the six-months ended February 1, 2009, the company recorded pre-tax restructuring related costs of $15 million ($10 million after tax or $.03 per share). See Note (l) to the Consolidated Financial Statements and "Restructuring Charges" for additional information;

• In the second quarter of 2008, the company recognized a non-cash tax benefit of $13 million ($.03 per share) from the favorable resolution of a state tax contingency in the United States;

Discontinued Operations
• In the second quarter of fiscal 2009, the company recorded a $4 million tax benefit ($.01 per share) related to the sale of the Godiva Chocolatier business; and

• In the second quarter of 2008, the company recognized costs of $9 million ($5 after tax or $.01 per share) associated with the sale of the Godiva Chocolatier business.

The items impacting comparability are summarized below:

                                                                 Three Months Ended
                                                        2009                            2008
                                              Earnings           EPS          Earnings           EPS
(millions, except per share amounts)           Impact          Impact          Impact          Impact

Earnings from continuing operations           $     229        $  0.63        $     260        $  0.67


Earnings from discontinued operations         $       4        $  0.01        $      14        $  0.04


Net earnings                                  $     233        $  0.64        $     274        $  0.71


Continuing operations:

Restructuring related costs                   $       5        $  0.01        $       -        $     -

Benefit from resolution of state tax
contingency                                           -              -              (13 )        (0.03 )

Discontinued operations:

Tax benefit from sale of Godiva
Chocolatier business                          $      (4 )      $ (0.01 )      $       -        $     -

Costs associated with the sale of Godiva
Chocolatier business                                  -              -                5           0.01


Impact of significant items on net
earnings1                                     $       1        $  0.01        $       8        $ (0.02 )

1 The sum of the individual per share amounts does not equal due to rounding.

The company reported earnings from continuing operations of $229 million for the second quarter ended February 1, 2009, versus $260 million in the comparable quarter a year ago. Earnings per share from continuing operations were $.63 compared to $.67 a year ago. After factoring in the items impacting comparability, earnings from continuing operations decreased primarily due to the unfavorable impact of currency. After factoring in the items impacting comparability, earnings per share from continuing operations in the current quarter benefited from a reduction in the weighted average diluted shares outstanding, which was primarily due to share repurchases utilizing the net proceeds from the divestiture of the Godiva Chocolatier business and the company's strategic share repurchase programs. Earnings per share from continuing operations were negatively impacted by $.04 from currency translation.
Earnings from discontinued operations of $4 million for the second quarter ended February 1, 2009 represented an adjustment to the tax liability associated with the sale of the Godiva Chocolatier business. Earnings from discontinued operations were $14 million in the comparable quarter a year

ago and included costs associated with the sale of the Godiva Chocolatier business and operating performance. Earnings per share from discontinued operations were $.01 compared to $.04 a year ago.
After factoring in the items impacting comparability, net earnings and net earnings per share decreased. Net earnings per share were negatively impacted by $.04 from currency translation. Net earnings per share in the current quarter benefited from a reduction in the weighted average diluted shares outstanding primarily due to share repurchases utilizing the net proceeds from the divestiture of the Godiva Chocolatier business and the company's strategic share repurchase programs.
Currency translation could continue to impact fiscal 2009 results. Approximately 25 to 30 percent of sales and earnings are from non-U.S. operations. Given the strength and volatility of the U.S. dollar against the principal foreign currencies where the company operates, including the Australian dollar, the Canadian dollar and the euro, fluctuations in foreign currency exchange rates can have a significant impact on reported results. Given the market volatility, it is difficult to forecast the impact of currency. If currency exchange rates were to remain the same as at quarter end, currency translation would negatively impact sales and net earnings per share growth rates by approximately 5 percentage points in fiscal 2009.

                                                                  Six Months Ended
                                                        2009                            2008
                                              Earnings           EPS          Earnings           EPS
(millions, except per share amounts)           Impact          Impact          Impact          Impact

Earnings from continuing operations           $     489        $  1.34        $     528        $  1.36


Earnings from discontinued operations         $       4        $  0.01        $      16        $  0.04


Net earnings1                                 $     493        $  1.35        $     544        $  1.41


Continuing operations:

Restructuring related costs                   $      10        $  0.03        $       -        $     -

Unrealized losses on commodity hedges                16           0.04                -              -

Benefit from resolution of state tax
contingency                                           -              -              (13 )        (0.03 )

Discontinued operations:

Tax benefit from the sale of Godiva
Chocolatier business                          $      (4 )      $ (0.01 )      $       -        $     -

Costs associated with the sale of Godiva
Chocolatier business                                  -              -                5           0.01


