The US food company Campbell Soup Co. has lowered its forecast for a key annual earnings metric.

The soup, sauce and snack maker assumes that its “adjusted” EBIT will decrease by 4-5% compared to its previous earnings estimate, with this metric decreasing by 1% in the worst case and increasing by 1% at best.

Campbell’s new forecast comes as the company released its third quarter results today (June 9), which included an 11% drop in revenue to $ 1.98 billion.

The Prego Sauce owner said the decline was due to the Covid-triggered spike in sales last year.

Campbell also pointed to the impact of the sale of the Plum baby food brand and snack business last month.

„In the fourth quarter, the company expects continued margin pressure in connection with the transition from the Covid-19 environment and more pronounced inflation, while the price measures take effect at the beginning of fiscal year 2022,” it said.

In light of Campbell’s third quarter sales decline, CEO Mark Clouse said, “Although we realized that the third quarter would be a challenging net sales comparison with the surge in demand at the start of the Covid-19 pandemic a year ago, we have faced additional headwinds.

“Our results were impacted by a rising inflationary environment, short-term increases in supply chain costs and some pressures to implement as we continued to advance our transformation agenda, mainly in our snacks space.

“We are confident that all of these can be addressed and are taking appropriate action, including fixing prices for the next fiscal year.

“Our trust is further strengthened by the underlying health of our brands. Almost three quarters of our portfolio gained or held shares during the quarter, with most of our core categories growing faster than before the pandemic.

Campbell’s adjusted EBIT decreased 27% to $ 283 million in the third quarter. On a reported basis, EBIT was $ 272 million compared to $ 273 million a year ago.

Net income attributable to Campbell decreased 5% to $ 160 million.

For the first nine months of Campbell’s fiscal year, sales were $ 6.6 billion, compared to $ 6.58 billion a year ago. EBIT increased 21% to $ 1.13 billion. The adjusted EBIT of 1.14 billion US dollars is „comparable” to the previous year.

Nine-month net income attributable to Campbell was $ 714 million, down 54% from a year earlier.

Campbell’s shares were down 5.5% to $ 46.42 at 9:59 a.m. ET today.