Who We Are

Consumers inspire us. To make today delicious, we begin with our consumers. We listen, we watch and we learn. We understand their joys and their challenges because we’re consumers too.

What we do. We make delicious foods you can feel good about. Whether watching your weight or preparing to celebrate, grabbing a quick bite or sitting down to family night, we pour our hearts into creating foods that are wholesome and delicious.

Our reach. We believe we can make a delicious difference, everywhere. We’re constantly looking for fresh ideas to improve our workplace, our partnerships, our communities and our world.

How we behave. We understand that actions speak louder than words, so at Kraft Foods:
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We inspire trust. We act like owners. We keep it simple. We are open and inclusive. We tell it like it is. We lead from the head and the heart. We discuss. We decide. We deliver.

How we grow. We focus on creating sustainable, profitable growth. And our strategies guide our efforts:
• • •

Build a high performing organization Reframe our categories Exploit our sales capabilities

We discuss. Roughly 80 percent of these heritage brands hold number one or number two positions in their respective categories and are household names. • Unleash the power of our iconic heritage brands. like Philadelphia cream cheese in Europe andTang powdered beverages in Asia Pacific. Our iconic heritage brands are loved by consumers worldwide. like LU biscuits. We act like owners.000 diverse employees around the world are the reason we succeed. They’re also looking for simple indulgences and healthier options. We’ll do this by living our values: We inspire trust. Our approximately 140. Consumers around the world are pressed for time and are looking for on-the-go options. We decide. Strategies We’ve set our sights on becoming a global snacks powerhouse and unrivaled portfolio of brands people love. We tell it like it is. And there’s nothing better than a delicious snack. Tridentgums. We keep it simple. • Create a performance-driven. We lead from the head and the heart. Whether it’s regional brands. We are open and inclusive. or local favorites like. values-led organization. The complementary nature of our portfolio is at the heart of the three strategies that will drive our growth: • Delight global snacks consumers. Delivering on these strategies will put us in the top tier of our peer group and provide our shareholders with top-tier returns on their investment: • Organic revenues growth of 5 percent or more… . and Cadbury or Milka chocolates to satisfy those desires. A1 sauces in the US and Vegemite spread in Australia. we need to win with our customers and consumers. It takes great people to make great brands. To win in the market. communities and suppliers.• Drive down costs … without compromising quality About our people. We deliver. Planters nuts. and with our colleagues. we make delicious products for billions of consumers every day.

Continuously improving the safety of our work environment by investing in our people and our facilities. Kraft Foods is committed to: o o Meeting or exceeding all applicable safety and health regulations. we’re helping to build a better world for tomorrow: a world where there’s enough food for all. Where everyone has access to it. . we’re doing what’s right and holding ourselves accountable. How are we doing? The programs we put in place at our plants meet the Occupational Health and Safety Assessment Series (OHSAS) 18001 Series. o Each of us should participate in a local safety program and actively seek to achieve an accident/injury free work environment. Accordingly. o Each of us must be dedicated to conducting all activities with the highest concern for employee safety and health. And.Mid.to high-teens margins… Our Safety Policy At Kraft Foods. o Safety and health improvement is an individual and team responsibility. by doing our part and acting with care today. we believe: o All accidents and injuries are unacceptable and we will do our best to eliminate all such incidents. we are proud to see improvements in our safety performance every year. o Creating and maintaining a world class safety culture to achieve an accident-free work environment. global and local. Working to build a better World through actions large and small. one of the only internationally recognized safety management systems.

We’re making good progress. a world where ethics and profit are not mutually exclusive. as a public company. like Kraft foods and Cadbury. and we can’t do it alone. Kraft foods must delight our consumers and our customers so that we can deliver value for our shareholders. Where the land is managed wisely. but there is much more to be done. from increasing sustainable agriculture to reducing product packaging to providing affordable nutrition. and where natural resources are treated with respect. you must make a positive difference. this is a journey and we need your help. and we’re actively pursuing them. a world where the air and water are cleaner. We invite you to read about our efforts in the pages that follow and accompany us on our journey i always tell our employees that regardless of your role. as the world’s second largest food company. affordable and delicious. that means the company must be better off for your having been there. i feel the same about our organization as a whole. and where everyone is treated fairly. makers . there are many ways we can make a difference. We’re doing our part and leading the way. but successful companies.and it’s nourishing.

