Kraft Heinz reported a drop in sales and profit for its first quarter since the food giant was created in a merger orchestrated by billionaire Warren Buffett and 3G Capital.
Third-quarter revenue fell 9 per cent to $6.36 billion when measured to include comparable results from a year earlier, the company said Thursday in a statement. Excluding some items, profit was 44 cents a share in the period, down 4.3 per cent.
Kraft Heinz, the third-largest food and beverage maker in North America, is struggling with shrinking demand for packaged foods, underscoring the need to reduce costs. The company has said it will cut $1.5 billion in annual expenses by the end of 2017.
The company is “driving greater accountability, discipline and efficiency,” Chief Executive Officer Bernardo Hees said in the statement.
This is the first time that Kraft Heinz has reported earnings for the combined company. In August, it released second-quarter sales numbers for Heinz and Kraft Foods Group that also showed declining revenue at each business.
Heinz completed its merger with Kraft in July. Buffett and 3G Capital, the private-equity firm founded by Brazilian billionaire Jorge Lemann, previously teamed up to take Heinz private in 2013. 3G slashed costs at the ketchup maker and now it’s taking that same belt-tightening approach to Kraft, which has announced factory closings and more than 5,000 job cuts.
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