Campbell Soup Company (NYSE:CPB) announced today that it has entered into commercial arrangements with Grupo Jumex and Conservas La Costeña that will expand the company’s access to manufacturing and distribution capabilities in Mexico for its beverages, soups, broths and sauces. Grupo Jumex, the largest producer of fruit juices and nectars in Mexico, will manufacture and distribute Campbell’s “V8” portfolio throughout the Mexican market. Conservas La Costeña, one of the largest producers of prepared foods in the country, will manufacture and distribute “Campbell’s” soups, broths and Italian sauces. Under the terms of its agreements with each partner, Campbell will retain responsibility for consumer marketing, product research and new product development. Financial terms were not disclosed. Denise Morrison, Campbell’s President and Chief Executive Officer, said, “We are delighted to be working with Grupo Jumex and Conservas La Costeña – outstanding companies with long and distinguished histories – in a market that offers Campbell exciting avenues for growth. Our arrangements with these new partners will increase our access to customers and enable us to reach new consumers for our products. We believe that they will redefine the scope of our business opportunities in Mexico.” Mexico is a growing market with more than 112 million people. Annual sales of non-carbonated beverages in Mexico are at $3.5 billion today, and are currently growing at approximately 6 percent per year. Campbell’s beverage business constitutes the largest part of the company’s portfolio in Mexico and has grown steadily over the past several years. Currently, Campbell employs approximately 330 people in Mexico. As a result of entering into these agreements, Campbell will close its plant in Villagrán, Mexico, and eliminate approximately 260 positions. The company plans to retain approximately 70 positions in R&D, sales, supply chain, marketing and general management. Production from the Villagrán facility will be transitioned to Grupo Jumex and Conservas La Costeña facilities in phases through September 2013. Campbell anticipates that it will record a restructuring charge of $9 million ($6 million after tax) related to this initiative, most of which will be incurred in the second quarter of fiscal 2013.
“We would like to recognize our employees in Mexico for their significant contributions to our business. Campbell is committed to helping them work through this transition,” said Humberto Ibarzábal, Campbell’s President-Latin America.About Campbell Soup Company Campbell Soup Company is a manufacturer and marketer of high-quality foods and simple meals, including soup and sauces, baked snacks and healthy beverages. Founded in 1869, the company has a portfolio of market-leading brands, including "Campbell's," "Pepperidge Farm," "Arnott's," "V8" and "Bolthouse Farms." Through its corporate social responsibility program, the company strives to make a positive impact in the workplace, in the marketplace and in the communities in which it operates. Campbell is a member of the Standard & Poor's 500 and the Dow Jones Sustainability Indexes. For more information, visit www.campbellsoupcompany.com. Forward-Looking Statements This release contains “forward-looking statements” that reflect the company’s current expectations about the impact of its future plans and performance on sales, earnings, and margins. These forward-looking statements rely on a number of assumptions and estimates that could be inaccurate and which are subject to risks and uncertainties. The factors that could cause the company’s actual results to vary materially from those anticipated or expressed in any forward-looking statement include (1) the impact of strong competitive responses to the company’s efforts to leverage its brand power in the market; (2) the risks associated with trade and consumer acceptance of the company’s initiatives; (3) the company’s ability to realize projected cost savings and benefits; (4) the company’s ability to manage changes to its business processes; (5) the increased significance of certain of the company’s key trade customers; (6) the impact of fluctuations in the supply or costs of energy and raw and packaging materials; (7) the impact of portfolio changes, including the Bolthouse Farms acquisition; (8) the uncertainties of litigation; (9) the impact of changes in currency exchange rates, tax rates, interest rates, debt and equity markets, inflation rates, economic conditions and other external factors; (10) the impact of unforeseen business disruptions in one or more of the company’s markets due to political instability, civil disobedience, armed hostilities, natural disasters or other calamities; and (11) other factors described in the company’s most recent Form 10-K and subsequent Securities and Exchange Commission filings. The company disclaims any obligation or intent to update the forward-looking statements in order to reflect events or circumstances after the date of this release.