Impact of significant items on net
earnings                                      $      22        $  0.06        $      (8 )      $ (0.02 )

1 The sum of the individual per share amounts does not equal due to rounding.

For the six-months ended February 1, 2009, net earnings were $493 million compared to $544 million a year ago. Net earnings per share were $1.35 compared to $1.41 a year ago. Net sales decreased 1% to $4.372 billion in 2009 from $4.403 billion last year.
For the six-months ended February 1, 2009, earnings from continuing operations were $489 million compared to $528 million a year ago. Earnings per share from continuing operations were $1.34 compared to $1.36 a year ago. After factoring in the items impacting comparability, earnings from continuing operations were flat compared to the prior year while earnings per share from continuing operations in the current period increased due to the benefit from a reduction in the weighted average diluted shares outstanding, which was primarily due to share repurchases utilizing the net proceeds from the divestiture of the Godiva Chocolatier business and the company's strategic share repurchase programs. Earnings per share from continuing operations were negatively impacted by $.05 from currency translation.

For the six-months ended February 1, 2009, earnings from discontinued operations of $4 million represented an adjustment to the tax liability associated with the sale of the Godiva Chocolatier business. Earnings from discontinued operations were $16 million in 2008 and included costs associated with the sale of the Godiva Chocolatier business and operating performance. Earnings per share from discontinued operations were $.01 in 2009 and $.04 in 2008.
After factoring in the items impacting comparability, net earnings declined primarily due to the unfavorable impact of currency while net earnings per share increased. Net earnings per share were negatively impacted by $.05 from currency translation. Net earnings per share benefited from a reduction in the weighted average diluted shares outstanding, which was primarily due to share repurchases utilizing the net proceeds from the divestiture of the Godiva Chocolatier business and the company's strategic share repurchase programs. Developments in Key Strategic Initiatives The company continues to implement previously announced plans and programs intended to advance its seven key strategies to achieve long-term sustainable sales and earnings growth. Consistent with its strategic focus on wellness, quality and convenience, the company is pursuing initiatives designed to meet the growing consumer interest in health and nutrition. In the first six months of fiscal 2009, the company continued to support the introduction of Campbell's Select Harvest, a line of ready-to-serve soups with lower sodium, and Campbell's V8 soups, a line of 100% vegetable soups in aseptic packaging. The company also lowered the sodium level in its entire line of condensed children's soups, expanded the availability of its gravity-feed shelving systems for condensed, ready-to-serve and convenience soup products, and introduced a new line of Swanson stock. Commencing in fiscal 2010, the company plans to further reduce the sodium level in a number of its soup products. The sodium level in the company's iconic Campbell's condensed tomato soup will be reduced by 32% to the healthy level of sodium (defined by the U.S. government as 480 mg per serving) while maintaining its classic taste profile. The company also plans to reduce the sodium level in its Campbell's V8 soups to 480 mg per serving and in its Healthy Request soups from 480 mg to 410 mg per servings, further enhancing the nutritional profile of both lines. Similarly, the company plans to restage its line of Campbell's Chunky soups to make them heartier and healthier, with enhanced vegetable and protein content. Finally, the company plans to launch five new or restaged varieties of light condensed soup and to make a number of changes to its Campbell's Select Harvest soup and its Swanson broth offerings, enhancing their consumer appeal. The focus on wellness, quality and convenience is not limited to the company's soup products, as the company continues to emphasize the health credentials of many of its other products, such as V8 beverages and many of its Pepperidge Farm products.

SECOND QUARTER
Sales
An analysis of net sales by reportable segment follows:

                                                       (millions)
                                                    2009        2008       % Change

       U.S. Soup, Sauces and Beverages            $ 1,128     $ 1,093           3 %
       Baking and Snacking                            440         491         (10 )
       International Soup, Sauces and Beverages       391         458         (15 )
       North America Foodservice                      163         176          (7 )

                                                  $ 2,122     $ 2,218          (4 )%

An analysis of percent change of net sales by reportable segment follows:

                                                                          International
                                       U.S. Soup,         Baking              Soup,                North
                                       Sauces and          and             Sauces and             America
                                       Beverages         Snacking           Beverages           Foodservice        Total
Volume and Mix                             (3 )%             (1 )%               (5 )%                 (9 )%         (3 )%
Price and Sales Allowances                 10                 9                   5                     6             9
(Increased)/Decreased
Promotional Spending 1                     (4 )              (2 )                 1                    (1 )          (3 )
Currency                                    -                (8 )               (13 )                  (3 )          (5 )
Divestitures                                -                (8 )                (3 )                   -            (2 )