this report is designed to provide the core information we think you’d want to know about the seven key areas that embody our economic. you can print it if you’d like. our business partners. but. following our acquisition of Cadbury in february. quarter after quarter—despite how important that is.of brands people have loved for more than a hundred years. to save trees and keep it relevant and timely. social and environmental responsibility… what we do. our employees. . this report covers only our legacy Kraft foods business. one must focus—not only on today but also on tomorrow. why we do it and how we’re getting on. know it takes more than delivering the numbers. but. it’s not easy…but balancing the short and long term is key to delivering sustainable. We’ve also grouped the information in sections so that you can easily search for exactly what you want—whether it’s our progress on reducing waste or our position on advertising to children. profitable growth—growth that is good for our shareholders but also good for our consumers. at present. the communities where we live and work. we’re releasing it online. to build and sustain brands people love and trust. and the planet we inhabit. we’re working hard to integrate our businesses and consolidate our information.

Kraft foods april 2010 . inspiring trust takes hard work. rosenfeld Chairman and Chief executive officer. keep checking back. so.and we’ll update this report as we move along. our track record has and will continue to demonstrate our commitment. irene b.

as we look to drive up volumes. . which has not been utilised. which has been imported from Thailand to serve the Indian market so far. "We will start local manufacturing of Tang in India." he said. however. We need to expand it and we will be doing it significantly.6 billion in January this year. will be produced at Kraft's Hyderabad plant. A Lost Time Accident is when an employee is injured to the point where they cannot return to their next regularly scheduled day of work. sales and customer service field offices and research and development centers in the United States and Canada. We will start manufacturing there. "It is a legacy plant of Kraft in Hyderabad. He said Tang. Asked if Cadbury India will be selling more products from Kraft portfolio. Cadbury India came under the Kraft Foods fold after the US-based firm acquired British candy maker. Kripalu said: "As of now we are still focusing on our core confectionery business. Commenting on the overall plans of Cadbury India. The chart depicts safety data at all Kraft Foods manufacturing sites worldwide." Cadbury India Managing Director Anand Kripalu told reporters in Delhi on the sidelines of a CII event. while it will also embark on a capacity expansion for its confectionery products." He. Cadbury Plc for $19." He said the expansions will take place at the company's existing six facilities in India but declined to share details such as investments and envisaged additional output. We are rejuvenating it and we will start producing it within this fiscal. • • And EPS growth of 9 to 11 percent. It also includes safety data for corporate offices. he said: "Capacity is a challenge for us.This chart shows the number of Lost Time Accidents per 100 full-time equivalent Kraft Foods employees per year. Cadbury to start producing Kraft Foods' Tang in India NEW DELHI: Cadbury India on Thursday said it will start local manufacturing of parent Kraft Foods' orange drink Tang . said integration process is still going on in terms of synergising distribution channels of Cadbury and Kraft in India .

including Cadbury Dairy Milk. Kraft proposes to capitalize on population growth trends and exploit scale to invest in infrastructure. A decade ago. Its attempt to sell its orange drink Tang in India met with limited success.800 crore). is an important event in India’s packaged food market. Kraft proposes to capitalize on population growth trends and exploit scale to invest in infrastructure The acquisition of Cadbury Plc by Kraft Foods Inc. India figured prominently in Kraft’s rationale for acquiring Cadbury and even in the latter’s defence argument asking for a higher price. grocery and convenient meals—that it can add on top of Cadbury’s existing portfolio. beverages. Cadbury had a share of about 32% of the Indian confectionery market in 2008 and a 70% share of the chocolate market. Kraft Foods can make it big in the Indian market In developing markets. the market barely excited global food firms. It also sees a long-term opportunity of consumers trading up to its products. though the small retailers such as corner shops may not be of much use to Kraft. Kraft has a global portfolio of food brands—spanning categories such as snacks. The confectionery market can be broadly divided into chocolate. cheese. Kraft has an insignificant presence in India compared with Cadbury’s sales of £240 million (around Rs1. 5 Star and Perk.Cadbury sells chocolate brands. A direct entry would have been expensive as it would have to build a marketing and distribution network from scratch. The network of traditional grocery stores and modern trade is an especially valuable one. The Cadbury acquisition gives it a ready revenue base and a large distribution network reaching out to about one million outlets. India would have been just a footnote in a mega acquisition such as this. gum and sugar confections. Also Read Fund managers are complacent: survey Returns on Tata Power may be capped . Graphics: Yogesh Kumar / Mint In developing markets. along with snacks Cadbury Bytes and health drink Bournvita among others in India. But that was then.

