Reuters: Global Markets: Kraft affirms outlook, shares rise

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Kraft affirms outlook, shares rise Nov 7th 2012, 14:26 Tweet Share this Email Print Related News Facebook mobile revenue grows faster than expected Tue, Oct 23 2012 UnitedHealth posts higher profit, but outlook cautious Tue, Oct 16 2012 Analysis & Opinion Procter & Gamble earnings give CEO McDonald some relief Related Topics Investing Simplified » Hot Stocks » Asian Markets » Kraft Macaroni and Cheese is displayed at the company's headquarters in Northfield, Illinois February 10, 2009. Credit: Reuters/John Gress Wed Nov 7, 2012 9:26am EST (Reuters) - Kraft Foods Group Inc (KRFT.O) reported higher third-quarter profit on Wednesday and stood by its full-year outlook despite little improvement in the economy, and its shares rose 1.5 percent in premarket trading. Kraft said that because of the weak economy it must drive sales volume with more advertising and a greater range of products and prices. Kraft, which was spun off last month from the company now called Mondelez International (MDLZ.O), calls this a "good, better, best" strategy. "You have to be able to offer price points and innovation in all segments," said Kraft Chief Executive Tony Vernon. He said specific areas needing improvement were Maxwell House coffee, Planters nuts and Jell-O. "The economic environment has not improved and that creates a burning platform for Kraft, our customers and our industry," Vernon said. Kraft said net income rose to $470 million, or 79 cents per share, from $417 million, or 70 cents per share, a year earlier. Revenue increased 3 percent to $4.61 billion. Most of the increase was due to volume gains and selling a more expensive mix of products, with a smaller contribution from price increases. The company affirmed its 2013 outlook, calling for earnings of $2.60 per share and revenue growth in line with the rest of the North American food and beverage market. Kraft said revenue in the current fourth quarter would be flat to down due to a comparison with the year-earlier period when retailers increased orders in advance of a price increase. In addition, Kraft will lose sales from some products that it pruned from its portfolio. It said retailers would be working down higher inventories built up during the latest third quarter, ahead of the spin-off from Mondelez, which sells Cadbury chocolate and Oreo cookies. Mondelez is due to report earnings later on Wednesday. Kraft shares rose to $45.38 in premarket trading, from Tuesday's close at $44.70 on the Nasdaq. (Reporting by Martinne Geller in New York; Editing by Jeffrey Benkoe) Related Quotes and News Company Price Related News Tweet this Link this Share this Digg this Email Reprints We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/ Comments (0) Be the first to comment on reuters.com. Add yours using the box above.

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