Posted on 02/28/2006 11:08:01 AM PST by new yorker 77
Ketchup maker H.J. Heinz Co. (NYSE:HNZ - news) on Tuesday posted a 23 percent drop in net profit, and fell short of Wall Street estimates, as its tax rate rose and the stronger dollar cut into the value of overseas sales.
Analysts said part of the earnings miss was because some operations that were reclassified by the company as discontinued had been classified as ongoing operations by analysts when they made their estimates.
"At least part of the apparent miss was due to the sale of businesses in Europe, as Heinz streamlines its operations there -- a plan that we like," Edgar Roesch, analyst at Bank of America Equity Research, said in a research note. He rates Heinz shares "buy."
The company is in the process of selling parts of its European business in order to improve profitability in that region. It saw sales volume declines in its Italian baby food business and frozen food business in Britain.
Heinz shares rose 5 cents to $37.65 in morning trade on the New York Stock Exchange, after falling as much as 2.6 percent earlier.
Net profit fell to $116.6 million, or 35 cents a share, for the fiscal third quarter ended January 25, from $152.4 million, or 43 cents a share, a year earlier.
Excluding one-time items, earnings from continuing operations were 50 cents a share, the company said. Analysts on average forecast earnings 56 cents a share, according to Reuters Estimates.
Sales rose 5.7 percent to $2.19 billion, driven mainly by acquisitions. Excluding the impact of foreign exchange rates, sales were up 9.4 percent. Analysts on average had forecast sales of $2.37 billion.
Based on volume, which factors out currency and price fluctuations, sales rose 2.9 percent, driven by the North American consumer products business and the Australian and UK businesses.
The company's European seafood business, which Heinz agreed last week to sell to Lehman Brothers Merchant Banking for 425 million euros, and the Tegel poultry business, which Heinz has also agreed to sell, were both included as discontinued operations.
The company said it is still looking to sell other businesses and is looking for ways to maximize shareholder value in its European frozen foods business.
Heinz's effective tax rate in the quarter rose to 35.5 percent, compared with 22.3 percent in the year-earlier quarter. Heinz said it continue to expect an effective tax rate for the fiscal year of 30 percent to 31 percent.
Heinz stood by its forecast for a 6 percent to 8 percent increase in fiscal 2007 earnings from pro forma 2006 earnings of $2.10 to $2.16, with sales up 3 percent to 4 percent.
Heading into Tuesday, Heinz shares traded at about 16 times estimated 2006 earnings, compared with a multiple of 17 for the Dow Jones U.S. Food Producers Index. (^DJUSFO - news).
The stock rallied 10 percent between February 6 and February 23, boosted by talk that billionaire investor Nelson Peltz could challenge the company's management in a proxy fight.
The deadline for filing a proxy motion is Saturday, Heinz Chairman and Chief Executive William Johnson said. He declined to say if he had spoken directly with Peltz.
"We're always prepared and willing, pleased to meet with shareholders." Johnson said in response to an analyst's question during a conference call.
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You're right. Heinz has a ton of frozen foods brands and McDonald's owns the restaurants headquartered out of Golden, CO:
http://www.responsibleshopper.org/basic.cfm?cusip=580135
It's not the latest information, it's the same information it was in 2004 when certain people got all bent out of shape about John Kerry and his wife.
It's symbolism over substance. You'd need a time machine to prevent Teresa Heinz from being rich, and boycotting a good company to make a futile political point only hurts honest working people.
SD
Very good one Proud.
Yes they will! They will make ME feel better!!
Boycotts never work... we know that.
No problem. They make ME feel better.
Heinz is the only good catsup or is it catshup or is it catchup?
Psst. Best not to post that copyright notice at the bottom.
bttt
Did you check out the link I provided to others? It's amazing to me who owns what these days:
http://www.responsibleshopper.org
"Heinz is the only good catsup or is it catshup or is it catchup?"
Actually, I checked the spelling before I posted... There are several possible spellings - all "correct":
"When Heinz introduced commercial ketchup to American kitchens it became so popular that other manufacturers rushed to catch-up to the ketchup craze. Soon there were Ketchup, Catsup, Catchup, Katsup, Catsip, Cotsup, Kotchup, Kitsip, Catsoup, Katshoup, Katsock, Cackchop, Cornchop, Cotpock, Kotpock, Kutpuck, Kutchpuck and Cutchpuck. All were tomato based and bottled and vied to become a household word. Only 3 major brands remained to steal the spotlight...Heinz Ketchup, Del Monte Catsup, and Hunts, who could not decide on a spelling and bottled under the names Hunts Catsup (east of the Mississippi), Hunts Ketchup (west of the Mississippi)...
http://www.globalgourmet.com/food/sleuth/0799/
KETCHUP VERSUS CATSUP
http://www.worldwidewords.org/qa/qa-ket2.htm
More of the same....
http://www.antimoon.com/forum/2003/3291.htm
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