[ad_1]
(NBC) – Kraft Heinz shares are expected to fall as markets open Friday after consumer goods company says it has been investigated by US regulators and announced a major loss .
Shares of the food company fell 20% Thursday night after posting a quarterly loss, revealed a SEC investigation and noted the value of its iconic brands Kraft and Oscar Mayer, highlighting the challenging context in which the company is located. packaged food industry.
The company's dismal results and forecasts, which is one of Warren Buffett's most important investments, reflect changes in consumption patterns from processed foods to healthier alternatives.
The collapse of late hours erased $ 12 billion from Kraft Heinz's stock market value and left its shares at their lowest since HJ Heinz Co bought Kraft Foods Group in 2015 to create the fifth-largest food and beverage company. of the world's drinks.
"Kraft Heinz's results have confirmed all our worst fears, and more," said Laurent Grandet, an analyst at Guggenheim Partners.
The $ 15.4 billion write-down reflects declining brand equity and other asset impairments, which means that the company believes these assets are worth less than before fusion.
"We plan to take a step back in 2019," said CFO David Knopf at a post-earnings teleconference, promising a "steady earnings growth" from 2020.
Kraft, which owns the brands of Velveeta cheese and Heinz ketchup, is forecasting adjusted earnings before interest, taxes, depreciation and amortization of $ 6.3 billion to $ 6.5 billion in 2019, lower than the $ 7.47 billion estimate analysts, according to Refinitiv.
Chief Executive Officer Bernardo Hees said the packaged food sector as a whole would still face a challenge due to the growing popularity of private labels and rising commodity prices.
"Kraft Heinz is in a worse situation than many other consumer goods companies because its brand portfolio is very small. They do not provide the level of growth needed on this type of market, "said Neil Saunders, Managing Director of GlobalData Retail.
Berkshire Hathaway Inc of Buffett and Kraft Heinz, based in Chicago and controlled by the Brazilian company 3G Capital.
In addition to lower than expected profits, the company announced that it had been summoned by the US Securities and Exchange Commission in October, as part of an investigation into its accounting policies, procedures and internal controls related to purchases.
The company said it was working on ways to improve its internal controls and determined that, to solve its problems, it had to record a $ 25 million increase in the cost of products sold.
"This has further compounded a bad set of results, as it has also created uncertainty," Saunders said.
[ad_2]
Source link