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NORTHFIELD, Ill. Kraft Foods experienced an increase in its net revenue, thanks to its acquisition of Cadbury earlier this year and solid growth among key brands.
Net revenue in the second quarter increased 25.3% to $12.3 billion for the overall corporation, including a favorable impact of 22.8 percentage points from the Cadbury acquisition, 0.8 percentage points from currency and a negative 0.3 percentage point impact from divestitures. Operating income increased 16.8% to $1.7 million.
Meanwhile, Kraft said net revenue for its North America division increased by 6.3%, including a 6.9 percentage point impact from the Cadbury acquisition and a favorable 1.6 percentage point impact from currency, although base business performance was affected by a two percentage point decline in volume/mix and essentially flat price levels.
But while certain factors offset the benefits of investments in marketing and innovation -- which drove solid growth in base consumption in key brands, including Capri Sun, Ritz crackers and Oreo cookies, among others -- Cadbury growth reflected strong gains from successful new product launches of Trident Layers, Stride Shift and Dentyne Pure gum, Kraft said.
“We delivered strong earnings in the quarter and the first half of the year, despite difficult conditions in many markets that tempered top-line growth,” said Irene Rosenfeld, chairman and CEO. “We’re making excellent progress on the Cadbury integration and expect to realize even greater synergies. In light of our strong earnings momentum, we will reinvest our 2010 upside to build our brands and to harmonize business practices. We will deliver at least $2 of operating EPS this year while building a stronger foundation to achieve top-tier growth in 2011.”