Kraft Foods Group Inc. (KRFT), the North American grocery business reporting its first results after separating from the snacks enterprise, posted third-quarter revenue that beat analysts’ estimates, helped by higher prices and stronger sales of cheese.
Net income rose 13 percent to $470 million, or 79 cents a share, from $417 million, or 70 cents, a year earlier, the Northfield, Illinois-based company said today in a statement. Sales rose 3 percent to $4.61 billion, topping the $4.55 billion average of estimates compiled by Bloomberg. Kraft also reiterated its 2013 earnings forecast of $2.60 a share.
The original Kraft Foods Inc., founded in 1909, split into two companies last month, allowing its international snacks business, called Mondelez International Inc. (MDLZ), to push products into emerging markets and make acquisitions. At the same time, Kraft Foods Group Chief Executive Officer Tony Vernon is working to expand the slower-growing grocery business in the U.S. by boosting marketing spending and research.
“Kraft will benefit from solid top-line growth execution, but it will also benefit from the strong margin expansion opportunity inherent in the business,” Christopher Growe, an analyst at Stifel Financial Corp. in St. Louis, said today in a note.
Kraft Foods Group, whose products include fresh shredded cheese, packaged meals, beverages and coffee, fell 0.3 percent to $44.57 at the close in New York.
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