Kraft Heinz (NYSE:KHC) announced its earnings results on Monday. This Zacks Rank #4 (Sell) company is expected to save $1.5 billion in annual costs by the end of 2017 gaining from increased scale and possibly aggressive cost cuts. Sales slid 4.1 percent to $2.62 billion at Heinz, which didn’t have analysts’ estimates available for comparison.
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Shares of Kraft Heinz fell about 2% in afterhours trading on Monday.
“As we work to build something special at The Kraft Heinz Company, the leadership team has examined every aspect of our business to ensure we are operating as efficiently and effectively as possible”, Mullen wrote in an email. RBC Capital initiated coverage on Kraft Heinz in a research report on Tuesday, July 21st.
Kraft’s net income rose to $551m in the second quarter ended on 27 June from $482m in the previous year.
Heinz, meanwhile, reported separate results.
The combination of Pittsburgh-based Heinz and Kraft earlier this year was engineered by Warren Buffett’s Berkshire Hathaway and Brazilian investment firm 3G Capital, which has become known for its tight cost controls. The shares have underperformed the S&P 500 by 0.02% during the past week but The Kraft Heinz Company (NASDAQ:KHC) has outperformed the index in 4 weeks by 1.44%.
Alibaba Group Holding Limited (NYSE:BABA) stock price closed at $77.34 with the total traded volume of 22.8 Million shares.
At its office in Northfield, the company also stopped providing free Kraft snacks like Jell-O. For fiscal FIRST QUARTER 2016, GAAP net income grew 119% to $275.3 million, as compared to $125.4 million for fiscal FIRST QUARTER 2015.
As for the combined company itself, Kraft Heinz executives did not detail an outlook or provide any updates as to how the merged company will operate going forward. And while Heinz posted a net loss of $164 million, compared to a profit of $127 million in the year ago period, it did enjoy a nice improvement in gross margins, from 32% to 34.2%.
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In March, the two prominent businesses completed a merger that created the third largest food and beverage company in North America and the fifth largest in the world.
