Food multinational Kraft Heinz was able to raise its prices by more than 15 % last year, but volumes fell as a consequence. For this year, the manufacturer plans no further price increases.
Hitting the ceiling?
Kraft Heinz published better-than-expected results for the fourth quarter of the past financial year: revenue rose 10 % to 7.38 billion dollars (6.9 billion euros), while net profit climbed to 890 million dollars (800 million euros), compared with a loss of 257 million dollars a year earlier.
The strong figures are due to hefty price increases averaging as much as 15.2 %, which more than offset a 4.8 % drop in volume. Still, prices seem to have reached their ceiling now: the manufacturer points out that more consumers are looking for cheaper alternatives. “As we look to the rest of the year, we have no current plan to announce new pricing in North America, Europe, Latin America and most of Asia”, CEO Miguel Patricio said.
Kraft Heinz therefore expects a slightly lower profit in 2023 as costs for raw materials remain high. Earlier, FMCG multinationals such as PepsiCo, Coca-Cola, Unilever and Carlsberg also came out with cautious forecasts for the current financial year, as consumers threaten to drop out due to high inflation.