otherwise the potential will remain only on paper. expanding distribution. More clarity will emerge later. Cadbury’s transformation from a decade ago has been remarkable. “Kraft has a wide basket of products across the world. creating the world’s largest confectioner. rather obvious. which could also be a biscuit product. Kraft’s ability to absorb Cadbury’s insights on the Indian market is more crucial. India. A few more including Pepsi and Kraft Foods are planning to make a foray. managing director. The biscuit market is buzzing with new players. It has become more aggressive. two international companies have made an entry—UK’s United Biscuits and GlaxoSmithKline. because Indian consumers are willing to buy premium products and firms have in modern trade an effective platform to address this market. denied it. is in the process of developing a low-cost nutritional food product. launching new products and variants. operating at several price points and thereby raising consumption. While the tangible benefits of the acquisition are one aspect. Pepsi. At stake is a Rs 10.” says Anand Kripalu. And every year. So. on the other hand.The environment is right. big and small players are queing up for a share of the bite. Nestle India Ltd and even Hindustan Unilever Ltd could see some competitive pressures emerging in some product segments. Many of Kraft’s products would qualify as premium products in the Indian context. the world’s second most populated nation. too. when the changes become visible on the ground. India's biscuit market goes global. the recognition. Which of these will be introduced formally in India is currently under dialogue. But the story was a tad different—it stated the obvious. But large food companies such as Britannia Industries Ltd. Kraft had taken over Cadbury in a $19. But that may not hold long enough. local & international brands vie for market share A few years ago a biscuit brand in India made headlines when it became the world’s largest selling brand. Industry sources though say that Kraft has already signed a deal with a local biscuit manufacturer and its entry into the Indian biscuits market should happen much earlier. Kraft’s ability to customize its products and marketing strategy to suit the Indian marketplace is crucial. Cadbury India . however.5 billion deal in February 2010. What does this mean for other Indian companies? Kraft is bound to be a little more aggressive than Cadbury due to cultural differences and also the need to prove to its shareholders that the acquisition is indeed working. The per capita consumption of biscuits in the country has grown from a paltry 400 grams about . was also the largest biscuit consuming country in the whole world. including biscuits. which is still growing.000-crore business. perhaps came in a trifle late. In the last one-year. The company’s spokesperson. tweaking its chocolates to withstand a hot climate and making a big play at capturing the festival gifting market.

The company is running this campaign in more than 40 countries around the world. Kraft Foods to provide food to 10. India still lags behind other countries like the US and UK where it is more than 10 kg and even behind many South East Asian countries where it is 4. While this is a huge change. which provides meals to underprivileged school children. The share of glucose biscuits has dropped from 70% to 50% in about five years.000 children in India New Delhi: US-based confectionery and beverage corporation Kraft Foods will provide cooked meals to over 10. growing 20% a year. Kraft Foods.ten years ago to 1. which launched Aliva baked crackers in 2009.000 cr biscuits market NEW DELHI: Forget cola war. Glaxo in Rs 11. South Asia and Indo-China. for this programme. "This year's delicious difference week is particularly special for us because it marks our first employee volunteer event post the integration.” says Jayant Kapre. will start test-marketing oatsbased premium cookies under its Quaker brand next month. What helped the company was also the fact that here it was just not volume growth but also higher value growth. India was a key. For United Biscuits. “This is what made it a natural choice to enter.5-2 kg today. The company has partnered with non-profit Akshaya Patra Foundation." Kraft will also organise various events this week in association with hundreds of NGOs across the globe. "Making a small difference in the communities in which we operate is a key part of our culture. its share in the overall pie has gone down. president of United Biscuits India .000 children in 15 locations across India as part of its "Delicious Difference Week" campaign from Oct 4 to 9. high consumption market where it did not have a footprint.000-crore Indian biscuits market that is getting chock-a-block with new entrants. Through our delicious difference week initiative in India. The American food and beverages maker. It is this gap that is the opportunity for new companies eying the Indian market. Over the last few years. In India. PepsiCo India is among a slew of domestic and international companies rushing to the fastestgrowing processed food segment in the country. which entered the Indian market last year. PepsiCo now wants to battle it out in the Rs 11." said Anand Kripalu. this is Kraft's first initiative post integration with Cadbury. Britannia and ITC have moved into the cookie and high value segment to capitalise on the high growth and higher margins. two officials directly involved with the development said. president.25 kg. UB. players like Parle. faster than noodles and . Even though glucose biscuits still sell much more in terms of volumes than any other segment. Pepsi joins Kraft. we're helping in our own small way.

