Posted on 02/22/2019 9:42:50 AM PST by buckalfa
The stock price of Kraft Heinz plunged 20% late Thursday after the food giant disclosed it received a subpoena from the Securities and Exchange Commission and reported a large net loss due to the reduction of goodwill in some of its best-known brands.
Kraft Heinz also said in a conference call discussing earnings that it cut its quarterly dividend to 40 cents a share from 62.5 cents and that it was considering selling off some of its businesses to help pay down debt. The company reported $30.9 billion in long-term debt at the end of 2018, up from $28.3 billion a year earlier.
In its earnings release, Kraft Heinz said it received a subpoena last October related to its “accounting policies, procedures, and internal controls related to its procurement function, including, but not limited to, agreements, side agreements, and changes or modifications to its agreements with its vendors.”
After launching an investigation into its procurements accounting, Kraft Heinz said it recorded a $25 million increase in its cost of products sold after determining the amount was “immaterial” to previous reporting periods. The company is also working to improve its internal accounting controls.
The financials reported in Kraft Heinz’s earnings report were well below investor expectations. The company’s revenue rose 0.7% to $6.9 billion, missing analyst estimates by $50 million, while its GAAP net loss came in at $10.34 a share. That net loss was largely caused by an impairment charge of $15.4 billion to adjust the goodwill in some of its businesses, including the Kraft and Oscar Mayer trademarks.
Kraft Heinz was formed in 2015 by a merger of the two food companies that was engineered in part by Warren Buffett’s Berkshire Hathaway. Buffett has previously spoken about how changing consumer tastes are affecting the appeal of brands belonging to Kraft Heinz. The company’s stock is currently down 64% from the levels it was trading at two years ago.
Why the long face, John.......?
John Kerry net worth took a hit.....
Longtime Heinz employees here in Pittsburgh noted that the day after the Berkshire Hathaway boys arrived, funky things started happening with the accounting.
Start by making Oscar Mayer Wieners with all pork as in the past
THIRTY BILLION in DEBT?
I thought Kerry didn’t have any real management of the company!
THIRTY BILLION in DEBT?
I thought Kerry didn’t have any real management of the company!
John Kerry’s wife is going to have to down 18 gin-soaked raisins tonight.
“That net loss was largely caused by an impairment charge of $15.4 billion to adjust the goodwill in some of its businesses, including the Kraft and Oscar Mayer trademarks.”
The company is currently worth $43 billion.
That is a HUGE amount for intangibles and for a loss!
... $15.4 billion ...
That’s a lot of hot dogs and mustard.
Heinz can ROT!
It’s a REALLY bad day today if your name is “Kraft”
The change knocks total assets from $120 billion to $105 billion, and goodwill plus intangible assets from $103 billion to “only” $88 billion. So, tangible assets are $17 billion, and tangible liabilities are $54 billion. So, accounting like Wells Fargo (another Buffett company) or the State of Illinois (does Buffett own this?).
Hitlery lost and they weren’t expecting to have to account for all the graft they invested in her.
I think they make certain varieties in Mexico to get away from our sugar tariffs and use cane sugar instead of high fructose corn syrup.
So far as I know most of their ketchup is still made in Fremont, Ohio.
It's probably in cahoots with the corn (HFCS) lobby.
NOT FONDA KERRY
adjust the goodwill
Think about the USA and the amount of good will on our balance sheet.
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