Campbell's soup sales cool

Campbell’s soup sales have been less than savoury.

The company announced Monday it will cut its annual forecast as a result of declining soup sales. It expects sales from continuing operations to grow about 3% in the current fiscal year, down from a previously predicted 5%.

While U.S. Simple Meals saw a 7% increase in sales, condensed soup sales decreased 3%, and ready-to-serve soups also decreased by 1%.

Denise Morrison, Campbell’s president and CEO, said she was disappointed the company’s plans didn’t result in stronger results in the soup category.

“Despite an increase in the frequency of our promotional activity in the third quarter, we did not realize the anticipated lifts in a challenging consumer environment,” she said in a release.

Declining soup sales aren’t a surprise for the company. In February Campbell’s reported consumer purchase for its soup division were down 1%, with consumers opting instead to buy broths — a result of “an increase in homemade soup behavior” said Morrison.

The trend continued to ring true this quarter, as Campbell’s broth sales increased by 14%.

Despite its challenges with its trademark soup products, Campbell's also saw a sales increase of 25% in U.S. sauces. Morrison attributed this to the success of its brands Prego, Pace and Campbell’s’ skillet and slow cooker dinner sauces.

“While we are not satisfied with our sales performance, we remain confident that we are pursuing the right strategy to reshape Campbell's and deliver sustainable, profitable, net sales growth.”