Chicago — Investments in people, technology and current production capacity will allow Kraft Heinz Co. to further expand into the foodservice category. The channel is a strategic priority for management and is expected to be a component of overall company growth in 2023.
Foodservice sales in North America and internationally account for about 14% of sales, according to the company.
Chairman and Chief Executive Officer Miguel Patricio said in a statement focusing on 2022 results: “We gained share in both zones and significantly outpaced industry growth.”
It’s the additional opportunities in this category that give management some optimism.
“…we are still only 25 of the top 50 QSRs[chains]in the US,” North America President Carlos A. Abrams Rivera said on an earnings call with securities analysts on Feb. 15. said. “So we know that everything we do remains an opportunity to drive even more growth.”
International Markets President Rafael de Olivera said consumer insights also play a key role.
“Keep in mind, we compete with local players many times, but having this global insight helps us test our innovations in the market and scale up to other markets. It makes a big difference in making it successful,” he said. “And we’ve built this model and replicated it consistently around the world, and it’s working really well.”
In May, US pouch manufacturing capacity will increase another 25% and Dip & Squeeze capacity will increase 50% to support foodservice growth.
Patricio said: “We haven’t penetrated enough and expect continued strong results in 2023.”
Kraft Heinz Co.’s net income for the fiscal year ended December 31, 2022 surged to $2.4 billion, equivalent to $1.93 per share of common stock, compared with 10 cents per share in the prior year. increased from $100 million.
Items impacting profitability included lower debt extinguishment charges in the prior year and lower non-cash impairment losses in the current year, the company said.
Annual sales increased from $26 billion in 2021 to $26.5 billion. Sales were impacted 8% by divestitures and acquisitions and 2% by currency.
Organic sales increased 10% year-over-year. Price increases drove organic sales growth, with volume/mix down 3% year over year.
Like many other food manufacturers, Kraft Heinz continues to struggle to improve its service levels.
“The operating environment is improving, but it is not clear yet,” Patricio said. We continue to act swiftly.
“This is reflected in our case fill rate (CFR). From the beginning of the year to the third quarter, the US CFR was slightly below 90%. , at the end of December we were at the highest level of the year, but we are still not at the level we need to reach our goal of returning to the late 90s.”
In North America, annual sales were flat at $20.3 billion. International sales increased him 8% to $6.2 billion.
“As previously emphasized, our portfolio of iconic brands is well-balanced and our market share by consumer base is not overly dependent on any particular income level,” Patricio said. . “Compared to the beginning of the year, we saw year-over-year market share improvements across all income levels. is his 13% increase.”