From time to time at Calcbench we sound a somewhat skeptical note about how much longer many companies can keep the good economic times rolling. Today Campbell Soup ($CPB) filed its latest quarterly report, and it demonstrates a few examples of the pressures we see.

At the top line, revenue growth looks good — up 24.6 percent, to $2.7 billion. Except that growth largely comes from two acquisitions Campbell closed earlier this year. Organic growth fell 3 percent.

We watch Campbell Soup because it relies heavily on aluminum for its soup cans, and we’re mildly obsessed with the Trump Administration’s tariffs on raw materials like aluminum. So we’re always looking for materials-heavy companies to see how their cost of revenue numbers are changing. The theory being that their costs may be rising due to tariffs and other expenses, eating away any revenue growth they see.

Well, Campbell saw big jumps in cost of revenue (up 35.7 percent), and marketing costs (up 13.2 percent), and administrative costs (up 18.1 percent). Throw in some restructuring charges, a slight trim in R&D costs, and you end up with total costs rising 34 percent — well above that 24.6 percent increase in revenue we just mentioned. See Figure 1, below.

In other words, those acquisitions earlier this year have Campbell working harder just to stay in place. Yes, that’s allowed to happen right after a large acquisition, since integrations are not easy. Still, financial analysts might want to tuck that fact away for a few quarters, to see whether the synergies Campbell promised at time of the deal closing actually come to pass.

Then we get to taxes. Yes, Campbell enjoyed a nice boost this year thanks to the corporate tax cuts Congress enacted last year. But in that case do the math—

• One year ago, before the tax cut, Campbell had $382 million in pre-tax earnings;
• Campbell paid $107 million on that amount, a tax rate of 28 percent;
• This year, after the tax cut, Campbell had $257 million in pre-tax earnings;
• Campbell paid $63 million on that amount, a tax rate of 24.5 percent.

So if we had never passed a corporate tax cut, and Campbell had to pay the same 28 percent rate on this year’s $257 million in earnings — that would be $72 million in taxes, and cut its net income from the $194 million it actually did report to $185 million.

In other words, the tax cut is propping up Campbell’s net income because organic growth isn’t there. You could also argue that the M&A deals earlier this year propped up revenue growth.

And once those tax cuts and M&A deals aren’t there — what happens then?

In theory, what happens is Campbell continues to remake itself away from a seller of soup to a seller of soup, snacks, and other food products. (The acquisitions earlier this year were in the snack business.) That is somewhat happening: soup sales actually fell in Q3 2018 compared to one year ago, while snack and other meal categories boomed (thanks to the acquisitions).

Will Campbell’s continue to pull off that re-engineering? Let’s hope so. 2018 was tough on Campbell: its share price steadily declined from $50 one year ago to $38 today.

One might even say Campbell got crunched like, well, an empty can.