The company's bottom-line performance did manage to exceed analysts' expectations by a penny per share on that basis, according to Thomson Reuters, but revenues came in $100 million light of expectations at $2.12 billion, leading to the decline in the shares.

A strong U.S. dollar conspired against the company during the quarter as its international soups, sauces, and drinks account for nearly one-fifth of total sales. Campbell also said several retailers chose to cut back on inventories at the end of the year and retailers' "destocking" was one of the drivers of the reduced sales figure.

Campbell's President and CEO Douglas R. Conant said that while the reduced inventory levels impacted the company's U.S. soup, sauces, and beverages businesses, he was encouraged that consumer takeaway has outpaced sales growth. Regarding retailers cutting inventory he said, "It's about as low as it's going to go."

Mr. Conant believes CPB will weather the recession because its core product is the kind of food people eat more of when times are tough. He said U.S. soup sales rose 3% in the quarter and 8% for the first half of the fiscal year with growth in all formats: condensed, ready-to-serve, and broth. Mr. Conant said the company is encouraged by the successful launches of Campbell's Select Harvest and Campbell's V8 ready-to-serve soups and Swanson stock.

Campbell said gross margin fell to 39.4% in the second quarter compared with 40.1% a year ago as $8 million of costs for initiatives to improve operational efficiency and profitability ate into margins.

Campbell said that fiscal 2009 earnings growth would come in at the high end of its earlier 5% to 7% forecast range, excluding currency and other items, as margins will improve and from lower interest costs. Including the currency impact, it says earnings could come in as high as $2.13 per share, besting analyst estimates by one cent.

Jamie Dlugosch is a contributor to InvestorPlace.com.