Shares of the US-based company Campbell Soup Co. (NYSE:CPB) have dropped after the company released its third-quarter financial results for fiscal 2018, on Friday.
Although the company reports increase in comparable sales, up 15% to $2.1 billion USD, expenses related to Campell Soup have also increased.
Marketing and selling expenses increased by 9% to $232 million and administrative expenses also increased by 15% to $163 million, compared to that of the previous year.
Gross margin for the company decreased from 35.9% to 29.1%. The adjusted net loss for Campbell Soup increased to $308 million, compared to $305 million during the third quarter of 2017.
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According to Campbell Soup’s Chief Financial Officer, Anthony DiSilvestro, the company’s “organic sales in the quarter were stable in this difficult environment,” but the “gross margin performance was below [the company’s] expectations.”
It was also announced on Friday that Campbell Soup President and CEO Denise M. Morrison has decided to retire from her position at the company. Morrison had been a part of the company for over 15 years.
Morrison will be replaced by Keith McLoughlin, as an interim CEO, who has been a member of the Board of Directors since 2016.
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According to a recent article from Bloomberg, Morrison had held the position of CEO for seven years, and no reason was given by Campbell Soup as to why she decided to retire.
Changes in consumer tastes have negatively affected companies such as Campell Soup, as there has been pressure to “move away from processed food toward healthier options,” which Bloomberg has said is partly to blame for the decline in business.
After the announcement was made, the share value of Campbell Soup fell over 10% on Friday. The company opened at a share value of $34.93 and, as of 12:15 pm EDT, had reached a high of $35.39 and a low of $34.35.
Comparatively, the company closed at a share value of $39.22 on Friday.
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