News briefs: Financial results

By Karen Willmer

- Last updated on GMT

Related tags Percentage point Chief executive officer Executive officer Krispy kreme

Campbell and General Mills report sales growth, but the future does
not look sweet for Krispy Kreme.

Campbellreports quarterly sales growth of 10 per cent ​Campbell Soup Company reported sales rose 10 per cent in the financial fourth quarter ended 29 July, and 7 per cent for the full year. Operating earnings fell by 7 per cent during the quarter, but registered an 11 per cent growth for the year. Operating margins before interest and taxes fell by 1.5 percentage points during the quarter to 8.1 percent, compared to the same period last year. For the financial year, the company's margins increased by 0.7 percentage points to 16.4 per cent. Douglas Conant, Campbell's president and chief executive officer, expects continuing operations to deliver sales growth in excess of a long-term target range of between 3 and 4 per cent for fiscal 2008, and operating income of between 7 and 9 per cent. The growth forecast is due in part to an extra week of sales compared to the previous fiscal year. For the previous financial year Conant said the sales performance occurred across all operating segments, despite flat US soup sales. The company also spent more on marketing and its supply chain. During the year the company prepared for major product introductions in Russia and China, the world's two largest soup markets with the highest growth potential. In its core US soup business, Campbell expanded its distribution system and dealt with the increased volume requirements of a growing beverage business. General Mills boosts sales on whole wheat line ​General Mills reported sales growth for the quarter ended 26 August exceeded expectations, with its whole grain line of "Big G" branded cereals registering a 5 per cent increase. The company had previously forecast a long-term target of "low single-digit" growth. In a trading update, the company said the sales growth reflected the initial introduction of several new cereal products, and pricing and packaging size changes on existing brands. The company will release a full report on its financial first quarter 19 September. Healthy eating slims Krispy Kreme's profits ​Krispy Kreme reported a revenue decline of 7.5 per cent to $104.1m for the second quarter ended July 29 2007, compared to $112.5m in the second quarter last year. Operating loss for the quarter was $24.3m, compared to 2.6m in the same period last year, mainly due to a decline in shop sales. "After several quarters of progress on our turnaround, second quarter results did not meet our expectations,"​ said Krispy Kreme's president and chief executive officer, Daryl Brewster. "We are taking steps to transform the company and improve its performance." ​ The company said it plans to take several steps in a bid to improve the state of the company including closing or improving underperforming chops, continuing international expansion and reducing costs. The cost reduction plans include divesting a factory in the KK supply chain, the company said. "The company's strategy is to focus on the development of small retail stored in a limited number of geographic markets where the company believes it can achieve market scale,"​ Krispy Kreme said.

Related topics Markets

Related news

Show more