American major Kraft Foods is expected to kick off its India foray with biscuits some time this year. is revising the brands and countries it will focus on in developing markets as a result of its acquisition earlier this year of Cadbury Plc. Speculation is rife that Marico. a subsidiary of Unibic Australia and makers of ANZAC Oatmeal cookies and Bradman Chocolate Chip cookies. July 2.potato chips. said Sanjay Khosla. “What’s unique to biscuits is that it’s perhaps the only packaged food product that has universal acceptance. Last year. biscuits industry veteran and MD of Bangalore-based biscuit maker Unibic India. is revising the brands and countries it will focus on in developing markets as a result of its acquisition earlier this year of Cadbury Plc. “The category will explode this decade. They join Oreo cookies. though neither Marico nor Unibic have confirmed the move. most of them also have a presence in the premium segment – because they can make more profit and the demand is on the rise. Developing markets make up about 26 of Kraft’s total business. Kraft revamps developing markets strategy after Cadbury According to Reuters. founder and chief strategy officer of consultancy firm Five by Six Consulting. 5 and Rs 10 price points through glucose and salt biscuits to capture volumes . its focus markets are changing as well. biscuits start at a very affordable price and are easily available. As Kraft changes its brand focus. make the list of 10 “power” brands getting the bulk of the marketing money in developing markets. Kraft’s President. Developing Markets and Global Categories. and Khosla said India is now one of the 10 focus markets.” says Nikhil Sen. and Tridentgum. Russia. while its 8 kg in the US and 12 kg in the UK. But the $18. Already. Jacobs coffee.” says Richa Arora. While almost all biscuit companies have been pushing the Rs 2. will buy a 51% stake in Unibic for Rs 130 crore. Other focus markets under his purview are Brazil. One of the key benefits of buying Cadbury was its distribution infrastructure in the vast India market. Cadbury Dairy Milk chocolates. three Cadbury brands. Biskuat/Tiger biscuits. . Domestic company Marico too is reportedly planning a foray into the segment by acquiring Unibic India. Halls lozenges. Kraft Foods Co. which makes Parachute hair oil and Saffola cooking oil. the two companies that dominate the Indian biscuit market — Parle Products and Britannia Industries — is facing stiff competition from the Sunfeast brand of cigarettes-tohotels firm ITC and smaller brands such as Priya Gold and Cremica. The new top 10 brands account for more than 40% of the $12 billion in revenue Kraft gets from developing markets like China and Mexico. 2010 According to Reuters. Glaxo Smithkline Consumer Healthcare extended its milk foods drink brand Horlicks to cream biscuits and cookies. Khosla said. 10 key developing markets. Lacta chocolate. The per capita consumption of biscuits in India is said to be 2 kg a year. Tang drink mix.4 billion acquisition of Cadbury meant the members of that template had to change.Milka chocolate. and five categories. Australia. Kraft already had a strategy in place in which it focused on 10 “power” brands that could be grown globally. while UK’s United Biscuits launched McVities digestives biscuits in the country. Kraft Foods Co. Club Social/TUC crackers.

