Campbell Sees Retail Demand for Soup Rise Amid Virus

(Bloomberg) -- Campbell Soup Co. is seeing an uptick in demand for some of its staple products during the spread of coronavirus, Chief Executive Officer Mark Clouse said in an interview Wednesday.

The company will stay in touch with their retail partners to see whether consumers maintain the behavior, he said, calling it the “early days” of the trend. But given the rising purchases, the iconic soup maker last week decided to increase output of the products like canned soups, snacks and Spaghetti O’s -- which often see a boost from inclement weather that keeps people indoors.

“We’re doing everything we can to keep availability up,” Clouse said, adding that they are not making any changes to pricing. He added that the situation is dynamic but maintaining supply is manageable at this point. “Part of it is remaining nimble and really close to be in best position.”

While the company gets about 90% of its ingredients from North America, Clouse said that about 2% comes from China, including some packaging and apple juice concentrate. The company has been able to find alternative sources for those supplies.

”It’s very important to stay close to customers on what they’re seeing, and working side by side with them,” Clouse said, referring to the retailers that stock Campbell’s goods.

Data from market research company Nielsen show a rise in consumer spending in recent weeks for some food and health products as consumers prepare for the possibility of staying home for extended periods.

Campbell has also limited nonessential travel and stopped travel to high-risk areas like Italy and China, Clouse said. All employees are encouraged to stay home if they are sick, including those in factories, and the canned-soup maker has paid time off so they can recover and seek medical care if necessary.

The company’s shares rose as much as 8.7% on Wednesday -- the most intraday in six months. The stock has advance about 4% this year, compared with a decline for the S&P 500 Index.

Campbell earlier reported quarterly results, raising its outlook for earnings per share, excluding some items, to a range of $2.55 to $2.60 -- an increase of 5 cents from the previous projection.

To contact the reporter on this story: Deena Shanker in New York at dshanker@bloomberg.net

To contact the editors responsible for this story: Anne Cronin at acronin14@bloomberg.net, Sally Bakewell, Jonathan Roeder

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