Research Desk Line-up: Blue Buffalo Pet Products Post Earnings Coverage
LONDON, UK / ACCESSWIRE / August 21, 2017 /Pro-Trader Daily has just published a free post-earnings coverage on The Kraft Heinz Co. (NASDAQ: KHC), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=KHC, following the Company's disclosure of its second quarter fiscal 2017 operating results on August 02, 2017. The fifth-largest food and beverage Company in the world outperformed earnings expectations. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:
Get more of our free earnings reports coverage from other constituents of the Food - Major Diversified industry. Pro-TD has currently selected Blue Buffalo Pet Products, Inc. (NASDAQ: BUFF) for due-diligence and potential coverage as the Company announced on August 08, 2017, its financial results for Q2 2017. Register for a free membership today, and be among the early birds that get access to our report on Blue Buffalo Pet Products when we publish it.
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For the three months ended July 01, 2017, Kraft Heinz's net sales were $6.67 billion, down 1.7% compared to sales of $6.79 billion in Q2 2016, including an unfavorable 0.8% impact from currency. Kraft Heinz's revenue numbers fell short of analysts' estimates of $6.69 billion of sales.
During Q2 2017, Kraft Heinz's adjusted EBITDA increased 0.7% to $2.1 billion on a y-o-y basis, despite an unfavorable 1.2% impact from currency. Excluding the impact of currency, the increase in adjusted EBITDA reflected incremental gains from cost savings initiatives.
Kraft Heinz's net income attributable to common shareholders increased to $1.16 billion and diluted EPS increased to $0.94 compared to net income of $770 million, or diluted EPS of $0.63, primarily driven by lower integration program and restructuring costs, benefits from the refinancing of Series A Preferred Stock, and a lower effective tax rate. The Company's adjusted EPS increased 15.3% to $0.98 on a y-o-y basis, primarily due to benefits from the refinancing of Series A Preferred Stock and lower taxes. Kraft Heinz's earnings exceeded Wall Street's expectations of $0.96 per share.
Kraft Heinz's Segment Results
United States - During Q2 2017, the United States segment's net sales totaled $4.6 billion, down 1.2% on a y-o-y basis. The segment's pricing decreased 0.4% reflecting timing of trade promotion recognition in the prior year. Volume/mix decreased 0.8% as the benefit from a shift in Easter-related sales as well as gains in frozen, macaroni and cheese, and condiments and sauces, more than offset by select distribution losses in cheese and meats as well as lower shipments in food service.
For Q2 2017, the United States segment's adjusted EBITDA rose 3.2% to $1.6 billion, driven by gains from cost savings initiatives that were partially offset by unfavorable key commodity costs, particularly in cheese and coffee, as well as lower net sales.
Canada -During Q2 2017, Canada region's net sales were $597 million, down 6.4% on a y-o-y basis, including a negative 3.3% impact from currency. The segment's organic net sales decreased 3.1% versus the year-ago period, while pricing decreased 3.7% primarily due to an increased level of promotional activity versus the prior year. Canada's volume/mix increased 0.6%, reflecting growth in condiments and sauces.
For Q2 2017, Kraft Heinz's Canada segment's adjusted EBITDA dropped 1.2% to $189 million, including an unfavorable 3.5% impact from currency. Excluding the impact of currency, the segment's adjusted EBITDA increased 2.3% driven by gains from cost savings.
Europe - During Q2 2017, Europe segment generated net sales of $595 million, down 4.9% on a y-o-y basis, including a negative 4.1% impact from currency. Pricing decreased 1.6% due to changes in promotional spending levels, while volume/mix increased 0.8% driven by strong consumption gains in condiments and sauces and gains in foodservice, partially offset by shipment timing as well as ongoing consumption weakness in Italy.
For Q2 2017, Kraft Heinz's Europe segment's adjusted EBITDA fell 8.6% to $202 million on a y-o-y basis, including a negative 6.2% impact from currency.
Rest of World - During Q2 2017, the Rest of World's net sales were $851 million, growing 1.6% on a y-o-y basis, despite an unfavorable currency impact of 1.4%. The segment's organic net sales grew 3.0% on a y-o-y basis. Kraft Heinz's Rest of World pricing increased 3.7% primarily driven by actions to offset higher input costs in local currency, particularly in Latin America. Volume/mix was 0.7% lower as strong growth in condiments and sauces was more than offset by a combination of significantly lower shipments in India, unfavorable holiday-related shipment phasing in Indonesia, as well as the impact of distributor network realignment in several markets.
For Q2 2017, the Rest of World segment's adjusted EBITDA decreased 11.6% to $180 million on a y-o-y basis, including an unfavorable 3.0% impact from currency.
On August 03, 2017, Kraft Heinz announced that its Board of Directors approved an increase in the Company's quarterly dividend to $0.625 per share of common stock, or $2.50 per share of common stock, on an annual basis. This represents an increase of approximately 4.2 % versus the prior quarterly dividend rate of $0.60 per share, or $2.40, on an annual basis. The dividend declared is payable on September 15, 2017.
On Friday, August 18, 2017, Kraft Heinz's stock closed the trading session at $84.49, slightly slipping 0.73% from its previous closing price of $85.11. A total volume of 2.83 million shares were exchanged during the session. Shares of the Company have a PE ratio of 27.04 and have a dividend yield of 2.96%. The stock currently has a market cap of $103.69 billion.
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