Kraft Earnings Cheat Sheet: Revenues Boost 11% Upward, Shares Rise

S&P 500 (NYSE:SPY) component Kraft Foods Inc. (NYSE:KFT) reported its results for the first quarter. Kraft Foods Inc. manufactures and markets packaged food products, including snacks, beverages, cheese and convenient meals.

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Kraft Foods Earnings Cheat Sheet for the First Quarter

Results: Net income for the food company fell to $799 million (45 cents/share) vs. $1.88 billion ($1.16/share) a year earlier. A decline of 57.6% from the year earlier quarter.

Revenue: Rose 11.1% to $12.57 billion YoY.

Actual vs. Wall St. Expectations: KFT reported adjusted net income of of 52 cents/share. By that measure, the company beat the mean estimate of 47 cents/share. Estimates ranged from 45 cents per share to 50 cents per share.

Quoting Management: “We’re off to a stronger-than-anticipated start to the year as our teams around the world execute our growth strategy,” said Irene Rosenfeld, Chairman and CEO. “Our business fundamentals are solid, and we continue to benefit from brand-building investments which allowed us to successfully deliver net pricing to offset commodities increases and drive top-tier growth. At the same time, we’re generating cost savings to reinvest in further growth and expand margins.”

Key Stats: The company has enjoyed double-digit year-over-year revenue growth for the past five quarters. Over that span, the company has averaged growth of 19.6%, with the biggest boost coming in the fourth quarter of the last fiscal year when revenue rose 24.9% from the year earlier quarter.

The company has now seen net income fall in each of the last four quarters. In the fourth quarter of the last fiscal year, net income fell 23.9% while the figure fell 8.5% in the third quarter of the last fiscal year and 13.3% three quarters ago.

Gross margins grew 0.7 percentage point to 36.9%. The growth seemed to be driven by increased revenue, as the figure rose 11.1% from the year earlier quarter while costs rose 9.8%.

Competitors to Watch: General Mills, Inc. (NYSE:GIS), J&J Snack Foods Corp. (NASDAQ:JJSF), Ralcorp Holdings, Inc. (NYSE:RAH), The Hain Celestial Group, Inc. (NASDAQ:HAIN), Kellogg Company (NYSE:K), ConAgra Foods, Inc. (NYSE:CAG), Inventure Foods, Inc. (NASDAQ:SNAK), TreeHouse Foods Inc. (NYSE:THS), PepsiCo, Inc. (NYSE:PEP), and Golden Enterprises, Inc. (NASDAQ:GLDC)

Stock Performance: Shares of KFT are up 1.53% after hours from today’s closing price of $33.39.


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