Milling & Baking News Corporate Profiles - November 2013 - (Page 108)
Company Overview
Kraft Foods Group, Inc.
Newly independent company defends market share, trademarks
I
n its first year as an independent
company following the October
2012 spin-off from Mondelez
International, Kraft Foods Group, Inc.
was in defense mode - both in market
share battles with "formidable foes" as
well as in a pair of trademark disputes
over cheese brands.
Innovation is a "pillar" at the new
Kraft, which said it's infusing its pipeline
with flavor, convenience, simpler
ingredient labels and customization.
Additionally, the company is working
to enhance nutrition and reduce
sodium across portfolios and leverage
the voice of the Hispanic consumer in
early product development.
In July, the Northfield, Ill.-based
company reorganized its business
structure with the creation to two units:
Meals and Desserts, and Enhancers
and Snack Nuts.
Earnings during fiscal 2012 fell
nearly 8% while sales eased 2%. Net
income in the year ended Dec. 29,
2012, was $1.6 billion, equal to $2.77
per share on the common stock, down
from $1.8 billion, or $3 per share,
in fiscal 2011. Net revenues totaled
$18,339 million, down from $18,655
million.
The company was accused in a June
lawsuit filed by Saputo Cheese USA
Inc., the U.S. subsidiary of Montrealbased Saputo, Inc., of "unauthorized"
use of the "Toppers" cheese trademark.
Another trademark tiff this year
involved preventing Cracker Barrel
Old Country Store, Inc., from
introducing several meat products
to the retail marketplace under a
licensing agreement with the John
Morrell Food Group, a business unit
of Smithfield Foods, Inc. In July, Kraft
won a preliminary injunction in the
case, after successfully arguing that
the Cracker Barrel branded meats
would infringe on its trademarked
Cracker Barrel brand cheeses and that
Cracker Barrel Old Country Store has
promoted itself as Cracker Barrel in
a prominent fashion and minimized
its use of Old Country Store in the
brand name.
As for defending against competitors
in key categories of macaroni and
cheese, cold cuts and beverages, the
company said during an Aug. 1 call
with analysts it was "not yet firing
on all cylinders in terms of brandbuilding, marketing and promotional
programs."
"And we are still not at share of
voice, share of market, benchmark
advertising levels, behind a number of
our biggest brands," said Tony Vernon,
chief executive officer, during the
call. "We have more to do consistently
across all our categories. But we are
making progress."
Mr. Vernon described the retail
marketplace as a war zone, with "a lot
of competitive Armageddon activity"
in pour-able and spoon-able dressings
and "a pitched battle" in cold cuts.
Macaroni and cheese, what the
company identified as "probably one
of our most important franchises,"
has been losing grip against emerging
competitors.
"We have formidable foes, and
some of the bigger players are getting
into this with some of the entrants,"
Mr. Vernon said. "We'll continue to
battle. . . . So I'm looking for some
real category growth, and I think we'll
defend ourselves nicely." CP
Chief executive officer -
Top brands -
Tony Vernon
Crystal Light
Jell-O
Kraft
Kool-Aid
MiO
Oscar Mayer
Philadelphia
Velveeta
2012 net revenues -
108 \ November 2013
$18.3 billion
Milling & Baking News * Food Business News * Baking & Snack * Meat & Poultry
Corporate Profiles
Table of Contents for the Digital Edition of Milling & Baking News Corporate Profiles - November 2013
Milling & Baking News Corporate Profiles - November 2013
Table of Contents
Editorial - Share price performance remains at odds with food industry financials
Grain-based Foods - Break-up of Hostess reverberates across several categories during 2013
Prepared Foods - Soup category simmers while frozen foods sales stay cool
Beverages - Caffeine buzz rushes through the category
Meat and Poultry - Tight beef supplies offer opportunities for competing proteins
Dairy - Milk production grows amid industry struggles
Confectionery - Segment in recovery, but new challenges beckon
Food service - Menu trends range from better-for-you to over-the-top
Gluten-free - Grain-based foods companies get on board growing trend
F.D.A. defines ‘gluten-free’
Company Overview - Aryzta AG
Company Overview - Grupo Bimbo S.A.B. de C.V.
Company Overview - Campbell Soup Co.
Company Overview - Coca-Cola Co.
Company Overview - ConAgra Foods, Inc.
Company Overview - Groupe Danone S.A.
Company Overview - Dean Foods Co.
Company Overview - Dunkin’ Brands Group, Inc.
Company Overview - Flowers Foods, Inc.
Company Overview - General Mills, Inc.
Company Overview - Hain Celestial Group, Inc.
Company Overview - The H.J. Heinz Co.
Company Overview - The Hershey Co.
Company Overview - Hillshire Brands Co.
Company Overview - Hostess Brands L.L.C.
Company Overview - Kellogg Co.
Company Overview - Kraft Foods Group, Inc.
Company Overview - Mondelez International, Inc.
Company Overview - Nestle S.A.
Company Overview - Panera Bread Co.
Company Overview - PepsiCo, Inc.
Company Overview - Post Holdings, Inc.
Company Overview - Smithfield Foods, Inc.
Company Overview - The J.M. Smucker Co.
Company Overview - Snyder’s-Lance, Inc.
Company Overview - TreeHouse Foods, Inc.
Company Overview - Tyson Foods, Inc.
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