Kraft Heinz Co. posted fourth-quarter sales and earnings above Wall Street expectations on Wednesday, boosted by higher product prices and sustained demand for its packaged foods and condiments.
Packaged food makers have been bumping up prices of their products to contend with surging costs of everything from shipping and labor to raw materials such as wheat, meat, and edible oils.
Kraft has benefited significantly from robust demand for its snacks and other consumables during the pandemic, before which it struggled with weak sales and wrote down the value of several brands by billions of dollars over the past few years.
The Chicago-based company, whose brands include Philadelphia Cream Cheese and Heinz ketchup, said it pushed prices 3.8 percentage points higher in the reported quarter.
The reopening of restaurants and colleges after the easing of COVID-19 restrictions also helped boost Kraft’s foodservice business back to pre-pandemic levels, the company said.
Kraft also said it expects full-year organic sales to grow by a low-single-digit percentage, compared with a 1.8 percent rise in 2021, sending shares of the company up 1.9 percent before the bell.
The company reported a net loss attributable to common shareholders of $257 million, or 21 cents per share, mainly due to non-cash impairment losses of $1.3 billion. It reported a net income of $1.03 billion, or 84 cents per share, a year earlier.
Excluding items, Kraft earned 79 cents per share, beating analysts average estimate of 63 cents.
Net sales fell to $6.71 billion in the fourth quarter ended Dec. 25, from $6.94 billion a year earlier, owing to an impact from acquisitions and divestitures. Analysts on average had expected sales of $6.61 billion, according to Refinitiv IBES.
