Risks remain for Kraft Foods ahead of its planned split as it is squeezed by commodity costs, but it will sustain growth in 2012, according to the rating agency Standard and Poor’s (S&P).
A Cadbury production site in the UK that was controversially closed following Kraft’s 2010 takeover has been sold to a developer, according to reports.
Cadbury UK has announced that it will introduce shelf ready packaging to make its chocolate bars stand upright in stores to better attract customers’ attention in a £6m (€7.2m) scheme.
The vast majority of Kraft Foods’ carbon emissions come from outside its manufacturing facilities, according to a survey mapping its environmental footprint, but the full picture may look quite different as full results are withheld.
Developing markets are to make up almost half of revenues for Kraft’s global snacks business as the spin-off business announces Irene Rosenfeld as its head.
Gum titans Wrigley and Kraft Foods plan to introduce smaller five-piece chewing gum packs at reduced rates to boost US sales and reflect consumer spending trends.
Kraft has confirmed that it has chosen Cadbury’s site in Bournville as the site of a new chocolate centre to “drive new product development and new technologies” for chocolate brands.
While the boss of Kraft Foods believes the whole of the business is worth less than the sum of its parts, it is by no means obvious that cutting it up and rearranging it will transform its growth prospects, according to one analyst.
Kraft, in its second quarter results, reports continuing challenges ahead for its gum and candy division in developed markets, and claims the Cadbury takeover is a fundamental earnings driver, with its global chocolate earnings up 9 per cent.
Kraft Foods has said it intends to split into two companies, in a move that would create a global snacks powerhouse separate from its North American grocery business.
Kraft Foods has reported strong sales and profit growth in the first quarter as it increased prices and advertising efforts for core brands to tackle higher commodity costs.
Reflecting the continuing industry trend toward outsourcing, Barry Callebaut said a new supply deal it has agreed with Hershey will put its annual deliveries beyond the current 80,000 metric tonnes.
Kraft Foods is leveraging the growing trend for chocolate and biscuits in developing markets with the opening of a new $80m production facility in Brazil.
Despite robust overall growth, Kraft is still suffering from costs associated with its £11.5bn Cadbury purchase, according to the US giant's full-year accounts.
Two more senior Cadbury executives have left Kraft Foods, joining the other senior management figures who have resigned since the confectioner's takeover by the US food group in February, claim media reports.
Kraft has said it expects to make an additional $1bn in revenue by 2013 because of better access to global markets and distribution networks following its takeover of Cadbury earlier this year.
Industrial chocolate supplier Barry Callebaut has secured a key, long-term supply contract with Kraft Foods, which will see the Swiss firm invest €51m to expand production capacity in North America, the Ivory Coast, Malaysia and Europe.
Food giant Kraft’s acquisition of UK confectionery company Cadbury in February 2010 helped the firm to a better-than-expected first quarter net profit of $937m (£590m), up from $827m in the same period a year earlier.
US food giant Kraft Foods has announced the sale of the Cadbury owned Kandia-Excelent chocolate, sugar confectionery and cake business in Romania to Oryxa Capital, an international investment fund, subject to regulatory approval.
Senior Kraft Food executives pledged their commitment to Cadbury Ireland this week in discussions with the Irish minister for Enterprise, Trade and Innovation, Batt O’Keeffe.
US food giant Kraft has announced first quarter 2010 revenues up 26 percent to $11.3bn after its acquisition of British food and confectionery company Cadbury.
Directors of both US food group Kraft and Cadbury are being called to account at a committee of UK politicians regarding the acquisition of the Dairy Milk maker tomorrow.
The Kraft owned chocolate brand Milka is to be launched across the entire UK market from April, just weeks after the US food giant purchased Dairy Milk maker Cadbury.
Kraft Foods’s reneging on a decision to keep a Cadbury factory near Bristol in the UK open will result in the loss of 400 jobs and has drawn criticism from politicians and unions alike.
Nestlé claims its confectionery business is large enough to enable it to compete in the global sector even if Kraft Foods takeover bid for Cadbury is successful, and that its sights would be set on seeking smaller acquisitions in emerging markets.
Kraft has dismissed the raised long-term growth targets published by Cadbury on Monday, saying the UK confectioner’s prospects are subject to significant risk and uncertainty.
One of the leading investors in Cadbury has revealed he would consider a bid from Kraft if it were in the region of 820p per share, according to recent media reports.
Kraft may look to sell its brand Maxwell House to generate a higher offer to Cadbury, the world's second largest confectionery group, claim media reports.
Kraft Foods is slashing its supply chain costs by $300m - a decision that Leatherhead Food International predicts will dramatically affect suppliers and could result in casualties.
Kraft Foods has defended its valuation of the Cadbury business and insisted that it remains the most logical buyer for the UK confectionery manufacturer.
Kraft Foods has confirmed it has had an initial takeover bid for Cadbury rejected but said it intends to work towards a deal that would create a $50bn food industry powerhouse.
Amidst ongoing amendments to improve food safety after recent US contamination scares, Kraft Foods says that system design and prevention remain central to its hygiene plans as opposed to heightened testing.
The US hedge fund group Trian, run by active investor Nelson Peltz,
has increased its stake in Cadbury from 3.47 per cent to
approximately 4.5 per cent, the confectionery company announced
earlier today.
International firms such as Cadbury are the most successful
confectionery companies in Western Europe, according to
Euromonitor, suggesting that a global outlook is necessary to
survive in an increasingly competitive market.
Mergers and acquisition activity is always ongoing in every segment
of industry, but this summer looks to be a particularly hot one for
food and beverage manufacturers.
