(RTTNews) - Campbell Soup Company (CPB) said the company had a strong recovery across the business in the third quarter with high-single-digit sales growth driven by sustained consumer demand for its brands and significantly improved supply. Looking forward, the company raised its fiscal 2022 net sales outlook reflecting strong year-to-date performance. However, the company reaffirmed prior adjusted EBIT and adjusted EPS guidance reflecting the on-going inflation-driven margin pressure.
Third quarter adjusted EPS increased 37% year-on-year to $0.70. On average, 16 analysts polled by Thomson Reuters expected the company to report profit per share of $0.61, for the quarter. Analysts' estimates typically exclude special items.
Adjusted EBIT increased 23% to $321 million primarily due to improved adjusted gross margin performance, lower marketing and selling expenses, partially offset by sales volume declines and lower adjusted other income. Adjusted gross margin increased 90 basis points to 31.5% due to inflation-driven pricing actions, supply chain productivity improvements and cost savings initiatives.
Reported EPS from continuing operations increased 15% to $0.62 from $0.54, prior year. Net earnings attributable to Campbell Soup increased to $188 million from $160 million.
Net sales increased 7% year-on-year to $2.13 billion. Organic net sales increased 9%, for the quarter. Inflation-driven pricing and sales allowances of 11% more than offset volume declines of 3%. Analysts on average had estimated $2.05 billion in revenue.
For fiscal 2022, the company now expects: net sales to rise 0% to 1%, while organic net sales is projected to increase in a range of 1% to 2%.
The company remains on track to deliver savings of $1 billion by the end of fiscal 2025.
Shares of Campbell Soup Company were up 3% in pre-market trade on Wednesday.
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