Macaroni and cheese and ketchup king reported sales and earnings that exceeded forecasts Thursday. The company posted solid sales gains in its U.S. retail business, citing strong consumer demand due to the Covid-19 outbreak. Still, shares of Kraft Heinz (KHC) fell 6% in late-morning trading Thursday.
Kraft Heinz has been in change mode for the past few years. The company has been struggling to keep up with rivals who have launched more innovative food products as consumers have sought out healthier organic foods as well as plant-based alternatives to meat.
But Kraft Heinz has resumed in 2020 under the leadership of new CEO Miguel Patricio, who had aggressively written brands that did little to focus more on key products that continue to do well.
“Our response to the ongoing COVID-19 pandemic reflects the hard work and dedication of our notable employees around the world,” Patricio said in a statement. “We are now beginning to realize the benefits of agility and scale.”
In those lines, Kraft Heinz announced that it would take nearly $ 3 billion in second-quarter positions to reflect goodwill impairment payments of $ 1.8 billion for some of its reporting units and $ 1.1 billion. billion in posts due to the poor performance of Oscar Mayer, Maxwell House and other brands.
Shares of Kraft Heinz are now nearly 5% this year. The solid earnings report is good news for the company’s top executives – private equity firm 3G Capital and Warren Buffett Berkshire Hathaway (BRKB). Berkshire and 3G merged in 2013 to buy Heinz and merged it with Kraft two years later.