Cadbury Boosts Kraft’s Market Cap We estimate that the Cadbury acquisition adds a net $4 billion to Kraft’s market cap. Many criticized Kraft’s management for this deal.Mexico. Cadbury Acquisition Should Sweeten Kraft's Stock Kraft Foods (KFT).5 billion cash purchase price. candy and gum) to Kraft’s stock. Chocolate. and the Middle East. You can modify our forecast for Kraft’s share in the chocolate/candy and gum markets in the charts above to see the impact on the Trefis forecast of $35. Kraft’s share in the global gum market has soared from 0. we estimate that chocolate. completed its acquisition of the confectionery giant Cadbury early this year for the whopping sum of $19. We expect the Cadbury acquisition to add a net $4 billion to Kraft’s market cap. Kraft’s becomes the #2 global gum manufacturer Cadbury’s strong gum portfolio includes popular brands such as Trident. Kraft is now second only to Wrigley (WWY). Ukraine. Below we discuss the importance of the confectionery business (chocolate. with a total share of around 5. With the addition of leading Cadbury brands such as Dairy Milk. Kraft was a bit player in the global chocolate and candy market. Much of this contribution can be attributed to the Cadbury acquisition. Kraft is expected to gobble 15% of the global chocolate and candy market in 2010. As a result. Here’s what Cadbury does for Kraft’s confectionery market share: 1. given that the company had to sell its lucrative North American pizza business to Nestlé in order to generate sufficient cash. after subtracting the $19. Candy and Gum constitute 32% of Kraft’s stock Going forward.64 for Kraft’s stock price. 2. Kraft can leverage Cadbury’s strong distribution channels and retailer partnerships in emerging markets such as India to promote its other products. Markets that are out of the top 10 include the Czech Republic.5 billion. South Africa. Eclairs and Halls. Poland. In addition.1% in 2009 to around 27% in 2010. China.5%-6%. Creme Egg. and Indonesia. Stimorol and Dentyne. the Philippines. . candy and gum sales will account for around 32% of the $35. Chiclets. Kraft’s triples its share of global chocolate and candy sales Before the Cadbury merger.64 Trefis price estimate for Kraft’s stock. which controls 35% of the market. the world’s second largest food & beverage company after Nestlé. and how Cadbury brings additional value to this business. Its primary offerings were Milka and Toblerone chocolates.

He also questioned Rosenfeld’s move to sell Kraft’s frozen pizza business for $3. Even with the pizza sale. Everyone likes an Oreo.” Buffett doesn’t frequently trash the moves of CEOs at companies in which he’s a holder.7 billion to help finance the Cadbury deal. Kraft already has dominant market shares in many of its product lines. Developing countries should account for one third of sales by 2013. Kraft Cheese and Oscar Mayer meats. but Kraft may find that pricing gets tougher as it pushes deeper into developing economies. . on September 15. suffered the added humiliation of having Warren Buffett. Rosenfeld didn’t waste much time in announcing. is growth. Procter & Gamble (PG) and other packaged goods makers suffer from the same syndrome of being so big in many markets that growth is limited. Kraft said. and Kraft seems to be counting on poorer countries to scarf up more Oreos and such. watching the stock slide sideways. even before buying Cadbury earlier this year for $19. the Cadbury deal pushed long-term debt way up at Kraft. And human beings – even us gluttonous Americans — can eat only so many sugary. that Kraft had a new global growth strategy. and that could make hitting its goal on profit margins more difficult. margins in the mid-to-high teens. The growth part will be trickier. KFT Stock Chart So. had a great portfolio of processed food brands. sadly.B) is her largest institutional shareholder. KFT Stock Chart That gives the company somewhat less financial flexibility. Kraft spent about $7 billion on buybacks during the years 2004-2008. meaning excluding acquisitions. And well before being fully spun off from Altria (MO) in 2007. with a roughly 8% stake. Poor Irene Rosenfeld. Nabisco. if need be. salty or fatty snacks. of course. Maybe that would get the Old Boy in Omaha off her back. about one fourth now. and per share net growth of 9-to-11%. The plan actually sounds more like a set of financial promises – 5% “organic” revenue growth.Kraft Growth Plan: Better Late Than Never Kraft Foods (KFT).600 workers – to wring more value and growth out of those brands. especially since it has in recent years paid out nearly 60% of its profits in dividends. Kraft’s CEO. If you’re a shareholder.6 billion. publicly call her Cadbury acquisition “a bad deal. Squeezing out costs to boost margins seems doable. Kraft had embarked on a five-year restructuring plan – taking about $3 billion in charges and aiming to ax some 18. and Kraft can certainly get closer to its EPS goals with the aid of share buybacks. which include Oreo. KFT Stock Chart The basic problem. but reducing shares outstanding and thus boosting EPS. vs. the results have not been impressive. whose Berkshire Hathaway (BRK.

