Heinz has reported a fall in third-quarter sales amid declining revenues in North America and Asia Pacific.
The US food group, now privately-owned, revealed the 2% drop in net sales in a filing with the Securities and Exchange Commission. However, moves to cut costs led Heinz to report higher profits.
Go deeper with GlobalData
From 30 June to 28 September, the ketchup maker generated net sales of US$2.6bn, down from the $2.65bn it ran up from 24 June to 22 September in 2013.
Net sales in North America slid 6.4% to $982.2m. In Asia Pacific, Heinz’s net sales dropped 10.6% to $475.7m.
Heinz, now owned by Brazil-based private-equity firm 3G Capital and Warren Buffett’s Berkshire Hathaway fund, reported a 38.8% rise in gross profit to $916m as it reduced its cost of goods sold.
A further drop in SG&A costs, as well as the absence of expenses linked to the 2013 takeover of the business, led Heinz to book operating income of $409.1m. In the prior-year period, Heinz booked an operating loss of $9.5m.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataThe company posted a net income of $171.6m, versus a net loss of $11.8m a year earlier.
Since the takeover, Heinz’s new owners have looked to reduce costs and to improve the company’s efficiency. That has led the company to close five plants. As of 28 September, Heinz had cut 4,050 corporate and field positions across the business, excluding the impact of the factory closures, which has hit around 1,600 posts.
Last month, Heinz said another plant – in the UK town of Westwick – would shut after the end of its licence to manufacture Aunt Bessie’s frozen potato lines. The closure will affect another 200 staff.
