US food giant H J Heinz has posted higher quarterly earnings, reflecting good sales growth.
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The company reported net income of US$199.0m, or 56 cents per share, for the second quarter to 27 October, compared to $191.5m, or 54 cents per share, for the second quarter of the previous year.
Heinz said its positive earnings performance reflected strong second-quarter sales growth of 5.2%, driven by a combination of favourable foreign exchange rates and a 0.5% increase in volume/mix. Second-quarter sales were $2.20bn, compared to $2.09bn a year earlier.
The company said the volume/mix improvement was driven mainly by strong volume growth of 3.4% in its North American Consumer Products business, primarily in frozen brands such as Ore-Ida frozen potatoes and Delimex snacks.
Net pricing lowered sales by 0.1%, as pricing improvements in the company’s North American Consumer Products and US Foodservice segments were offset by a $21.1m charge for trade spending for the Italian infant nutrition business. Pricing for the quarter was also unfavourably impacted by market pressure in the Netherlands and the Tegel poultry business in New Zealand.
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By GlobalData“During the second quarter, Heinz continued to make progress as we built on our Four Imperatives of driving profitable growth, removing clutter, squeezing out costs and measuring and recognising performance,” said chairman, president and CEO William Johnson.
