Kraft Heinz Co. is making more of its products that include ketchup and macaroni and cheese, which remain in high demand a year into the coronavirus pandemic.
The food giant on Thursday said profit and revenue for the latest quarter topped expectations, as cost cuts and higher prices offset higher shipping and commodity costs. Kraft Heinz said it is expanding manufacturing capacity for some of its best-selling foods because some of its businesses are still facing capacity constraints and can’t keep up with demand.
“Even though we expect to be operating in a very unpredictable environment for some time, we are showing even stronger momentum than anticipated,” Chief Executive Miguel Patricio said on a conference call.
Shares rose 2% Thursday morning.
Demand for groceries has been slowing in recent months compared with last year, when people flooded grocery stores at the onset of the coronavirus pandemic. Kraft Heinz’s comparable sales rose 2.5% in the latest quarter, but the company said it expects that measure to decline in the current quarter versus a year ago.
Chief Financial Officer Paulo Basilio said Kraft Heinz will be pressured by higher costs and a shift in where people buy food as the economy reopens, but it is working to keep younger and more diverse shoppers it gained during the pandemic.
Kraft Heinz reported adjusted earnings of 72 cents a share on sales of $6.39 billion. Analysts expected a profit of 60 cents a share and $6.25 billion in revenue.