INTRODUCTION OF KRAFT AND CADBURY
Kraft Foods Inc. (KFT) is the world’s largest food processing company with revenues of $40 billion (fiscal year 2009) which sells its products in more than 150 countries. We are familiar with many of its global brands – Oreo, Philadelphia Cream Cheese, Trident, Nabisco, …show more content…
Some of its highly profitable segments include:
• Kraft Foods developing market segment, net revenues increased $1,365 million (69.8%), and segment operating income increased $85 million (29.8%)
• Kraft’s Europe segment, increased net revenues by $600 million (29.0%), and segment operating income increased $121 million (57.3%)
In the U.S. most of its segments including cheese, convenient meals, and snacks performed better. While its and groceries segments performed under expectation. Below are a few highlighted increases in revenue and operating income.
• The U.S. snack segment also helped increase net revenues by $273 million (22.2%) and the segment operating income increased by $20 million (10.2%)
• Convenient meals segment net revenues increased $32 million (4.1%) and segment operating income increased $19 million (30.2%)
• The snack segment also increased net revenues by $273 million (22.2%) and segment operating income increased $20 million (10.2%)
Some of the main factors for the increase in operating income and revenue are, pricing power, lower raw material and manufacturing costs, favorable foreign currency translation, and broader market share. Further, the increasing popularity of Kraft’s “Healthy” snacks contributed to higher revenues.
Other measures that illustrate Kraft’s better performance include the 4% increase in