U.S. Simple Meals operating earnings increased 10 percent to $191 million, compared with $174 million in the prior-year period. Benefits from higher selling prices, productivity improvements and lower marketing expenses were partly offset by volume declines and cost inflation. The increase in operating earnings was driven by earnings gains in U.S. Soup, partly offset by a decline in U.S. Sauces.For the first half, sales for U.S. Simple Meals increased 2 percent to $1.729 billion, driven by higher selling prices.
- Volume and mix added 6 percent
- Price and sales allowances added 1 percent
- Increased promotional spending subtracted 1 percent
- Currency added 1 percent
- Sales of “Pepperidge Farm” products increased, primarily driven by volume gains, partially offset by increased promotional spending.
- In cookies and crackers, sales increases were driven by strong gains in “Goldfish” snack crackers and the national launch of “Jingos!” adult savory crackers, as well as improved performance in cookies, which benefitted from a successful holiday period.
- Sales of fresh bakery products increased versus the prior year, driven by volume gains across most of the portfolio.
- Excluding the favorable impact of currency, sales at Arnott’s increased, driven by growth in Australia and excellent gains in Indonesia. Sales growth in Australia was driven across all categories: savory crackers, chocolate cookies and sweet varieties.