Kraft Heinz this week reported financial results that echoed what other food & beverage processors are reporting, with one exception: the CEO sees no need for more price increases this year.
“From a pricing perspective, 99% of all needed pricing has already been announced for 2023,” Chairman & CEO Miguel Patricio told analysts in a teleconference after the financials were released. “As we look to the rest of the year, we have no current plans to announce new pricing” in all of the company’s markets.
But the fourth quarter and full-year numbers did resemble what other processors are reporting: higher sales fueled by price increases, with volume down.
Sales were up 10% in the fourth quarter alone but increased only 1.7% for the full company in all of 2022, to $26.5 billion (all results were aided by a 53rd week). International sales were the star, up 8% to more than $6 billion while North American sales actually dipped 0.1%. Net income was up nicely, to $2.37 billion, more than double the 2021 figure.
Pricing increased 13.2 percentage points versus the prior year period, “primarily driven by price increases to mitigate rising input costs,” according to a written report. “Volume/mix declined 3.4 percentage points versus the prior year period … primarily driven by supply constraints and elasticity impacts from pricing actions.”
The company expects 2023 organic net sales growth of 4-6% with high single-digit inflation for the year.
