Kraft Heinz Co (NASDAQ:KHC, ETR:KHNZ) has warned its recovery in the US will take longer than expected after underwhelming against revenue expectations over the third quarter.
Net sales fell by 2.8% to $6.38 billion over the three months to September, the ketchup maker reported on Wednesday, undershooting estimates for $6.43 billion.
This came as revenue in the US dipped by 3.4%, while sales across international developed and emerging markets fell by 0.2% and 2.4% respectively.
“When we look at our US retail business, we are expecting more of an elongated recovery, driven by specific categories that continue to experience pressure,” CEO Carlos Abrams-Rivera commented.
Operating income plummeted 115% to a $101 million loss, which Heinz attributed to a $1.4 billion non-cash impairment relating to its Lunchables brand and goodwill payments in Europe.
Excluding this, adjusted operating income ticked up 1.4% to $1.33 billion, with adjusted earnings per share climbing 4.2% to $0.75, ahead of anticipations for $0.74.
“While a recovery is taking longer than originally anticipated, we are not losing sight of our long-term strategy,” Abrams-Rivera added.
“We remain confident in our ability to drive profitable growth, generate strong cash flow, and return capital to our stockholders.”
Shares fell by 3% ahead of Wednesday’s opening bell.