US: Kraft reports higher Q1 profits
- Kraft Q1 net profit up 1.8%
- Price hikes, early Easter helps sales
- CFO hails "great start" to year
Kraft Foods has reported an increase in first-quarter earnings as price increases and an earlier Easter than last year boosted sales.
Kraft yesterday (3 May) reported a 1.8% increase in net earnings to US$819m for the three months to the end of March.
Operating income was up 2.7% at $1.69bn, although margins dipped from 13.1% in last year's first quarter to 12.9%.
However, underlying operating margin, which excludes costs linked to restructuring and Kraft's plan to split in two later this year, increased 0.2 percentage points to 14.1%.
Net revenue increased 4.1% to $13.1bn. On an organic basis, revenue increased 6.5% on the back of price increases and higher volumes, which were boosted by the shift of Easter sales into the first quarter.
"Our first quarter gave us a great start to the year," CFO David Brearton said. "We continue to expect 2012 organic net revenue growth of approximately 5% and operating EPS growth of at least 9% on a constant-currency basis."
Chairman and CEO Irene Rosenfeld said Kraft was "on track" to create "two industry-leading companies" by the end of the year.
Kraft's split, announced last year, will lead to the formation of a North American grocery business called Kraft Foods Group and a global snacks company, which is set to be named Mondelez International.
Click here for the full statement from Kraft.
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