they add. Three products are being distributed -. completed in 2008. Though Cadbury has an over 35 per cent share in confectionery with two candies — Halls and Eclairs — and one gum called Bubbaloo. At some stage in the future. when shareholders of British candy maker Cadbury Plc approved Kraft Foods' $19." .Tang. But by August 5. South Asia and Indo-China. make its categories more relevant to consumers. Second. Cadbury India. Kraft said its four key strategies are to rewire its organization for growth. Kraft plans India foray with confectionery The Kraft-Cadbury combine is likely to herald its presence in India with confectionery products. Toblerone and Oreo. Kraft had been predicting revenue growth without acquisitions (“organic”) of 4% for this year. Third. industry sources aver that Kraft is betting on the confectionery segment since. Rosenfeld. "I cannot comment on the integration and how it will pan out. for the combined Kraft Foods entity (which is yet to be christened). Kraft. is growing at a steady clip of about 15 per cent. estimate industry observers.The early going in 2010 isn’t entirely encouraging. managing director. Kraft in India is small. Anand Kripalu. say persons familiar with the development. Perhaps the five-year restructuring plan.500 crore in size -. Of course Rosenfeld didn’t rejoin Kraft and become CEO until June 2006 – with Kraft well into the earlier restructuring — and every boss deserves her own swing of the ax. the confectionery market is Rs 4.5billion takeover. globally. exploit its sales capabilities and drive down costs. in India. in announcing her new growth plan. was just a warm-up for what’s to come.600 colleagues. may leverage Cadbury's international portfolio to expand the confectionery side of the business.” To workers who spent years waving goodbye to those 18. 29 per cent (highest contributor) of its revenues in 2009 came from this division. too. the operations of this will be routed through the merged entity. For one. management had apparently lost confidence in even that meager improvement. which is closer to Rs 2. this February.000 crore. spoke of “establishing a world-class cost structure. adjusting the projection to a range of 3-to-4% growth. Confectionery. declined to divulge any details or give any timeline for launch of the products. Rosenfeld’s goal might sound a little frightening. Confectionery is definitely an area that requires beefing. which Kraft would want to capitalise on. it created the world's largest confectioner. and president. there is more that can be done. The reasons are evident. It is too early to speak about the integration at this stage.double that of the chocolate market.

earlier in charge of HR. If you have to make a difference. This strategy of identifying premium products. The company. The premium end is a bit less crowded in that sense. Once chocolates and confectionery are taken care of. The new team is headed by managing director Anand Kripalu. an executive of a rival FMCG firm says: "The purpose of the Cadbury acquisition was to give Kraft a strong presence in chocolates and confectionery — two areas they see as high-growth and high-margin. distributed by Universal and Barakat. have been doing. has effected management changes to head the Kraft Foods and Cadbury combine in Indo-China and South Asia. it derived only 14 per cent of its revenues from this business. who is president. This will be routed through the merged entity. It's in line with their global strategy. in 2009. Though Kraft is known for its cheese.something that rival Britannia [ Get Quote ] has been doing over the last few years. Kraft. which rides on the health platform. It makes sense to give the confectionery business a boost. Kraft derived 10 per cent and 8 per cent of its revenues from convenient meals and grocery." he says." says the managing director of a rival FMCG firm. Says Pardeshi. Cadbury remains the dominant player in the chocolate category. senior FMCG analyst at brokerage firm Anand Rathi. or Nabisco. say industry sources. will sit at the premium end of the merged entity's chocolate portfolio. respectively.a segment where it already has a strong brand.However. even ITC. however. "In biscuits. attempting to enter allied food categories from the lower end is not going to be easy. Globally. say industry sources. is likely to leverage this familiarity that Indians have for the product by formally launching it in India. Kraft cheese has been circulating in India through grey channels for long." After biscuits will follow Kraft's much-awaited dairy foray. where Cadbury is present." he says." Kraft. dominated by Parle. People in India are already familiar with the bluecoloured circular box that has the picture of a cow on it. "I am not surprised if the company is looking to do that. Kraft is said to be looking at a debut in foods as well. plus regional and unorganised players. which is a cookie. You are also not dependent on pricing alone. which is already distributed in India through distributors Universal Corporation and Barakat Foods & Tobacco. is likely to drive Kraft through the categories it marks its presence in. you have to move up. "This will be interesting to watch. Oreo. It has Toblerone. meanwhile. South Asia and Indio-China. "Kraft would probably have to play the same game whether it is with Oreo. value-for-money is driven by the glucose platform. "Barring chocolates. Cadbury India. will not leave the chocolate segment unattended. will . Kraft is likely to restrict itself to the premium end -. while Chandramouli Venkatesan. That is because Kraft takes on a whole host of established players in the segment — from arch rival Nestle [ Get Quote ] to Hindustan Unilever to ITC Foods. You have strong incumbents sitting there. Toblerone. they say. Kraft is likely to devote its attention to biscuits -. Even as it gears up for a likely foray into these segments. which you are at the lower end of the market. with an over 70 per cent share in the country." says Shirish Pardeshi. which is what Britannia.

