July 22 (Reuters) - Campbell Soup Co raised its full-year profit forecast as savings from its cost-cutting program came in earlier than expected.
The maker of Pepperidge Farm cookies and Goldfish crackers has been reducing costs through jobs cuts and spending less on travel and consulting.
Campbell on Wednesday said it expects to save $75 million in the fiscal year 2015, ending Aug. 2, and raised its earnings per share forecast for the year to $2.43-$2.46 from $2.32-$2.38.
The company now expects annual savings of $250 million by 2018, up from $200 million expected earlier.
Campbell, however, reduced its long-term organic sales growth forecast to 1-3 percent from 3-4 percent to reflect “current conditions in the food industry.” The company’s organic sales have not increased for two quarters now.
Packaged food companies have struggled to grow as consumers in developed markets shift away from processed foods to fresher, healthier items.
Campbell said it would reorganize its business in January to shift its “center of gravity” - a reference to the troubled soup business.
Increasing competition from store brands, private labels and niche producers such as Pacific of Oregon, Harris Foods Co and Amy’s Kitchen Inc, have hurt the business for United States’ largest soup maker.
Campbell, bought salsa maker Garden Fresh Gourmet for $231 million, to expand its packaged fresh business last month.
The company’s shares were up 2.6 percent at $48.69 in morning trading on the New York Stock Exchange. (Reporting by Yashaswini Swamynathan in Bengaluru)