H. J. Heinz (HNZ) disclosed on Friday a 5.7% slide in fiscal second-quarter profits amid sluggish North American sales, but the ketchup maker’s profits exceeded Wall Street’s expectations and it stood by its full-year guidance.
Despite the earnings beat, shares of Pittsburgh-based Heinz slumped nearly 3% in premarket action amid disappointment with revenue growth.
Heinz said it earned $237 million, or 73 cents a share, last quarter, compared with a profit of $251.4 million, or 78 cents a share, a year earlier. Excluding one-time items, it earned 81 cents a share, topping estimates by a penny.
Sales jumped 8% to $2.83 billion, but that missed forecasts from analysts for $2.91 billion. Organic sales were up just 1.5%, while organic ketchup sales climbed 6.5%.
Heinz said North American consumer products organic sales inched up just 0.3%, while European sales climbed 5.8% and Asia/Pacific revenue soared 11.6%.
“Overall, we saw a combination of continued strength in Emerging Markets, the U.K. and much of Europe, and mixed results in other developed markets, where consumer confidence fell to its lowest level in 30 years,” CEO William Johnson said in a statement.
Looking ahead, Heinz said it is standing by its projections for fiscal 2012 EPS of $3.24 to $3.32. However, that forecast lags well behind estimates from analysts for EPS of $3.33.
Shares of Heinz sank 2.69% to $51.40 ahead of Friday’s open. The company’s stock has rallied almost 7% year-to-date.