The company is headquartered in Northfield. Its European headquarters are just outside Zürich. a Chicago suburb. it is listed on the New York Stock Exchange and became a component of the Dow Jones Industrial Average on September 22.. etc. 2010 Kraft Foods Inc. and Narayan Sundararaman. Opportunities * * * * * * * Dog food Operates in many fast growing categories International markets New categories. Nabisco. 2008. is the largest confectionery. and beverage corporation headquartered in the United States.e. Switzerland.November 25th. Hershey. Jacobs. has been put in charge of powdered beverages.[4] It markets many brands in more than 155 countries. Maxwell House. an internal candidate. Philadelphia Creme Cheese. products (i. Cadbury. Oscar Mayer. gum and candy. Nestle SA * Lower consumer discretionary spending . besides heading strategy. SWOT ANALYSIS ON Kraft Foods .now manage the chocolate portfolio. Illinois. Strengths * * * * * * * * * * Scale & positioning in key food categories Financial strength and business scale Diverse range of leading brands World%u2019s second-largest food company Approximately $50 billion in revenues Sales in approximately 160 countries 25% of global revenue from emerging markets #1 in global confectionery #1 in global biscuits More than 50% of global revenue from snacks and confectionery [*]has high quality of products Weaknesses * * * * * Difficulty launching new brands Most of growth is dependent on acquisitions or expanding into new markets Poor stock performance Low growth in United States Market Strong competition from Nestle. organic. food. replacing the American International Group. Milka. Oreo. Kraft is an independent public company. 40 of its brands are at least 100 years old. LU. health-focused) Value in leading brands Cadbury acquisition opens up new markets Cadbury acquisition provides new products Threats * Competition from Mars Inc. 11 of its brands annually earn more than $1 Billion worldwide: Kraft. and Trident.

we expect the operating environment to remain challenging.* Volatile resource costs. despite the soaring cost of ingredients. corn * Store branded products * Difficulty expanding into new markets * Poor implementation of Cadbury acquisition Advertisement Cadbury acquisition eats into Kraft Foods' profit 11 February 2011 179 Views The costs stemming from its acquisition of UK confectionary business Cadbury have prompted a 24 per cent drop in fourth-quarter profits for Kraft Foods.to high-teens and earnings per share (EPS) growth of 9 to 11 percent. presented its new global growth strategy at a meeting of analysts and investors in New York on September 15. Rising ingredient prices for commodities such as corn.5 billion.e. to $13. global categories and regional business units detailed the plan by which Kraft Foods will deliver organic revenue growth of 5 percent or more. Chief executive Irene Rosenfeld said the company's 2010 results represented solid progress and Kraft had ended the year with strong momentum. with significant input cost inflation and persistent consumer weakness in many markets. meat and beverage producer Sara Lee announced that company profits had more than doubled in its second quarter.2 percentage point contribution from Cadbury. also ate into the US food giant's earnings. "Looking ahead." said Irene Rosenfeld. margins in the mid. The comprehensive review of the company's power brands. which the firm purchased last February for £11. together with our significant presence in high-growth developing markets." she added. revenues across the entire Kraft Foods business increased by 30 per cent. . i.8 billion. sugar and cocoa. with net income falling to $540 million (£335 million) in the final three months of 2010. sugar. with a 26. chairman and CEO. will deliver consistent growth in the top tier of our peer group. Kraft Foods lays out new global growth strategy Kraft Foods Inc. "Today's Kraft Foods is a global snacks powerhouse with an unrivaled portfolio of leading regional and local brands. "This unique and complementary combination. Earlier this week. making it a top-tier performer in the global food industry. However.

