Higher dairy costs have slashed quarterly profits at US giant Kraft Foods.
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The Philadelphia cheese maker posted third-quarter operating profit of US$981m, a fall of almost 28% on the year.
Kraft said that much of the fall in earnings was due to comparisons with the third-quarter of last year when the company enjoyed a one-time gain.
However, underlying operating profit fell 5.8% as dairy costs and increased marketing investment weighed on the business.
“Although we face a difficult input cost environment, we are making the necessary investments to strengthen our brand equity,” said Kraft chairman and CEO Irene Rosenfeld.
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By GlobalDataKraft’s third-quarter revenue rose 6.2% to $9.1bn as sales rose across North America, Europe and the company’s “developing markets”.
Kraft’s weakest category in North America was its grocery business, which saw sales dip 0.2%. The company said it suffered “volume weakness” in salad dressings and dry-packaged desserts.
