Heinz reports profit rise
MILWAUKEE — Food maker H.J. Heinz said Thursday that its fiscal first-quarter profit rose 11 percent, fueled by double-digit sales growth in North America and Europe.
The earnings offset a drop-off in Heinz's U.S. restaurant business, which is slowing on weaker consumer demand as people grapple with increasing food and fuel costs and eat more meals at home.
For the three months ending July 30, the Pittsburgh-based maker of Heinz Ketchup, Weight Watchers products and Ore-Ida potatoes said it earned $229 million, or 72 cents per share. That compares with a year-ago profit of $205.3 million, or 63 cents per share.
Revenue in the quarter rose 14 percent to $2.58 billion, an increase from $2.25 billion during the same period last year. Net pricing in the quarter, companywide, was up 5.2 percent as Heinz, like other food makers, raised prices to offset commodity cost increases.
The earnings beat the expectations of analysts. Thomson Reuters said analysts had expected earnings of 66 cents per share on revenue of $2.46 billion for the quarter.
Shares of Heinz rose 36 cents, or 0.7 percent, to $52.07 in morning trading Thursday.
Sales in the company's segments all grew except for the U.S. food service segment, which supplies food to restaurants and other businesses.
The segment was hurt as consumers continue to eat more at home because of the weakening U.S. economy, Heinz said. As a result, Heinz eliminated some of its products in the category and accounts that weren't contributing to profits.
