Shares of Kraft Heinz (NASDAQ:KHC) were sliding again today after the packaged food giant issued a disappointing fourth-quarter earnings report, showing that management was still struggling to turn the business around. As of 2:01 p.m. EST, the stock was down 7%.
Kraft Heinz said organic sales, which strip out the impact of divestitures, acquisitions, and foreign currency, fell 2.2% despite a 2% price increase overall. Sales volume and mix together fell 4.2%, showing the company's brands are losing market share.
Overall revenue declined 5.1% to $6.54 billion, which missed estimates of $6.6 billion. On the bottom line, adjusted earnings per share (EPS) fell from $0.84 to $0.72, which managed to top expectations of $0.68, but that did little to assuage investors. Not included in its adjusted EPS was a $666 million asset impairment for some international businesses and its Maxwell House trademark. That follows a $15.4 billion writedown in the year-ago quarter for the Kraft and Oscar Mayer brands, among other assets.
CEO Miguel Patricio, who took the helm eight months ago, was sober about the company's position, saying, "While our 2019 results were disappointing, we closed the year with performance consistent with our expectations, and driven by factors we anticipated," and added, "Our turnaround will take time, but we expect to make significant progress in 2020, laying a strong foundation for future growth."
Kraft Heinz has tumbled over the last year -- the company took a $15.4 billion writedown, revealed an SEC investigation, and slashed its dividend in the year-ago quarter. Management declined to give guidance, but said it would outline the company's turnaround strategy further at an investor conference in May. With nearly $30 billion in debt on its balance sheet and consumer tastes shifting away from its packaged food brands, turning around the business won't be easy.