US: HJ Heinz H1 profits up on currency hedging
HJ Heinz posted a 17% rise in half-year profits today (21 November) as rising sales and currency hedging boosted earnings.
The US-bsed food giant recorded a net profit of US$506m for the period ended 29 October, compared with $432m from a year earlier. The increase includes a $97m rise in currency gains reflecting the company's decision to hedge translation exposures on key currencies.
Sales for the six months increased 8.9% to $5.2bn, with organic sales growth of 7.9%. Net pricing increased sales by 6.2%, as price increases were taken across the company's portfolio to help offset increases in commodity costs.
Operating income dropped slightly to $778.6m from $787.6m from the same period last year.
Net profit for the second quarter reached $276.7m compared with $227m a year earlier. Sales rose 3.5% to $2.61bn.
Heinz chairman, president, and CEO, William Johnson said he was "pleased" with the company's second-quarter results particularly given the "difficult economic environment".
"The company drove strong organic sales growth with many of our leading brands' pricing to mitigate substantially higher commodity costs," he said.
Heinz reaffirmed its full-year 2009 guidance for organic sales and for EPS, anticipating organic sales growth of "at least" 6% and EPS in the range of $2.87 to $2.91 for the fiscal year ending 29 April 2009.
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