Think positive

Futurists: Margaret King, 52, and Jamie O'Boyle, 54, director and senior analyst (respectively) of Cultural Studies & Analysis, a Philadelphia-based think tank whose clients include Walt Disney Imagineering and General Mills. Scenario: 'We are going through an interesting social anomaly....

Futurists: Margaret King, 52, and Jamie O’Boyle, 54, director and senior analyst (respectively) of Cultural Studies & Analysis, a Philadelphia-based think tank whose clients include Walt Disney Imagineering and General Mills.

Scenario: ‘We are going through an interesting social anomaly. Our culture is no longer dominated by positive visions of the future. In the past, business and technology helped generate such visions, whether through movies, theme parks, or journeys into space. Goodrich tires, GE refrigerators, even commodities like steel and aluminum positioned themselves against the backdrop of a glittering, castles-in-the-air future. All of that fueled a cultural belief that used to drive our purchasing habits – the belief that the future will be better than the past. We’ve lost our instinct to think positively.’

So What? ‘Two factors inhibit our ability to think positively about what lies ahead: the overwhelming velocity of day-to-day change, and the unusually large cohort of aging baby boomers, whose shifting priorities – from ‘get off my cloud’ to ‘get off my lawn’ – have big implications. A growing interest in hanging on to what you’ve got, rather than in creating something new, is a normal part of the aging process. But regardless of age, all of us want one thing: a positive vision of the future.

Futurology Decoder Key: ‘The companies that succeed will be those that can maintain a consistent, positive vision of the future. Disney, once the preeminent purveyor of such a vision, has lost its step. Disney used to tap into our lifeblood by telling us who we are, how we got here, and, just as important, where we’re going. Companies must find a new way to contextualize their products. They need to tell stories that will capture people’s positive imaginations.’

Contact Gene Stephens by e-mail (stephens-gene@sc.edu), or visit the Futurist on the Web (HTTP://wfs.org/futurist.htm).

Reprinted with permission from Fast Company April 2000

Kraft Heinz beats the street, but reports slight sales slide

The company's Q2 net sales, while down slightly, reveal continued demand for snacks and pre-packaged meals.
Kraft Heinz

Kraft Heinz is reporting earnings of 78 cents a share, beating Wall Street’s estimate of 72 cents a share, thanks to continued demand for snacks and pre-packaged meals. However, the company also reported a net sales decline of 0.5% compared with the same period last year, to $6.6 billion, according to its latest Q2 earnings report, released Tuesday.

The company experienced a favourable 2.3 percentage point impact from currency and a negative 0.7 percentage point impact from its February divestiture of Hormel Foods – including the Planters peanut brand – which closed in the second quarter of 2021.

Its cheese divestiture – which included the sale of its natural cheese division to Lactalis – is expected to close in the second half of 2021, says Kraft Heinz Global CEO Miguel Patricio in this morning’s conference call.

Adjusted EBITDA slumped 5.2% versus the year-ago period to $1.7 billion and increased 6.6% versus the comparable 2019 period. Higher transportation and inflation-related goods costs continue to affect the company’s bottom line.

Kraft Heinz’ organic net sales declined 3.6% in Canada over the last three months compared with a comparable period last year, this as total net sales rose 8.8% year over year. 

However, its overall organic net sales slipped 2.1% compared with 2020 figures. This includes the negative impact stemming from exiting its McCafé licensing agreement. However, this decline was partly offset, Kraft Heinz reports, by “partial recovery in foodservice channels and retail consumption trends.”

“Food service is recovering, and recovering fast,” Patricio stressed in today’s earnings call. He said “the bet to support QSR” early in the pandemic, with individual packets of ketchups and sauces, is paying off.

Channel trends are still normalizing, he warns, and it’s too early to see how at home or away from home, will net out. “We have big ambitions for away from home business,” he said. Consumers continue to evolve how they eat, with Patricio saying that Kraft Heinz is collaborating with a popular DTC brand for its Philadelphia cream cheese.

Accrued marketing costs, the company reports, rose to $968 million from $946 million in December 2020.

“We are investing more in our brands, and better as well, building a much more creative company,” Patricio reported.

Kraft Heinz is also strengthening and diversifying its media presence, he said, driving repeat rates for those discovering and rediscovering the brand. Patricio added that the company is continuing to drive its transformation program forward, modernizing its brands and better connecting with its consumers.