                                            3 %             (10 )%              (15 )%                 (7 )%         (4 )%

1 Represents revenue reductions from trade promotion and consumer coupon redemption programs.

In U.S. Soup, Sauces and Beverages, total soup sales increased 4 percent. U.S. soup sales, especially condensed soup sales, were negatively impacted by reductions in certain retailer inventory levels during the quarter. Sales of condensed soups increased 1 percent with gains in cooking varieties, as consumers ate more meals at home. Sales of ready-to-serve soups increased 7 percent due to the successful launches of Campbell's Select Harvest soups and Campbell's V8 soups, and gains in Campbell's Chunky canned soups. These gains were partially offset by declines in sales of the convenience platform, which includes soups in microwavable bowls and cups. The Wolfgang Puck soup, stock and broth business acquired in June 2008 contributed modestly to soup sales growth. Broth sales increased 3 percent due to the introduction of Swanson cooking stock, partially offset by increased promotional spending in response to competitive activity. Beverage sales increased slightly following double-digit growth a year ago. The sales increase was driven by the strong performance of V8 V-Fusion juice and growth in V8 Splash juice drinks, partially offset by declines in V8 vegetable juice and Campbell's tomato juice. Prego pasta sauce sales increased. Sales of Pace Mexican sauces were unchanged. Sales of both sauce products were significantly impacted by reductions in certain retailer inventory levels.

In Baking and Snacking, Pepperidge Farm achieved sales growth with gains in the cookies and crackers and bakery businesses. In the cookies and crackers business, sales increased driven by double-digit gains in Goldfish snack crackers and in Milano cookies, as well as the introduction of Baked Naturals, an adult savory snack cracker. The bakery business delivered sales growth behind whole-grain and swirl breads. On an as reported basis, Arnott's sales declined due to the divestiture of certain salty snack food brands in May 2008 and the unfavorable impact of currency. Excluding these items, Arnott's sales increased due to growth in all categories: savory, chocolate, and sweet. Sales of biscuits in Indonesia grew strongly.
In International Soup, Sauces and Beverages, sales decreased in Europe primarily due to the unfavorable impact of currency, the divestiture of the company's French sauce and mayonnaise business in September 2008, and lower sales in Germany. In Canada, sales declined due to the unfavorable impact of currency, partially offset by gains in the soup business. In Asia Pacific, sales increased primarily due to gains in the Australian soup business and Malaysia, partially offset by the unfavorable impact of currency.
In North America Foodservice, excluding the impact of currency, sales declined primarily due to weakness in the food service sector. Gross Profit
Gross profit, defined as Net sales less Cost of products sold, decreased from $889 million in 2008 to $837 million in 2009. As a percent of sales, gross profit decreased from 40.1% in 2008 to 39.4% in 2009. The percentage point decrease was due to costs related to the initiatives to improve operational efficiency and long-term profitability (approximately 0.4 percentage points), increased promotional spending (approximately 1.5 percentage points), and the impact of cost inflation and other factors (approximately 6.1 percentage points), partially offset by higher selling prices (approximately 5.6 percentage points) and productivity improvements (approximately 1.7 percentage points). Marketing and Selling Expenses
Marketing and selling expenses as a percent of sales were 14.8% in 2009 and 14.4% in 2008. Marketing and selling expenses decreased 1% in 2009 from 2008. The decrease was primarily due to the impact of currency (approximately 4 percentage points), partially offset by higher advertising expenses (approximately 3 percentage points). The higher advertising expenses were primarily in the U.S. soup and sauces businesses. Administrative Expenses
Administrative expenses as a percent of sales were 6.5% in 2009 and 6.4% in 2008. Administrative expenses decreased by 2% in 2009 from 2008, primarily due to the impact of currency (approximately 4 percentage points), partially offset by the incremental cost to establish businesses in Russia and China (approximately 2 percentage points).

Operating Earnings
An analysis of operating earnings by reportable segment follows:

                                                       (millions)
                                                     20091     2008      % Change

         U.S. Soup, Sauces and Beverages            $ 270     $ 286          (6 )%
         Baking and Snacking                           53        68         (22 )
         International Soup, Sauces and Beverages      50        61         (18 )
         North America Foodservice                     10        20         (50 )

                                                      383       435         (12 )
         Corporate                                    (28 )     (35 )

                                                    $ 355     $ 400         (11 )%

1 Operating earnings by segment include restructuring related costs of $2 million in Baking and Snacking and $6 million in North America Foodservice. See Note
(l) for
additional
information
on
restructuring
charges.

