Kraft Heinz Profit Down - Update

(RTTNews) - Kraft Heinz Co. (KHC), the merged business of packaged foods maker Kraft Foods and ketchup maker H.J. Heinz, Thursday reported a drop in profit for the third quarter, as sales declined.

Kraft Heinz' third-quarter net loss was $303 million or $0.27 per share compared to $8 million or $0.02 per share last year.

On a pro forma basis, Kraft Heinz's third-quarter profit dropped to $12 million from $608 million a year. Pro forma basis reports consolidates results as if the companies had been merged in both periods.

On a per-share basis, which includes the impact of preferred dividends, pro forma loss was $0.14, compared to earnings of $0.35 a year ago. Adjusted pro forma earnings rose to $0.44 per share from $0.46 per share last year.

Pro forma net sales for the quarter dropped to $6.36 billion from $6.99 billion last year.

Commenting on the results, CEO Bernardo Hees said, "Our third quarter results reflect continued progress as we integrate these two great companies while driving greater accountability, discipline and efficiency."

This is for the first time that Kraft Heinz has reported its earnings results after the completion of its merger in July.

Kraft Heinz, the third-largest food and beverage maker in North America, is struggling to improve its profitability by lowering costs amidst sluggish sales as more and more consumers now prefer, health, fresh and organic foods to packaged foods.

The company plans to cut $1.5 billion in annual expenses by the end of 2017. Kraft Heinz has announced job cuts of about 5,100 employees, or over 10 percent of its workforce, since the merger closed in July.

The company was created through the merger of Kraft Foods and H.J. Heinz, a deal that was engineered by Heinz owners 3G Capital Partners and Berkshire Hathaway Inc.'s Warren Buffett.

Further, Kraft Heinz raised its quarterly dividend by 4.5 percent to 57.5 cents per share.

KHC closed Thursday's trading at $75.42, down $0.40 or 0.53%, on the NYSE. The stock further dropped $1.12 or 1.49% in the after-hours trade.