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Campbell Soup CompanyFellow Shareholders,Growth It has been elusive for years, as the entirefood industry grapples with the seismicshifts that have altered the consumer,food and retail landscapes.The drive to deliver sustainable, profitabletop-line growth has been a consistenttheme during my tenure as Campbell’s CEO.Our growth strategy has been focused ontwo critical areas: strengthening our corebusiness and expanding into faster-growingspaces to diversify our portfolio.Both were necessities to address theseseismic shifts: the massive changes indemographics; the evolving consumerpreferences toward health and well-being,centered on fresh and real food;technological advancements reshapingthe consumer shopping experience; andtumultuous socio-economic forces. Theseshifts have not only accelerated andconverged, they have essentially resetconsumer behavior. In this environment,companies and brands must differentiatethemselves or risk extinction.Over the last six years, we have madesignificant progress on transformingCampbell’s portfolio toward faster-growingspaces, particularly health and well-being.Our commitment to health and well-beingis unwavering. We chose this path becausewe recognized the dramatic changestaking place in our industry and that realand healthier food was better for ourconsumers and better for our business.Let me state it clearly and unambiguously:Our ultimate goal is to “Be the leadinghealth and well-being food company.”2017 Annual Report1 Campbell Place, Camden, NJ 08103-1799investor.campbellsoupcompany.comWhen people look for something real toeat and something that tastes good, theyare going to look for the food Campbellmakes. We chose this path not because itis expedient, but because we believe itrepresents the future of the food industryand that it will lead to differentiatedperformance for our shareholders.Campbell Soup Company2017 ANNUAL REPORTDenise M. MorrisonPresident and Chief Executive Officer
OUR GROWTH AGENDAAND FOUR STRATEGIC IMPERATIVESARE THE ROADMAPIt is not enough to simply say what we aspire to be. We needto tell you how we will achieve it. Our growth agenda, withour purpose, Real food that matters for life’s moments, asa North Star, informs everything we do — from resourceallocations to external development. Our four strategicimperatives provide a blueprint to become the leadinghealth and well-being food company and to deliverimproved sales growth.1. Building Greater Trustwith Consumers Through Real Food,Transparency and SustainabilityOur purpose continues to be the single most importantchange in our company’s culture in the last few years. It hasfundamentally altered the way we think, talk and act aboutour food.Our purpose has led us to take principled positions aboutthe most pressing issues facing the food industry, includingtransparency. At times, we have had philosophical differenceswith many of our peers and our trade association onimportant issues. As a result, we intend to withdraw fromthe Grocery Manufacturers Association at the end of 2017.This was not a financial decision. It was driven by ourpurpose and our principles.As we strive to be the most transparent food company in theworld, Campbell is partnering with the Sage Project to raisethe bar on food transparency. Combining technology withdesign, the Sage Project is creating online food labels forthe digital world, making information about calories,nutrition, ingredients and attributes open, accessible andeasy for consumers to understand. Campbell is embracingthe platform because we believe it delivers the informationconsumers are increasingly demanding.These efforts complement our planned ongoing investmentof 50 million over the next several years to make the kindof food that consumers are seeking and that we are proud toserve at our own tables. We are making steady progresstoward our commitment to remove artificial colors andflavors from our food, while increasing the use of vegetablesand whole grains and using chicken with no antibiotics. Wehave also completed our work to remove BPA from thelining of our soup cans in the U.S. and Canada.2. Accelerating Digital Marketingand E-Commerce EffortsConsumer options for how and where they buy groceriesare changing rapidly. Shoppers today have immediateaccess to pricing, product information and reviews, literallyin the palm of their hand. E-commerce is a series of tools,technologies and behaviors that, over time, build consumerexpectations of convenience. It happened in entertainment.It happened in apparel. And now it is happening in food.Today, the percentage of food sold online is in the low singledigits. By 2021, we project online grocery sales to reach 66billion annually in the U.S.1 Over the next five years, weexpect to generate 300 million of sales in this space.To accelerate our digital and e-commerce efforts, we arebuilding an e-commerce unit in North America to deliver theproducts and services our consumers demand and to drivegrowth, while working to scale our digital marketing capabilities.We also expect to partner with leading e-commerce companies.For example, Campbell