Kraft Foods' profit melts away in third quarter | RetailDetail

Kraft Foods' profit melts away in third quarter

Kraft Foods' profit melts away in third quarter

American Kraft Foods has seen its profits drop while turnover levels remained the same. "Our price policy strategy, based on raw materials, has proven to be successful up until now, but we have had flawed execution in other areas", CEO Tony Vernon admitted.

Higher prices, larger discounts

Kraft Foods' net profit dropped nearly 11 % compared to the year before, to 446 million dollars (350 million euro). Turnover remained level at 4.4 billion dollars (3.5 billion euro), slightly lower than analysts' expectations.

 

The company says it has managed to increase the price for more than 50 % of its product range to offset the increased cost of raw materials. The result was that, for some products, sales lagged behind. On top of that, in order to stimulate meal and dessert sales, the group was forced to hand out larger discounts and take a 6.7 % turnover hit in that branch. All in all, Kraft's gross margin reached 29.3 % in the previous quarter, down from 33.8 % the year before.

Questions or comments? Please feel free to contact the editors


Several candidates to take over Men at Work

12/07/2018

There are several takeover candidates for both the Dutch and the Belgian stores of the bankrupt clothing chain Men at work. The curator is confident an agreement should be reached today in Belgium.

Burberry sales increases thanks to new strategy

11/07/2018

The new strategy of the British fashion brand Burberry starts to render: the company had a 3% increase of revenue in their own stores last quarter. In total, Burberry has now a revenue of 479 million pounds (520 million euros).

FNG moves to Brussels stock exchange

06/07/2018

Belgian fashion group FNG has collected 60 million euros by issuing new shares. The new shares will be traded on the Amsterdam Stock Exchange and - for the first time - on the Brussels Stock Exchange as well.

Athleteshop ends its run

02/07/2018

Dutch sports web shop Athleteshop has filed for bankruptcy, after an abysmal year in which strings of complaints led to all sorts of problems. Social media and review sites were flooded with customers complaining about late deliveries.

Alibaba goes Turkish with stake in Trendyol

29/06/2018

Alibaba is the new strategic partner of Trendyol, one of the best-known e-commerce companies in Turkey. With this partnership, the Chinese retailgroup strengthens its presence in Europe.

Profits H&M Group take another hit

28/06/2018

Swedish fashion group Hennes & Mauritz has published a fourth consecutive quarterly turnover that was lower than expectations. The group that owns chains like COS, Monki and &Other Stories saw its profit drop by 21 %, despite a (slightly) higher turnover.