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Consumers helped three of the largest global food and beverage companies increase their profits in the third quarter, ignoring price increases.
The Coca-Cola Company, McDonald’s and Kraft Heinz reported better-than-expected quarterly earnings on Wednesday, despite ongoing challenges with the global supply chain and pandemic restrictions in many parts of the world. The enormous scale of each business and their ability to pass price increases to consumers seem to have helped them in a time of uncertainty.
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Coca-Cola reported net income of $10 billion in the three months ended September, up 16 percent from the same quarter last year. The number of cases it sold increased 6 percent, resulting in more volume than in 2019, but the share of restaurants and dining out businesses did not return to 2019 levels. The company said the Delta variant of the coronavirus affected sales in several markets in August. In April, president and CEO James Quincey, announced Although the company has yet to reveal specific details, the beverage maker will raise prices to cope with rising commodity costs.
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McDonald’s reported a 12.7 percent increase in sales from the same quarter last year, helped by larger customer orders and increases in menu prices in the United States, as well as fewer restaurant closures in Europe. The company expects to deliver a 6 percent increase for customers in the United States this year to cover rising labor and commodity costs. About 80 percent of the fast-food chain’s dining rooms in the U.S. have reopened, but reductions in hours and capacity continue to weigh on its business, the company said. McDonald’s restaurants in China and Australia have been particularly affected by the pandemic quarantines.
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Kraft Heinz reported that its net sales fell 1.8 percent year on year to $6.3 billion. The company’s sale of its hazelnut business to Hormel partially contributed to the decline. And in a sign of rising inflation, the company increased prices in the global restaurant and retail industries by 1.5 percent. In a meeting with investors, the company’s chief financial officer Paulo Basilio said that Kraft Heinz expects to enter the next year “by implementing a pricing plan that maintains our profitability at current cost levels.”
Americans get shot in the wallet food prices, gasoline and other consumer goods continue to rise. NS increase in prices The rising prices have put pressure on policymakers at the White House and Federal Reserve, who say they are temporary oddities caused by imbalances in supply and demand as the economy reopens.
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