Kraft Foods has surpassed Wall Street expectations for first quarter earnings following the company’s separation from global snack business, Mondelez.
The decision by Kraft to split from Mondelez, which holds brands such as Oreo and Cadbury, was driven by a strategy to focus on a narrower mix of products, drive sales and cut costs as reported by SMH.
Industry experts have suggested that Kraft will face numerous challenges in its core market of North America as the packaged food industry has already reached maturity in the region.
To combat this, Kraft executives will be continuing to focus on streamlining its portfolio by pruning out less profitable brand extensions and coming up with new innovations.
The company is also looking to refresh the image of older brands Kool-Aid and Grey Poupon.
Kraft Food Group reported quarterly earnings of $US456m with shares equating to 76 US cents per share, down from $US483m a year ago when the company paid less in interest and other expenses.
Revenue rose two percent to $US4.55b, surpassing analyst expectations of $US4.46b.
Kraft shares were up almost two percent at $US51.37 in after hours trading and the company believes it’s on track to achieve $US2.75 per share by year’s end.