Campell Soup's profits rise while Americans stockpile food amid coronavirus fears

4 March 2020, 20:21

Campbell Soup Company's profits and sales have enjoyed a surprise increase
Campbell Soup Company's profits and sales have enjoyed a surprise increase. Picture: PA
Nick Hardinges

By Nick Hardinges

Campbell's Soup has enjoyed an unexpected rise in profits and sales while Americans stockpile canned food amid coronavirus fears.

The iconic company - which has been selling its famous products in US supermarkets for more than 150 years - raised its profit forecast on Wednesday, defying Wall Street estimates.

Improved demands in the firm's second quarter, alongside a ramped up marketing campaign and the introduction of new recipes, saw shares rise by four per cent.

Meanwhile, sales improved by one per cent and shares were up by five cents on a previous forecast.

It comes as Americans across the country have begun hoarding food in preparation for being quarantined due to the outbreak of the Covid-19 coronavirus.

Campbell Soup Company - which also produces sauces, snacks, and even bread - said it was ordering more ingredients to meet the growing demand from retailers.

The firm's chief executive Mark Clouse told Reuters on Tuesday that a number of retail customers had begun increasing their orders.

“We’re working very closely with folks to make sure that we keep them in stock," he said.

However, Mr Clouse added that prior to this weekend he "had not seen much" higher demand for his products, despite the outbreak of the Covid-19 disease. But, as a precautionary measure, the company has begun making a record of ingredients that would normally be stockpiled in natural disasters, including its canned soups, snacks and Prego pasta sauces.

"There’s no question that we’re seeing some uptick (in demand) - it’s just hard for me yet to know the level of sustained need," Mr Clouse said.

Americans have been urged to stockpile non-perishable food in case they need to self-isolate
Americans have been urged to stockpile non-perishable food in case they need to self-isolate. Picture: PA

In a forward-looking statement, the soup company suggested something like the coronavirus could affect the company's supply chain and operations because a fluctuation "in the supply of and inflation in energy and raw and packaging materials cost" could impact Campbell's products.

However, Mr Clouse added that his business is far less exposed to disruptions in global supply chains than it was before he took over in late-2018.

"Only about 10 per cent of our total ingredients come from outside of North America, with China under two per cent.”

Some US authorities have encouraged people to stock up on non-perishable food, medicines and sanitary goods in case they need to self-isolate.

Michael Lavery, an analyst for US-based investment bank and financial services company Piper Sandler, said: “Anticipation of disruption is driving stockpiling now. 

“We believe from anecdotes that consumers are already stocking up on non-perishable food, as grocery stores see surges in traffic and larger baskets.”

Last year, the soup company stripped down several of its units in a bid to streamline the business. Doing so has seen the firm's net earnings jump from a $59 million loss last year, to a $1.21 billion profit this year.

More Latest News

See more More Latest News

Drivers queuing in Dover on Friday morning

Holidaymakers hit with 2-hour Dover ferry waits amid strong winds, as 2.6m hit the roads for Good Friday getaway

The attack happened on a train in south London

Teenager charged with attempted murder after south London train stabbing, with victim still in critical condition

Mother Natalie Pinnell

Mother left in tears after daughter with complex needs 'erased' from school photo

Amber Rudd and Mary Beard have both been nominated to the Garrick Club

Amber Rudd and Mary Beard among seven women nominated for membership of all-male Garrick Club

Exclusive
Anneliese Dodds said Labour would make sure local people have 'skin in the game' with tackling inequality

'Rebuild has to start from ground up,' Labour's Anneliese Dodds says, and 'local people must have skin in the game'

Mohamed Mansour has been awarded a knighthood

Conservatives accused of 'cronyism' after donor who gave £5 million awarded knighthood in surprise honours list

Exclusive
Justin Welby recalled his experience of coping with his father's drinking as a teenager.

‘It was utterly isolating’: Archbishop of Canterbury recalls harrowing childhood with alcoholic father

More than 2 million drivers are set to hit the road on Good Friday.

Easter Carmageddon: Over two million drivers to hit the road on Good Friday after Storm Nelson travel chaos

Michael Gove has slammed the water firm as a 'disgrace'.

Thames Water bosses branded a ‘disgrace’ as Michael Gove tells firm ‘not to punish consumers’ for its failings

South Africa Bus Crash

Girl, 8, the sole survivor as 45 die in bus crash off South Africa bridge

A spokesman has denied reports the sausage dog could be banned.

The wurst news is over: Germany denies claims of sausage dog ban

Israel Palestinians Britain Aid

UN top court orders Israel to open more land crossings into Gaza

Greece Confidence Vote

Greece’s government survives no-confidence motion called over rail disaster

A council has had to apologise following the incident.

Fury as parents offered version of school class photo without complex needs pupils

Conjoined twin who shot to fame with sister on The Oprah Winfrey Show marries army veteran in private ceremony

Conjoined twin who shot to fame with sister on The Oprah Winfrey Show marries army veteran in private ceremony

Israel Palestinians UN Security Council

Russia ‘abolishes’ monitoring of sanctions on North Korea with UN veto