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Jul 01, 2023
Kraft Heinz Q2 2023 Earnings Report
Kraft Heinz's financial performance in Q2 2023 showed growth in net sales, profits, and profitability.
Key Takeaways
Kraft Heinz reported strong second-quarter results with growth in net sales, profits, and profitability, driven by its strategy to accelerate profitable growth across Foodservice, Emerging Markets, and U.S. Retail Grow Platforms, with a reiteration of the full-year outlook.
Net sales increased by 2.6%, and Organic Net Sales increased by 4.0%.
Gross profit margin increased by 337 basis points to 33.6%, while Adjusted Gross Profit Margin increased by 180 basis points to 33.3%.
Net income increased by 277.0%, and Adjusted EBITDA increased by 6.0%.
Diluted EPS was $0.81, up 285.7%, while Adjusted EPS was $0.79, up 12.9%.
Kraft Heinz
Kraft Heinz
Kraft Heinz Revenue by Segment
Kraft Heinz Revenue by Geographic Location
Revenue by Segment
North America Revenue
CapyFin.comRevenue by Geographic Location
North America Revenue
CapyFin.com Forward Guidance
For fiscal year 2023, the Company expects Organic Net Sales growth of 4 to 6 percent versus the prior year. Constant Currency Adjusted EBITDA growth of 4 to 6 percent versus the prior year, or 6 to 8 percent when excluding the impact from lapping a 53rd week in 2022. Adjusted Gross Profit Margin expansion is expected to contribute to Constant Currency Adjusted EBITDA growth. The Company now expects Adjusted Gross Profit Margin expansion of 150 to 200 basis points versus the prior year, as compared to the Company's previous expectation of 125 to 175 basis points. Adjusted EPS to be in the range of $2.83 to $2.91.
Positive Outlook
- Organic Net Sales growth of 4 to 6 percent.
- Constant Currency Adjusted EBITDA growth of 4 to 6 percent versus the prior year, or 6 to 8 percent when excluding the impact from lapping a 53rd week in 2022.
- Adjusted Gross Profit Margin expansion is expected to contribute to Constant Currency Adjusted EBITDA growth.
- Adjusted Gross Profit Margin expansion of 150 to 200 basis points versus the prior year.
- Adjusted EPS to be in the range of $2.83 to $2.91.
Challenges Ahead
- Adjusted EPS includes a negative impact of approximately $0.04 from expected unfavorable changes in non-cash pension and post-retirement benefits.
- Adjusted EPS includes a currency headwind of approximately $0.02 at current foreign exchange rates.
- The expected 2023 year-over-year Adjusted EPS change reflects a negative $0.06 impact from lapping a 53rd week in 2022.
- The Company continues to expect an effective tax rate on Adjusted EPS to be in the range of 19 to 21 percent.
- Mid-to-high single-digit inflation for the full year and low-to-mid single-digit inflation in the second half of the year.