The business was taking longer than anticipated to recover, with negative rhetoric surrounding its Lunchables brand weighing on the business, according to company executives.
This is despite Kraft Heinz outlining a strategy in the summer to grow the brand’s sales after claims of lead contamination in April.
“In the third quarter, our top-line performance across two of our strategic pillars, Global Away From Home and Emerging Markets, grew in line with our expectations,” said Kraft Heinz CEO Carlos Abrams-Rivera.
Big food business’s Q3 result
“As we look forward, we are expecting continued momentum in these two pillars. When we look at our US Retail business, we are expecting more of an elongate recovery, driven by specific categories that continue to experience pressure.”
Kraft Heinz’s third-quarter financials weigh under those of Unilever, Danone and Mondelēz International, which this month each published unexpected growth – driven by volume.
Net sales drooped 2.8% to $6.8bn, slightly under the business’s $6.42bn estimates. North America organic sales slipped 3.2%, while retail was lower but partially offset by Away From Home.
International developed markets also dropped at 2.4%, a reflection of weaker volumes down 2.3%.
Kraft Heinz strategy to grow
Emerging markets, however, increased sales 4.6% with pricing up 3.3% to drive that.
The business would nevertheless continue to invest in marketing, research and development and technology to drive new solutions to market, Abrams-Rivera confirmed.
“We are supporting these investments by our proven ability to sustainably unlock efficiencies and generate strong cash flow,” he said.
“While a recovery is taking longer than originally anticipated, we are not losing sight of our long-term strategy. We remain confident in our ability to drive profitable growth, generate strong cash flow, and return capital to our stakeholders.”