[ad_1]
By Richa Naidu and Siddharth Cavale
CHICAGO (Reuters) – Investors criticize Kraft Heinz Co for failing to present a comprehensive strategy on how it plans to face competition in the vegetable protein market, which is rising. at about $ 3 billion a year.
At Kraft Heinz's annual meeting in Pittsburgh on Thursday, shareholders will vote on a proposal asking the company to reveal its long-term strategy for artificial meat and protein alternatives.
The products of rivals Beyond Meat Inc. and Impossible Foods have become the most popular food trend in recent years and are increasingly popular with traditional consumers looking to reduce their meat consumption.
"It's a fast growing market and they've been very quiet with investors about how they plan to tackle it," said Kyle Kempf, spokesperson for Green Century Funds, which said voted by proxy and holds a stake of over $ 460,000 in Kraft. Heinz.
Kraft Heinz has been ranked among the world's leading and least proactive food manufacturers in the vegetable protein market, according to FAIRR, a major investor coalition comprising several shareholders of Kraft Heinz. The company's main alternative meat brand, BOCA Burger, 40, has lost market share since 2013.
"Any company at the bottom of the hierarchy has a long way to go," said Peter van der Werf, head of responsible investment management at Robeco, which holds a $ 9.6 million stake in Kraft Heinz.
Robeco and another Kraft Heinz investor, NN Investment Partners, told Reuters that they were willing to support investor demand that Kraft Heinz provide more information about its alternative protein strategy. Neither company will indicate whether it will vote for the proposal, which Kraft Heinz's board recommended rejecting.
Kraft Heinz, which made a $ 15.4 billion write-down this year on its Kraft and Oscar Mayer brands, has been criticized for over-investing in innovation and marketing after years of declining inventories. Costs under the leadership of 3G Capital, the number two shareholder of Kraft Heinz. Since the write-down, the company's shares have fallen by about 40%.
BOCA LOSES SIZZLE BOCA Burger, considered by some to be the most original American vegetable, was purchased by Kraft Foods at the time in 2000. A problem for BOCA Burger, though aging, is that the current trend in meat is driven not by vegetarians, but by so-called flexitarians – meat eaters who occasionally buy protein-based products. To appeal to these buyers, Beyond Meat and others who have made the move are pushing grocers to stock their products alongside animal-like burgers in cold meat crates.
BOCA burgers, on the other hand, are frozen and seated in refrigerators with vegetarian and vegan products, where meat eaters may not think of looking.
Kroger Co, one of the first grocers to sell Beyond Meat cookies in crates, said Tuesday that he was testing a section of herbal protein in the meat aisles of 60 stores to evaluate consumer behavior.
BOCA Burger's share of the US plant-based hamburger market declined to 3.8% last year, down from 7.3% in 2013, according to Euromonitor.
Kraft Heinz refused to provide details on its plant protein projects or to comment on the upcoming shareholder vote. Kraft Heinz said in a statement that several named executives had lost their bonuses for 2018 because of the company's performance. Managing Director Miguel Patricio, who took the helm in July, said last month that the company needed to better understand consumers and was "far behind the plant market."
Spokesperson Lynne Galia said Kraft Heinz has increased sales of BOCA over the past year, as a result of changes in the taste, texture and packaging of its products. "We are committed to ensuring that our BOCA products maintain significant competitive claims over meat products, as well as competing claims in the category as it evolves," said Galia.
But the new boxes of BOCA do not have the buzzword "herbal" and tout an "All American Veggie Burger" at a time when their rivals are attracting meat eaters by avoiding terms such as " vegan "or" vegetarian ".
Faryda Lindeman, senior investment specialist at NN Investment Partners, said large companies such as Kraft Heinz, which had lagged the power plant market, were probably determined and did not want to invest in new risks. NN Investment holds a $ 9.4 million stake in Kraft Heinz. "The only thing to do is buy other companies of course, they have a lot of money," Lindeman said. 3G Capital is known to have signed large mergers and acquisitions contracts to drive growth, but Kraft Heinz's new CEO, Patricio, said when he was appointed in April that his goal was to develop existing brands.
(Report by Richa Naidu in Chicago and Siddharth Cavale in Bengaluru, additional report by Tina Bellon in New York Edited by Vanessa O. Connell and Matthew Lewis)
[ad_2]
Source link