invested 10 million and formed astrategic partnership with online meal kit company Chef’dto test new concepts for fresh, healthy recipes and tointegrate our products into their popular meal kits. Moreimportantly, we will gain insights from their data and analyticsand participate firsthand in emerging e-commerce models.To compete and thrive in this environment, we need toenhance our distribution capabilities to meet customer andconsumer needs today and in the future. That is why we areinvesting in a network of distribution centers to create a moreflexible distribution system to serve our e-commerce channels.1Proprietary Campbell Estimate Defining the future of food requiresdifferent approaches and an ecosystemof innovative partners. A prime exampleis the partnership we announced withChef’d, a leading meal kit marketplace.They possess deep competencies inconsumer insights, the shopper’s pathto purchase, digital marketing andanalytics, and fulfillment capabilities.Campbell will gain valuable knowledgein emerging e-commerce trends andbusiness models.Campbell Soup Company 4
FiscalFiscal20172017ResultsResultsAsAsI earof ThisThisyear,year,salessalesdecreaseddecreased1 percent1 percentto to 7.890 7.890billionbilliondrivendrivenbybya a1 1percentpercentdecline*decline*in )(EPS)of of 2.89. 2.89.AdjustedAdjustedEPSEPSincreasedincreased3 3percentpercentto to 3.04 3.04perpershare,share,comparedcomparedwithwith 2.94 2.94perpersharesharea yeara llCampbellis spiritspiritof ofa smalla ourcesresourcesof ofa largea tbestof ofbigbigandandsmallsmallto todeliverdelivervaluevalueto iftsshiftsI firstI e.settle.TheyTheycontinuedcontinuedto hosecompaniescompanieswhowhocannotcannot——or orchoosechoosenotnotto toperformanceperformancein inlinelinewithwiththethecategoriescategoriesin unningoutoutof oftime,time,andandwillwillsoonsoonbebeoutoutof rswhowhoassumedassumedTVTVwaswasjustjusta onalexecutionalissuesissuesin nessbusinesswillwillreturnreturnto toprofitableprofitablegrowthgrowthin inmaymayveryverywellwellfacefacea similara similarfate.fate.CampbellCampbellis islisteninglisteningto spondingrespondingto withwiththetheprogressprogressof gsprogramprogramwewelaunchedlaunchedin in2015.2015.AsAsof ofthetheendendof ofIn Inclosing,closing,I wantI wantto tothankthankourourBoardBoardof fiscal2017,2017,weweachievedachieved 325 325millionmillionin rourshareholders.shareholders.whichwhichis isa ayearyearaheadaheadof I amI odfoodcompanycompanywillwillleadleadto to 150 150millionmillionandandnownowexpectexpectto todeliverdeliver 450 450millionmillionin savingssavingsbybythetheendendof ommittedto lyandandreinvestingreinvestinga portiona portionof ethebusinessbusinessin infiscalfiscal20182018to ermlong-termgrowth.growth.* These* Theseamountsamountsare areadjustedadjustedfor redto beto partbe partof theof theongoingongoingbusiness.business.ForFora reconciliationa reconciliationof non-GAAPof pagepage8 hairman’sChairman’sMessageMessageIn mpanyCompanycontinuedcontinuedto toliveliveintointoitsitspurposepurpose– Real– fe’smomentsmoments– lgoalto to“Be“Bethetheleadingleading healthhealth andand well-beingwell-being foodfoodcompany.”company.”However,However,it wasit wasa challenginga challengingyear.year. edto ndourourongoingongoingefforteffortto toexpandexpandourourpresencepresencein inthethefaster-growing,faster-growing, on-trendon-trend of ableto todeliverdeliveranotheranotheryearyearof harlesR. distinction,distinction,providingproviding strategicstrategic counselcounsel andandoutstandingoutstandingleadershipleadershipto ince1999.1999.In abiolaR. ngpartnerpartnerof cedexperienceddirector,director,to rOfficerof tionat halfbehalfof ofthetheCampbellCampbellBoard,Board,I commendI steadfasteffortseffortsin ina achallengingchallengingenvironment.environment.I alsoI mmitmentcommitmentto mostmostimportantly,importantly,I thankI neyVinneyChairmanChairmanofofthetheBoardBoard
Financial Highlights2017(dollars in millions, except per share amounts)Results of OperationsNet SalesGross ProfitPercent of SalesEarnings before interest and taxesNet earnings attributable to Campbell Soup CompanyPer share — dilutedOther InformationNet cash provided by operating activitiesCapital expendituresDividends per share 2016 7,8903,05938.8%1,4008872.89 7,9612,78034.9%9605631.81 1,2913381.40 1,4913411.248In 2017, Net earnings attributable to Campbell Soup Company included the following: a restructuring charge, related costs and administrative expenses of 37 ( 0.12 per share) associated with restructuring and cost savings initiatives; gains of 116 ( 0.38 per share) associated with mark-to-market adjustments fordefined benefit pension and postretirement plans; impairment charges of 180 ( 0.59 per share) related to the intangible assets of the Bolthouse Farms carrotand carrot ingredients reporting unit and the Garden Fresh Gourmet reporting unit; and a tax benefit and reduction to interest expense of 56 ( 0.18 pershare) primarily associated with the sale of intercompany notes receivable to a financial institution.In 2016, Net earnings attributable to Campbell Soup Company included the following: a restructuring charge and administrative expenses of 