Sales at Kraft Heinz Hurt by Lower Prices but Profits Soar
04 Nov 2016 --- Lower prices in Europe and the US dented sales at Kraft Heinz but the food giant swung back into profit in its latest quarterly results. The maker of Heinz Ketchup, Jell-O and Vegemite reported that sales fell from $6.36bn to $6.27bn in the third quarter but the company jumped from a $120m loss last year to profits of $843m in the period.
In the US, sales came in at $4.4bn, down 1.2 percent on the year previous, with pricing down in coffee and meat-based products.
Lunchables and the marconi and cheese portfolio performed well in the US but there were declines in cold cuts, foodservice and nuts.
In Europe, sales were down 14.5 percent to $513m, as it was hit by lower prices compared to the previous year.
There was also "ongoing consumption weakness" in the UK and the Netherlands, Kraft Heinz said.
Like its competitors, Kraft Heinz is trying to manage the consumer shift from packaged foods to healthier options.
“Overall, our third quarter results are a good representation of where we are as a company,” said Kraft Heinz CEO Bernardo Hees.
“While our financial performance is respectable, we continue to have the opportunity to improve our offerings and retail execution in several key markets and take our brands to places they don’t currently compete.”
“Our focus now is to finish 2016 strong and set the stage for another year of strong, profitable growth in 2017.”
Kraft and Heinz merged in 2015 making it one of the largest food beverage companies in the world.
