Kraft Foods, which has agreed to merge with H.J. Heinz in a deal orchestrated by Warren Buffett and 3G Capital, posted first-quarter revenue that trailed analysts’ estimates as sales of meals and desserts slid.
Revenue in the quarter fell 0.2 per cent to $4.35 billion, the Northfield, Illinois-based company said Tuesday in a statement. The average of analysts’ estimates compiled by Bloomberg was $4.43 billion.
Heinz and Kraft announced last month they would merge to form the third-largest food-and-beverage company in North America. While Kraft has a stable of household brands, the company has struggled to reignite growth as US consumers’ tastes change. Kraft was in the midst of a leadership shakeup in the months before the merger announcement, and the company suffered through a recall of its popular Macaroni and Cheese.
Sales in the company’s meals and desserts unit fell 2 per cent to $488 million in the quarter.
Kraft shares fell 2.2 per cent to $84.01 at 4:10 p.m. after regular trading closed in New York. The stock surged 36 per cent on 25 March, when the Heinz merger was announced.
Bloomberg News, edited by ESM
