Vending

Kraft Heinz lifts Q2 2022 earnings, raises FY expectations

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July 27, 2022

Kraft Heinz boosted its Q2 2022 earnings against the prior year period despite a slight sales decline, according to a press release. The company also raised its full year expectations.

Highlights include:

• Net sales decreased 0.9% from $6.615 billion in Q2 2021 to $6.55 billion in the quarter ending June 26, 2022, including a negative 9.3 percentage point impact from divestitures net of acquisitions and a negative 1.7 percentage point impact from currency.
• Organic net sales increased 10.1% versus the prior year period. Pricing was up 12.4 percentage points versus the prior year period with growth in both reportable segments that was primarily driven by price increases to mitigate rising input costs.
• Net income increased 1,136.4% from a $25 million loss to $265 million in the comparative quarters, primarily driven by lower tax expenses in the current year period, lower interest expense primarily due to debt extinguishment costs in the prior year period, and favorable changes in other expense areas.
• Diluted EPS improved 1,150% from a 2-cent loss to 21 cents.
• Adjusted EPS fell 10.3% from 78 cents to 70 cents, primarily driven by lower adjusted EBITDA, including a negative 7-cent impact from divestitures and higher taxes on adjusted earnings.

Shares traded today at $36.07 against a 52-week range of $32.79-$44.87.

The $6.55 billion in quarterly revenue beat analyst expectations by $190 million, while the non-GAAP EPS of 70 cents beat expectations by 2 cents, according to Seeking Alpha.

The company declared a 40 cent dividend in line with expectations, payable Sept. 23 for shareholders of record Aug. 26.

"We delivered yet another quarter of strong results as we continue to successfully navigate near-term headwinds, enabled by further advancements of our long-term strategy," Kraft Heinz CEO and Chairman Miguel Patricio said in the press release. "We are anticipating and adapting to changing market conditions while managing inflation through pricing realization and gross efficiencies."

The company is raising expectations for 2022 organic net sales to a high-single-digit percentage increase versus the prior year period, as compared to previous expectations of a mid-single-digit percentage increase, reflecting strong performance to date and ongoing business momentum.