Heinz chairman points to strength during recession

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H.J. Heinz Co. Chairman William R. Johnson presided over an amiable gathering of about 200 shareholders this morning at company's annual meeting at the Westin Convention Center Hotel, Downtown.

Mr. Johnson noted that the Pittsburgh food company had continued to raise its dividend, along with producing strong sales and profits, in a year when a global recession hit hard.

And a representative of a union that both owns shares and represents some Heinz employees stood up to thank the company's board and management for being a bright spot in a depressing year. "These results are not an accident," said Bill Dempsey, of the United Food and Commercial Workers.

In the fiscal year ended April 29, Heinz reported sales of more than $10.1 billion and a 9.2 percent increase in profit to $923 million.

Mr. Johnson reiterated projections for sales growth of 4 percent to 6 percent and earnings-per-share growth of 5 percent to 8 percent in the next fiscal year, on a constant currency basis. Heinz is anticipating that a stronger dollar and foreign currency volatility will be an issue in its results this year.

The Heinz chairman said global economic pressures have seen consumers shifting more toward eating at home, shopping at discount stores and buying private label products. The last trend could create an issue for the company but Mr. Johnson didn't seem too concerned.

"While consumers around the world have changed their behavior in response to economic concerns, they remain loyal to Heinz brands because we deliver quality, nutrition, innovation, convenience and value," he said in his speech to shareholders. "They trust our company's brands, as they have for 140 years."

Meanwhile, shareholders voted to re-elect the company's 12 board members, including activist investor Nelson Peltz. They also backed a change in the company's by-laws to permit holders of 25 percent of the voting power of the outstanding shares to call a special meeting of shareholders.

Heinz is scheduled to release first-quarter results next week.

At mid-morning, the company's shares were trading at $38.43, up 33 cents.

Teresa F. Lindeman can be reached at tlindeman@post-gazette.com or at 412-263-2018.


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