump sum distributions from the plan’s assets in 2014,
primarily due to the closure of the facility in Sacramento, California.
In fiscal 2014, the company recognized pre-tax pension settlement
charges of $22 million ($14 million after tax, or $.04 per share, in
earnings from continuing operations).

(3) On October 28, 2013, the company completed the sale of its simple
meals business in Europe. The results of the business were reported as
discontinued operations. In fiscal 2014, the company recorded a loss of
$9 million ($6 million after tax, or $.02 per share) on foreign exchange
forward contracts used to hedge the proceeds from the sale of the
European simple meals business. The loss was included in earnings from
continuing operations. In addition, the company recorded tax expense of
$7 million ($.02 per share) in earnings from continuing operations
associated with the sale.

View source version on businesswire.com: https://www.businesswire.com/news/home/20150722005616/en/

Source: Campbell Soup Company

Campbell Soup Company
INVESTOR CONTACT:
Jennifer
Driscoll, 856-342-6081
[email protected]
or
MEDIA
CONTACT:
Carla Burigatto, 856-342-3737
[email protected]

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