Kraft and Heinz products
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Power Heinz on Thursday reported that the topped analysts' expectations, but continued to decline, […]
Shares of the company jumped 11.3% in morning trading. As of Wednesday's close, shares were down by about 33% this year, giving the food company a market value of $ 34.8 billion.
"While our third-quarter results are below our potential, we have seen sequential improvement versus the first half, and I believe we are beginning to operate better," CEO Miguel Patricio said in a statement.
The company is developing a plan for 2020 to revive Kraft Heinz's business, which has struggled with stalling sales and falling profits.
Wall Street was expecting, based on a survey of analysts by Refinitiv:
- 69 cents, adjusted, vs. 54 cents expected
- Revenue: $ 6.08 billion. $ 6.1
Kraft reported fiscal third-quarter net income of $ 899 million, or 74 cents per share, up from $ 619 million, or 50 cents per share, a year earlier.
Excluding gains from the sales of its 69 cents per share on an adjusted basis, topping the expected 54 cents per share.
In August, Kraft retired from his full-year 2019 forecast after reporting weak second-quarter results. The company declined to provide an updated outlook Thursday. CFO Paulo Basilio, who returned to the role in September this year, said investors should "pay close attention to their third quarter results."
Net sales during its third quarter dropped 4.8% to $ 6.08 billion, missing expectations of $ 6.13 billion.
In the United States, which accounts for approximately 70% of Kraft's revenue, demand for its products continued to decline. In spite of the fact that Oscar Mayer cold cuts, Philadelphia Cream Cheese and Lunchables, net sales for the company's home market shrank by 1.6%.
Patricio said analysts on the conference call that the company is developing nine "transformational" projects that wants to make power Heinz more efficient and improve its revenue.
"It's an area that's dramatically improved," Patricio said.
He told analysts that he was a senior marketing officer at Anheuser-Busch InBev, his team worked to reduce the time to bring new products to the market from two years to six months.