Sales fall at Heinz as restructuring costs dig into profit

Share with others:


Print Email Read Later

The H.J. Heinz Co. saw sales fall 3.7 percent to $2.72 billion in the three months ended Oct. 27, according to a regulatory filing today.

Acquired in June by 3G Capital and Berkshire Hathaway, the Pittsburgh food company reported sales volume fell 1.5 percent as gains in emerging markets were more than offset by declines in developed markets such as the U.S. and Europe.

Hit with restructuring costs, profit from continuing operations attributable to Heinz was $38 million compared to $295 million the previous year.

After acquiring the company for more than $28 billion, new management at Heinz eliminated about 2,000 corporate and field positions globally as of Oct. 27. The restructuring and productivity initiatives, which included the announcement in November of plans to close three plants in North America, incurred pre-tax costs of $198.7 million during the most recent quarter, the company said.

Heinz said sales in its North American consumer product division dropped 5.9 percent, with volume down in Heinz gravy, Ore-Ida frozen potatoes and Smart Ones frozen entrees. In part, the drop followed changes in promotions.

In Europe, sales fell 3.2 percent, while sales fell 6.5 percent in the Asia/Pacific region. The U.S. food-service segment, which supplies restaurants and hospitals, fell 0.4 percent.

The Rest of World segment that includes emerging markets such as Brazil and Egypt saw sales rise 3.5 percent.

The company said some of the sales shifts came as it adjusted pricing and promotions. Foreign exchange rates also played a role.


Teresa F. Lindeman: tlindeman@post-gazette.com or 412-263-2018.

Join the conversation:

Commenting policy | How to report abuse
To report inappropriate comments, abuse and/or repeat offenders, please send an email to socialmedia@post-gazette.com and include a link to the article and a copy of the comment. Your report will be reviewed in a timely manner. Thank you.
Commenting policy | How to report abuse

Advertisement
Advertisement
Advertisement

You have 2 remaining free articles this month

Try unlimited digital access

If you are an existing subscriber,
link your account for free access. Start here

You’ve reached the limit of free articles this month.

To continue unlimited reading

If you are an existing subscriber,
link your account for free access. Start here