Earnings from U.S. Soup, Sauces and Beverages decreased 6% in 2009 versus 2008, as higher costs, including advertising associated with the introduction of new products in the U.S. Soup business, were partially offset by increased sales. Earnings from Baking and Snacking decreased 22% in 2009 versus 2008. The current quarter included $2 million in accelerated depreciation and other exit costs related to the initiatives to improve operational efficiency and long-term profitability. The remaining decrease was due to a decline in Pepperidge Farm and the unfavorable impact of currency, partially offset by significant growth in Arnott's.
Earnings from International Soup, Sauces and Beverages decreased 18%, or $11 million, in 2009 versus 2008. The decline in operating earnings was due to the unfavorable impact of currency. Excluding the impact of currency, operating earnings increased in Europe, reflecting the benefit of cost savings initiatives, and in Canada, primarily offset by incremental cost to establish businesses in Russia and China.
Earnings from North America Foodservice in 2009 declined $10 million, or 50%, from 2008. The current quarter included $6 million in accelerated depreciation and other exit costs related to the initiatives to improve operational efficiency and long-term profitability. The remaining decline in operating earnings was primarily due to lower sales volumes.
Corporate expenses in 2009 decreased from $35 million in 2008 to $28 million. The decrease was primarily due to lower expenses associated with the implementation of the SAP enterprise-resource planning system in North America. Nonoperating Items
Net interest expense decreased to $25 million from $42 million in the prior year, primarily due to significantly lower short-term interest rates.

The effective tax rate for the quarter was 30.6% in 2009. The effective rate for the year-ago quarter was 27.4%. The prior-year quarter included a $13 million tax benefit from the favorable resolution of a state tax matter.

SIX MONTHS
Sales
An analysis of net sales by reportable segment follows:

                                                       (millions)
                                                    2009        2008       % Change

       U.S. Soup, Sauces and Beverages            $ 2,326     $ 2,190           6 %
       Baking and Snacking                            949       1,023          (7 )
       International Soup, Sauces and Beverages       771         848          (9 )
       North America Foodservice                      326         342          (5 )

                                                  $ 4,372     $ 4,403          (1 )%

An analysis of percent change of net sales by reportable segment follows:

                                                                           International
                                       U.S. Soup,          Baking              Soup,                North
                                       Sauces and           and             Sauces and             America
                                        Beverages         Snacking           Beverages           Foodservice        Total
Volume and Mix                                - %             (1 )%              (2 )%                  (8 )%         (1 )%
Price and Sales Allowances                    9                9                  4                      6             8
Increased Promotional Spending 1             (3 )             (2 )               (1 )                   (1 )          (3 )
Currency                                      -               (5 )               (8 )                   (2 )          (3 )
Divestitures                                  -               (8 )               (2 )                    -            (2 )

                                              6 %             (7 )%              (9 )%                  (5 )%         (1 )%

1 Represents revenue reductions from trade promotion and consumer coupon redemption programs.

In U.S. Soup, Sauces and Beverages, total U.S. soup sales increased 8% as ready-to-serve soup sales increased 7%, condensed soup sales increased 8% and broth sales increased 13%. The ready-to-serve soup sales increase was primarily due to the successful launches of Campbell's Select Harvest soups and Campbell's V8 soups, partially offset by declines in Chunky canned soups and in the convenience platform. In condensed, sales increased in both cooking and eating varieties. The increase in broth sales was driven by the continued success of the base business and the introduction of Swanson stock products. The Wolfgang Puck soup, stock and broth business acquired in June 2008 contributed modestly to soup sales growth. Beverage sales increased slightly, following double-digit growth a year ago. The increase was driven by continued double-digit growth in V8 V-Fusion juice, partially offset by declines in V8 vegetable juice and Campbell's tomato juice. Prego

pasta sauce sales increased due to growth in Prego Heart Smart varieties. Sales of Pace Mexican sauces increased primarily due to the introduction of a new line of specialty salsas.
In Baking and Snacking, Pepperidge Farm achieved sales growth with gains in the cookies and crackers and bakery businesses. In the cookies and crackers business, sales increased due to gains in Goldfish snack crackers, as well as the introduction of Baked Naturals, an adult savory snack cracker. The bakery business delivered sales growth behind whole-grain and swirl breads. On an as reported basis, Arnott's sales declined due to the divestiture of certain salty snack food brands in May 2008 and the unfavorable impact of currency. Excluding these items, Arnott's sales increased due to growth in savory crackers. Sales of biscuits in Indonesia grew strongly.
In International Soup, Sauces and Beverages, sales declined primarily due to the impact of currency and divestitures. Excluding currency and divestitures, sales increased as gains in Asia Pacific and Canada were partially offset by declines in Europe.
In North America Foodservice, excluding the impact of currency, sales declined primarily due to the negative impact from discontinuing certain unprofitable products and weakness in the food service sector. Gross Profit . . .