Kraft Heinz Company KHC reported a fourth-quarter FY24 sales decline of 4.1% year-on-year to $6.58 billion, missing the analyst consensus estimate of $6.66 billion.
Sales in North America declined 3.9% and International Developed Markets dropped 3.6%. Organic net sales slipped 3.1%.
Gross profit decreased by 3.1% to $2.24 billion, with the margin expanding 30 points to 34.1%. The operating income for the quarter plunged 103.1% to $(40) million.
Selling, general and administrative expenses, excluding impairment losses, declined 11.7% to $898 million. Adjusted EPS of $0.84 beat the consensus estimate of $0.78.
Kraft Heinz held $1.5 billion in cash and equivalents as of December 28. Operating cash flow for year totaled $4.2 billion, with a free cash flow of $3.2 billion.
As of December 29, 2024, the company had remaining authorization to repurchase approximately $1.9 billion of common stock under the publicly announced share repurchase program.
“Although 2024 was a challenging year with our top line results coming in below our expectations, we remained disciplined in protecting profitability while driving industry-leading margins, generating strong cash flow, and returning $2.7 billion in capital to stockholders,” said CEO Carlos Abrams-Rivera.
Kraft Heinz declared a regular quarterly dividend of $0.40 per share of common stock payable on March 28, 2025, to stockholders of record as of March 7, 2025.
Outlook: Kraft Heinz expects FY25 adjusted EPS of $2.63 – $2.74, below the consensus estimate of $3.04.
The company sees FY25 organic net sales to be down 2.5% to flat versus the prior year.
Price Action: KHC shares are trading lower by 4.90% at $28.13 at the last check Wednesday.
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Overview Rating:
Speculative
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