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Heinz To Shut More Plants

By square1
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Heinz To Shut More Plants

Heinz has announced plans to shut down a number of factories, after posting weak results for its Q2. Heinz will close three factories; this follows on from the five factories it closed previously due to poor performance. “After two years of favourable profit trends, this year is clearly proving difficult,” said Heinz CEO William Johnson. 

“We are being challenged by significant increases in commodity costs, promotional price pressure and non-branded back-of-house products and a lag in price realisation at national accounts as well as a downturn in traffic at key customers.” Net profit for the second quarter fell by 5.4 per cent to $237 million, although revenue rose by 8 per cent to $2.83 billion. Volumes were down by 2 per cent in Europe and the US and Europe; there was a 5 per cent decrease in the Asia-Pacific region. 

 

Heinz said its price increases had led to the fall in sales volumes. The group has left its earnings forecast unchanged for the full year. (28 Nov)

 

© 2011-ESM:European Supermarket Magazine

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