U.S. food producer Kraft Heinz Co reported higher-than-expected quarterly sales and profit on Thursday, helped by coronavirus-related stockpiling.
The maker of Heinz ketchup, Kraft Macaroni & Cheese and Oscar Mayer lunch meat said first-quarter sales were $6.16 billion, slightly ahead of analysts’ average estimate of $6.14 billion, according to IBES data from Refinitiv. Excluding hits from currency fluctuations and divestitures, organic sales rose 6.2 per cent, in line with a forecast the company gave earlier this month.
It warned then that the full benefit from the incremental sales lift would not fall to the bottom line, due to costs related to meeting the higher demand.
About 6 to 7 percentage points of sales growth were due to increased consumer demand related to the COVID-19 pandemic, as shoppers stocked up on pantry staples.
First-quarter net income fell to $378 million, or 31 cents per share, from $405 million, or 33 cents per share, a year earlier. Excluding items, adjusted earnings were 58 cents per share, topping analysts’ average estimate of 55 cents.
Looking forward, the company forecast low to mid-single-digit organic net sales growth and mid-single-digit constant-currency adjusted EBITDA growth for the current second quarter. It said that outlook reflected incremental demand from retail customers due to increased at-home consumption, particularly in developed markets, and reduced demand in foodservice channels globally.
“The impact of the COVID-19 pandemic on the company’s full-year 2020 results remains uncertain,” the company said.
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