by 2013. India and Mexico. More than half of Kraft Foods' revenue now comes from markets outside of North America." she added."At Kraft Foods. 2 positions in their respective categories and are household names among consumers who tend to be extremely brand-loyal. where GDP and demand growth . At the same time. The company has an exceptional portfolio of global Snacks power brands – led by Milka and Cadbury chocolates. 1 or No. Jacobs coffee and Tang powdered beverages. Roughly 80 percent of these "heritage" brands hold No. grocery. They also carry high margins and generate strong cash flow. crackers and nuts through multiple distribution channels." including Oscar Mayer meats. "We've built a solid foundation for growth. such as A-1 steak sauce in North America." Unique Combination of Snacks and Heritage Brands With the acquisition of Cadbury earlier this year. making strategic investments in marketing. the company will cultivate local brands. such as Brazil. Complementing the company's Snacks portfolio are well-loved iconic regional and local brands in the beverage. and snack-size cookies. a high-growth.in addition to $750 million in cost synergies ." Kraft Foods now offers dozens of brands of chocolate. Financial Transformation The combination of Kraft Foods and Cadbury provides the scale necessary to grow sales and distribution in new and existing markets. we're hitting our sweet spot. Oreo and LU biscuits and Trident gum – with leading market shares in every major region. sales and innovation and establishing a world-class cost structure. candy. from traditional groceries to convenience stores. Kraft Foods will continue to invest in marketing and innovation for the larger regional "power brands. cheese and convenient meals categories. a full pipeline of innovation and a clear opportunity to grow its presence in the point-of-purchase "hot zone. high-margin category that now accounts for more than half of the company's total revenue. delivering $1 billion in incremental revenue synergies . Dairylea cheese in the United Kingdom and Vegemite spreads in Australia. through flexible business models and nimble marketing. Kraft Foods became the undisputed world leader in Snacks. By leveraging our scale. China. we will take our performance to the next level. This combination of global powerhouse snacks brands and iconic heritage brands provides Kraft Foods with a unique capability to invest profit from stable cashgenerating businesses into high-margin categories and fast-growing Developing Markets. gum.

are strongest. Nabisco and LU biscuits. Philadelphia cream cheeses. the company is the world's second largest food company. and Oscar Mayer meats. Jacobs and Maxwell House coffees. margins in the mid. Milka and Cadbury chocolates. Accordingly. Approximately 70 brands generate annual revenues of more than $100 million.to highteens and EPS growth of 9 to 11 percent. Trident gum. the proportion of business in Developing Markets will increase from a quarter of total revenue to roughly one-third. Additional savings over the next three years from procurement. Standard & Poor's 500. dinners and dressings. by 2013. combined with flat overhead growth and pricing to offset input costs. will contribute to the expansion of gross margin. "This combination of factors gives us great confidence that our company will generate organic revenue growth of 5 percent or more. making delicious products for billions of consumers in approximately 170 countries. With annual revenues of approximately $48 billion. . These productivity gains. manufacturing and logistics will drive productivity gains in excess of 4 percent of cost of goods sold. "Delivering on these commitments will make Kraft Foods a sustainable top-tier performer in the global food industry. Kraft cheeses." said Tim McLevish. Kraft Foods is a member of the Dow Jones Industrial Average. Dow Jones Sustainability Index and Ethibel Sustainability Index." About Kraft Foods Kraft Foods is building a global snacks powerhouse and an unrivaled portfolio of brands people love. The portfolio includes 11 iconic brands with revenues exceeding $1 billion – Oreo. chief financial officer.

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