The net profit in the first three quarters increased by over 40% year-on-year, which is reflected in the third quarter report of Kraft Heinz.
On November 3rd, a reporter from Nanduwan Financial News learned from Kraft Heinz that the company had released its third quarter report of this year. The data showed that net sales in the first three quarters of this year were 19.78 billion US dollars, an increase of 3.5% year-on-year; Net profit recorded $2.089 billion, a year-on-year increase of 41%.
Our three core business pillars, catering services, emerging markets, and US retail growth platforms, all achieved growth in the third quarter of 2023. At the same time, we formulated a series of action plans at the beginning of the year to drive market share and sales growth, and we will continue to focus on our overall strategy to drive profit growth After the disclosure of the third quarter report, Fu Meikai, Chairman and CEO of Kraft Heinz, stated that in the third quarter, Kraft Heinz achieved its goal of approximately three times net financial leverage.
A reporter from Nanduwan Financial News Agency noticed that in the third quarter, the net sales of China's international region were 1.57 billion US dollars, an endogenous growth of 8% year-on-year. In the first nine months of this year, the net sales of the international region had reached 4.816 billion US dollars.
Of course, the growth of Kraft Heinz in the Chinese market and the recovery and expansion of the seasoning market are indispensable. According to a reporter from Nanduwan Financial News Agency, Kraft Heinz mainly circulates seasonings such as Weishida soy sauce and Heinz tomato sauce in the Chinese market, and its usage scenarios are mainly concentrated in catering institutions, home kitchens, etc. Among them, catering institutions are one of the largest scenarios for using seasoning. According to data from the National Bureau of Statistics, from January to September this year, the national catering revenue accumulated to 3.71 trillion yuan, an increase of 18.7% year-on-year. The widespread recovery of catering consumption naturally brings growth opportunities for condiments such as Kraft Heinz.
According to research reports from securities firms such as Dongwu Securities and Guosheng Securities, with the accelerated recovery of catering and the continuous realization of raw material cost dividends, the profit elasticity of the seasoning sector is expected to gradually release. Industry insiders believe that in addition to the heating up of the catering industry, takeout, pre made dishes and other sectors are also receiving attention, which has led to an increasing demand for seasoning in the industry.
In addition to the "open source" of food and beverage recovery and market expansion, the "throttling" of raw material prices is also one of the factors driving Kraft Heinz's growth in China. Taking soybeans used in soy sauce production as an example, the prices of related products are decreasing this year. According to data from Business Society, the price of soybean per ton has decreased in the past three months, from 5300 yuan/ton in early August to 5020 yuan/ton on November 3rd. Using Douyi Futures as a reference for soybean prices throughout the year, they have gradually declined since reaching a high of 5682 points at the beginning of this year. On November 4th, they reached 4915 points, with a cumulative decline of 13.49% throughout the year. For Weishida soy sauce made from soybeans, a decrease in raw material prices will help Kraft Heinz control production costs.
It is worth noting that the seasoning industry is a fully competitive industry, and the domestic seasoning market has already encountered a bottleneck period after rapid growth in the early stage, with the industry showing a more "stock game" trend.
A reporter from Nanduwan Financial News Agency learned that in addition to the expansion brought by market recovery, the decline in market share of "big shots" is also one of the important factors for growth, including Kraft Heinz. For example, Haitian Flavor Industry, the "Soy Sauce Big Brother" that has received much attention in recent performance, saw its revenue and net profit decrease by 2.33% and 7.25% respectively year-on-year; Zhongju High tech, which has just ended its equity dispute, reported a revenue of 3.953 billion yuan in the first three quarters, which was the same as last year, but a net loss of 1.272 billion yuan (mainly affected by property sales)... The market share generated by related enterprises was naturally "divided" by seasoning companies such as Kraft Heinz.
It is also understood that in response to the recovery and growth of the Chinese market, Kraft Heinz's main seasoning product, Weishida, has joined the "market chaos" of zero added soy sauce. According to the company's plan, Weishida will gradually launch multiple new products in 2024 and promise to achieve zero preservatives for all products in 2024.
A reporter from Nanduwan Financial News also noticed from the third quarter report of Kraft Heinz that the company reiterated its expectation of a 4% to 6% year-on-year endogenous growth in net sales for the entire fiscal year 2023.