Kraft Heinz Co raised its full-year core profit forecast following benefits from increased pricing and sustained demand for its packaged food even as COVID-19 curbs ease.
Kraft, like its peers Campbell Soup Co, Conagra Brands Inc and Unilever PLC, has been raising product prices in recent months to offset heightened inflation caused by raw material and labor shortages due to the pandemic.
It has further benefited from steady at-home dining trends that emerged during the pandemic despite the reopening of dine-in restaurants and bars.
The ketchup maker said it expects full-year adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) to be over $6.2 billion, above its previous estimate of at least $6.1 billion.
Net sales in the third quarter fell to $6.32 billion for the Jell-O maker from $6.44 billion a year earlier. Analysts on average had expected sales of $6.05 billion, according to Refinitiv IBES.
However, organic net sales increased 1.3% versus the prior year period and 7.6% versus the comparable 2019 period.
Excluding items, the packaged foods maker earned 65 cents per share, beating analysts' average estimate of 58 cents.
Net income increased 23.2% to $736 million, primarily driven by a $300 million non-cash goodwill impairment loss in the prior year period related to the Cheese Transaction, a lower effective tax rate versus the prior year period, and favorable changes in other expenses.
Adjusted EBITDA declined by 11.3% to $1.5 billion during the quarter and increased by 0.7% compared to the same period in 2019.
The company recently completed the acquisition of Assan Foods, announced in June of this year, from privately held Turkish conglomerate Kibar Holding. Assan Foods, a sauces-focused business with manufacturing facilities in Balikesir and Izmir, has been a certified Kraft Heinz production partner since 2019.