The H.J. Heinz Co. plans to push its products even harder in the second half of the fiscal year, increasing its marketing budget to combat intense competition in the frozen food and condiments aisles as well as pressures from private label rivals.

William R. Johnson, Heinz chairman, president and CEO, said yesterday that consumers continue to be intensely focused on bargains.

But he also said the market seems to be stabilizing and that makes this a good moment to invest in gaining market share.

"The market is a little more receptive now. There's no point in chasing consumers out the door. I think that's a waste of money," Mr. Johnson said in a conference call with analysts.

The Pittsburgh food company yesterday reported a net profit of $231 million, or 73 cents per share, in the second quarter, down from $276.7 million, or 87 cents per share, in the same period a year ago.

Currency shifts boosted last year's results.

Analysts polled by Thomson Financial had been looking for 70 cents per share in this year's second quarter, which ended Oct. 28

The company's total sales grew 2.5 percent to $2.67 billion vs. $2.6 billion last year, driven by strong growth in markets such as India, Latin America and the Asia-Pacific regions.

Sales in the North American consumer products segment fell 4.3 percent and those in the U.S. Foodservice segment sales were flat.

Heinz sales reach around the globe means shifts in exchange rates can have a significant impact on reported results. Factoring out the impact of currency issues, the company said sales in the quarter grew 3.5 percent, operating income by 10.2 percent and earnings per share by almost 16 percent.

During the quarter, Heinz also completed the sale of a private label frozen dessert business in the United Kingdom and the sale of its Kabobs frozen hors d'oeuvres business. Mr. Johnson said the company acquired a small Canadian chilled smoothies business this week.

For the full fiscal year ending April 28, Heinz is now projecting earnings per share in the range of $2.72 to $2.82, up from earlier guidance in the range of $2.60 and $2.70. Analysts had been looking for $2.75.

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