In a speech to Heinz shareholders, William R Johnson reviewed the company’s results for fiscal 2009, which ended on 29 April of this year. The full-year results, which Heinz reported on 28 May 2009, included:
“Fiscal 2009 continued our streak of superior results under our plan to drive growth and high performance,” Johnson said. “Over the last three years, our global sales have grown at a compound annual rate of more than 5% and earnings per share have increased from an organic base of $2.10 in Fiscal 2006 to $2.90, a compound annual growth rate of 11%.”
In fiscal 2009, “Heinz delivered exceptionally strong Operating Free Cash Flow of $880m, making it possible to raise your dividend for the sixth consecutive year at a time when many other public companies have suspended or reduced dividends to conserve cash in this tough economy,” said Johnson.
Noting that Heinz has increased its annualised dividend almost 56%, from $1.08 in fiscal 2004 to $1.68 in fiscal 2010, Johnson added: “As Heinz moves forward, I assure you that growing your dividend remains a top priority as we are committed to returning a high percentage of earnings to our shareholders.”
Mr Johnson said the company’s record results in fiscal 2009 reflected:
“While Heinz performed well in developed markets, our emerging market businesses delivered even more impressive results with reported sales increasing almost 9%, propelled by growth in India, Indonesia, Latin America and Poland, as well as higher baby food sales in China,” Johnson said in reviewing fiscal 2009 results.
Reiterating the company’s previous comments about emerging markets, Johnson added: “We expect emerging markets to contribute disproportionately to our long-term growth and anticipate that they could generate as much as 20% of our total sales by fiscal 2013, compared with 14% in fiscal 2009 and just 11% three years ago.
“Our increased marketing and successful focus on quality and innovation have helped Heinz rise to the challenges posed by the global recession and the emerging trends of increased at-home dining, channel shifting and the growth of private label,” Johnson said. “While consumers around the world have changed their behaviour in response to economic concerns, they remain loyal to Heinz brands because we deliver quality, nutrition, innovation, convenience and value. They trust our company’s brands, as they have for 140 years.”
As Heinz announced on 28 May 2009, Johnson said the company is projecting constant currency:
“Heinz is also expecting another strong year of cash generation with Operating Free Cash Flow of $850-900m in fiscal 2010,” Johnson said.
Source: HJ Heinz Company
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