Australia’s chocolate treat, Tim Tams are to appear regularly in US shops for a few months of every year following a decision by the Campbell Soup Co.
Campbell owns Arnott’s, maker of Tim Tams, which have just returned to US outlets, especially the Target chain, via Campbell’s subsidiary, Pepperidge Farm.
That’s just in time for the northern winter.
It was the success of an exclusive deal a year ago through Target stores in the US, plus boosting Arnott’s Australian earnings, that convinced Campbell to make it an annual event.
According to Campbell, Australians consume over 400 million Tim Tam biscuits each year – that’s 35 million packs.
It now wants to boost those numbers in the US from October through to March each year which is the peak selling season for chocolate-based snacks in America.
They started selling a couple of weeks before Campbell released its first quarter profit figures this week showing an upturn in earnings, thanks in part to the improvement at Arnott’s and Tim Tams in Australia.
"In Australia, sales increased due to the favorable impact of currency and significant growth in Arnott’s, led by higher sales of "Tim Tam" biscuits."
Campbell said operating earnings in its bakery and snacking products division in the quarter ending November 1 "were $100 million compared with $83 million in the prior-year period.
"The increase in operating earnings was fueled by margin-driven growth in both Arnott’s and Pepperidge Farm and the favorable impact of currency."
That’s the sharp rise in the value of the Australian dollar in the November 1 quarter which meant more revenue and earnings when translated into lower valued US dollars.
The improvement helped Campbell Soup to a higher-than-expected profit for the quarter and the $US17 million increase matched the rise in the earnings contribution from the company’s dominant soup division.
Prices increases, lower costs for commodities such as grains (wheat and flour) and tomatoes and cost cuts were also factors.
Campbell earned $US304 million, up from $US260 million.
Sales fell 2.1% to $US2.2 billion. Soup sales in the US fell 3%, but Tim Tams helped save the day!
Campbell said in its commentary that it benefited from consumers eating more at home, pointing to the relative low price of a bowl of soup, compared with the cost of other foods.
The company says it expects earnings per share to increase by 9% to 11% this fiscal year, up from the long-range target of 5% to 7%.
Campbell also raised sales guidance for this year to 4%- 5%, up from the previous range of 3%-4%.
US analysts didn’t seem impressed.
They noted that the company said more favorable currency exchange rates would add 3%-4% to the earnings per share for the year, implying that the company might not do as well as it tried to say in the results chat.
But we in Australia know Tim Tams are the only low cost way of rewarding ourselves after thinking dieting, and don’t need a cold night to enjoy them.
