Kraft Heinz misses sales expectations | Progresiv
Kraft Heinz’s share price, which took something of a hammering in 2019, slid again after the publication of the food giant’s latest financial results and its outlook for 2020. 
Although earnings beat analysts’ estimates, the ketchup maker’s shares fell almost 8% after it revealed that fourth-quarter net sales had slipped 5.1% to 6.89 billion dollars. Even after stripping out the impacts of exchange rates and asset disposals, sales dropped by 2.2% on an organic basis, a worse performance than Wall Street had expected.
The stock is now down nearly 40% in the past year with the company still struggling to adapt to changing consumer tastes and their aversion to processed food. Kraft Heinz’s sales have now been muted for 14 straight quarters with the popularity of cheaper private label products also taking its toll on demand for the company’s branded portfolio.
GlobalData’s Dean Best commented: “Crucially, Kraft Heinz’s metric of ‘volume/mix’ was down by more than 4% in the quarter. The company can point to the impact on demand of price increases but that is not a result it will want to become a trend.
“Looking ahead, Kraft Heinz is set to invest in media spend to support its brands, while the company has indicated it will sell off more assets or exit certain businesses to further refocus its efforts.
“These are, on paper, positive signs CEO Miguel Patricio is trying to make moves to stabilise and then improve Kraft Heinz’s performance. He admits a ‘turnaround will take time’ but expects to make ‘significant progress’ this year in ‘laying a strong foundation for future growth’.
“Getting sales moving in the right direction will be crucial and that won’t be an overnight fix.” (www.kamcity.com)