49 ( 0.16 pershare) associated with restructuring and cost savings initiatives; losses of 200 ( 0.64 per share) associated with mark-to-market adjustments for definedbenefit pension and postretirement plans; an impairment charge of 127 ( 0.41 per share) related to the intangible assets of the Bolthouse Farms carrot andcarrot ingredients reporting unit; and a gain of 25 ( 0.08 per share) associated with a settlement of a claim related to the Kelsen acquisition.See below for a reconciliation of the impact of these items on reported results.Reconciliation of GAAP and Non-GAAP Financial MeasuresThe following information is provided to reconcile certain non-GAAP financial measures disclosed in the Letter to Shareholders to reported sales and earningsresults. These non-GAAP financial measures are measures of performance not defined by accounting principles generally accepted in the United States andshould be considered in addition to, not in lieu of, GAAP reported measures. We believe that presenting certain non-GAAP financial measures facilitatescomparison of our historical operating results and trends in our underlying operating results, and provides transparency on how we evaluate our business. Forinstance, we believe that organic net sales, which exclude the impact of currency, are a better indicator of our ongoing business performance. We also believethat the financial information excluding certain transactions not considered to be part of the ongoing business improves the comparability of year-to-year earningsresults. Consequently, we believe that investors may be able to better understand our earnings results if these transactions are excluded from the results.2017(dollars in millions) 7,890Net Sales2016% Change 7,961-1%Volume and Mix-1%Price and Sales Allowances0%Promotional Spending-1%Organic Growth-1%Currency0%Total-1%The sum of the individual amounts does not add due to ningsImpactDilutedEPSImpactNet earnings attributable toCampbell Soup Company, as reported 887 2.89 563 1.81Restructuring charges, implementation costsand other related costs370.12490.16(116)(0.38)(dollars in millions, except per share amounts)Pension and postretirement benefitmark-to-market adjustmentsImpairment chargesSale of notesClaim settlementAdjusted Net earnings attributableto Campbell Soup Company2000.641270.41(56)0.59(0.18)----(25)(0.08) 932 3.04 914 2.94180Earnings % ChangeEPS % Change2017/20162017/20162%3%Campbell Soup Company 8
ADERSHIPLEADERSHIPTEAMTEAMLesLesC. C.VinneyVinneyChairmanChairmanof xecutiveOfficerOfficerof hiefExecutiveExecutiveOfficerOfficer(As(Asof utiveExecutiveOfficerOfficerof iolaR. nagingPartnerPartner2, 42, 4of Co-founderCo-founder2, 42, 4of ndChiefChiefExecutiveExecutiveOfficerOfficer2, 42, 4of B. fChiefExecutiveExecutiveOfficerOfficerof ofPitneyPitneyBowesBowesInc.Inc.1, 2 1, 2(As(Asof ofSeptemberSeptember2017)2017)MarkMarkR. agesCarlosCarlosJ. entDevelopmentandandQualityQualityEdwardEdwardL. alCounselCounselAnthonyAnthonyP. D. D.MaloneMalone3,4 3,4PresidentPresidentof utiveExecutiveOfficerOfficer1, 3 1, 3of ofTheTheDunDun& Bradstreet& OfficerOfficerKeithKeithR. R.McLoughlinMcLoughlin2, 42, ficerof SalesSalesCharlesCharlesR. ChiefChiefExecutiveExecutiveOfficerOfficer1, 3 1, 3of ofAvonAvonProducts,Products,Inc.Inc.EmilyEmilyP. ExecutiveExecutiveOfficerOfficer2, 42, 4of ofTetraTetraPakPakGroupGroup* Executive* ExecutiveOfficersOfficersTraceyTraceyT. fficer1, 3 1, 3of Inc.Inc.ArchboldArchboldD. VicePresidentPresident1, 3 1, 3of Committees1 Audit1 Audit2 Compensation2 Compensation& Organization& Organization3 Finance3 Finance& Corporate& CorporateDevelopmentDevelopment4 Governance4 Governance9 9CampbellCampbellSoupSoupCompanyCompany
UNITED STATES SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549Form 10-KANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the Fiscal Year EndedJuly 30, 2017Commission File Number1-3822CAMPBELL SOUP COMPANYNew JerseyState of Incorporation21-0419870I.R.S. Employer Identification No.1 Campbell PlaceCamden, New Jersey 08103-1799Principal Executive OfficesTelephone Number: (856) 342-4800Securities registered pursuant to Section 12(b) of the Act:Title of Each ClassCapital Stock, par value .0375Name of Each Exchange on Which RegisteredNew York Stock ExchangeSecurities registered pursuant to Section 12(g) of the Act: NoneIndicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. YesNoIndicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes NoIndicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the SecuritiesExchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports),and (2) has been subject to such filing requirements for the past 90 days. YesNoIndicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, everyInteractive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months(or for such shorter period that the registrant was required to submit and post such files). YesNoIndicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, andwill not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by referencein Part III of this Form 10-K or any amendment to this Form 10-K.Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smallerreporting company or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smallerreporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.Large accelerated filerAccelerated filerIf an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition periodfor complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes NoAs of January 27, 2017 (the last business day of the registrant’s most recently completed second fiscal quarter), the aggregatemarket value of capital stock held by non-affiliates of the registrant was approximately 11,934,667,846. There were 300,528,501shares of capital stock outstanding as of September 20, 2017.Portions of the Registrant’s Proxy Statement for the Annual Meeting of Shareholders to be held on November 15, 2017, areincorporated by reference into Part III.
TABLE OF CONTENTSPART IItem 1. Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Item 1A. Risk Factors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Item 1B. Unresolved Staff Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Item 2. Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Item 3. Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Item 4. Mine Safety Disclosures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Executive Officers of the Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .PART IIItem 5. Market for Registrant’s Capital Stock, Related Shareholder Matters and Issuer Purchases ofEquity Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Item 6. Selected Financial Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. . . .Item 7A. Quantitative and Qualitative Disclosure about Market Risk . . . . . . . . . . . . . . . . . . . . . . . . . .Item 8. Financial Statements and Supplementary Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure . . .Item 9A. Controls and Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Item 9B. Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .PART IIIItem 10. Directors, Executive Officers and Corporate Governance. . . . . . . . . . . . . . . . . . . . . . . . . . . . .Item 11. Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Item 12. Security Ownership of Certain Beneficial Owners and Management and Related ShareholderMatters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Item 13. Certain Relationships and Related Transactions, and Director Independence . . . . . . . . . . . . .Item 14. Principal Accounting Fees and Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .PART IVItem 15. Exhibits and Financial Statement Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Item 16. Form 10-K Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Index to Exhibits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23510101010111113143233767676767677777777787982
PART IThis Report contains "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995.These forward-looking statements reflect our current expectations regarding our future results of operations, economicperformance, financial condition and achievements. These forward-looking statements can be identified by words such as"anticipate," "believe," "estimate," "expect," "will," "goal," and similar expressions. One can also identify forward-lookingstatements by the fact that they do not relate strictly to historical or current facts. These statements reflect our current plans andexpectations and are based on information currently available to us. They rely on several assumptions regarding future events andestimates which could be inaccurate and which are inherently subject to risks and uncertainties. Risks and uncertainties include,but are not limited to, those discussed in "Risk Factors" and in the "Cautionary Factors That May Affect Future Results" in"Management’s Discussion and Analysis of Financial Condition and Results of Operations" in this Report. Our consolidatedfinancial statements and the accompanying notes to the consolidated financial statements are presented in "Financial Statementsand Supplementary Data."Item 1. BusinessThe CompanyUnless otherwise stated, the terms "we," "us," "our" and the "company" refer to Campbell Soup Company and its consolidatedsubsidiaries.We are a manufacturer and marketer of high-quality, branded food and beverage products. We organized as a businesscorporation under the laws of New Jersey on November 23, 1922; however, through predecessor organizations, we trace ourheritage in the food business back to 1869. Our principal executive offices are in Camden, New Jersey 08103-1799.In 2013, we acquired BF Bolthouse Holdco LLC (Bolthouse Farms) and Plum, PBC (formerly Plum Inc.) (Plum). In 2014,we acquired Kelsen Group A/S (Kelsen) and divested our European simple meals business. In 2015, we acquired the assets ofGarden Fresh Gourmet. In 2017, we entered into an agreement to acquire Pacific Foods of Oregon, Inc. for 700 million. Foradditional information o
Real food has become a non-negotiable demand. People have simply come to expect it. Campbell is listening and taking our cues on health and well-being from consumers. On the well-being side that means food that is engaging, comforting and provides a sense of purpose, a reward an
