Sales did fall by 1 percent, but improved margins, largely due to productivity gains, helped Campbell top Wall Street's profit expectations by 2 cents per share.
Net income rose 63 percent to $113 million, or 33 cents per share, compared with $69 million, or 20 cents per share in the same period last year. Excluding one-time items from 2009, including a charge for nontangible assets, profit rose 7 percent.
Sales for the quarter were $1.52 billion, down 1 percent.
Fourth-quarter sales numbers for soup aren't a good indicator of the company's health because of the relatively small sample size for a period that covers most of the summer, according to Campbell. Sales of both condensed and ready-to-serve soups slid by 7 percent.
"In a challenging year, we delivered strong earnings growth, overcoming softer-than-expected sales, particularly in our U.S. soup business," said President and CEO Douglas Conant. "We had another year of strong cash flow performance, generating more than $1 billion in cash flow from operations. For the year, we expanded gross margins through supply chain productivity improvements and previously announced cost-savings initiatives."
When a $14 million gain from commodity hedging last year is removed, the company's gross margin was 40.6 percent, compared with 40.4 percent during the same period in 2009.
Bright spots included sales of beverages, including V8 vegetable juices, and the company's baking and snack lines.
Beverage sales rose 12 percent, Campbell said. And thanks to a more frugal consumer, broth sales were also up 3 percent as more people cooked at home.
Campbell also said it expects per-share profit to rise 5 percent to 7 percent in 2011. That's in line with its long-term targets. But the company is citing challenging conditions for expected sales growth of 2 percent to 3 percent, just below those targets.
For the full fiscal year, Campbell reported earnings of $844 million or $2.42 per share, up from $736 million or $2.05 per share in fiscal 2009. Excluding one-time items, the full-year profit was $862 million, or $2.47 per share, up from $794 million or $2.21 per share.
The full year sales were $7.7 billion, up 1 percent from the $7.6 billion it brought in during the prior year.
