Kraft Heinz has reported a 1.8% decline in third-quarter net sales to $6.32 billion but increased its expectations for 2021 adjusted EBITDA.
The company has increased its expectations for 2021 adjusted EBITDA from at least $6.1 billion to more than $6.2 billion.
Net income increased 23.2% to $736 million, primarily driven by a $300 million non-cash goodwill impairment loss in the year-ago period.
The owner of Philadelphia cream cheese and Heinz Ketchup says that its ‘better-than-expected’ results were enabled by “improvements in its operating model and an agile approach to managing supply and services through volatile markets”.
Pricing was up 1.5 percentage points versus the previous Q3 period, with ‘inflation-justified price increases’ in the foodservice and retail channels.
Miguel Patricio, Kraft Heinz CEO, commented on the results: “I am incredibly proud of our Kraft Heinz team for delivering another quarter of results that exceed our expectations, even as we face the ongoing challenges of the pandemic and, now, escalating inflation”.
He continued: “We are effectively adapting to near-term challenges while transforming our business and rejuvenating our iconic brands to better serve consumers for the long term. We still have much to do, but our momentum is strong and our strategy to bring agility to our scale is working, which is why we are increasing full-year expectations.”
Kraft Heinz expects organic net sales growth in 2021 to be “flat compared to an exceptionally strong 2020 period”.
This prediction includes the impact of the sale of the company’s nuts business, which was completed in June, but does not include the impact from the pending sale of its natural cheese business.
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