The Kraft Heinz Co. reported better-than-expected first-half 2019 adjusted EPS on Aug. 8 as the company wrote down the value of several business units by $1.22 billion.
Adjusted EPS for the company's fiscal first quarter of 66 cents beat the S&P Global Market Intelligence mean consensus estimate for normalized EPS of 61 cents, while the second-quarter result of 78 cents beat the estimate of 75 cents. Still, total first-half EPS of $1.44 is less than the $1.89 that the company posted for the same period in 2018.
Kraft Heinz reported net income attributable to shareholders for the six months to June 29 of $854 million, down 51% year over year.
The company booked a noncash impairment charge of $744 million across portions of its operations in Europe, the U.S., Brazil and Latin America, as well as another $474 million as a result of "the application of a higher discount rate to reflect the markets' perceived risk in the Company's valuation."
Net sales at the maker of Grey Poupon mustard and Velveeta cheese sauce declined 4.8% to $12.37 billion for the first half of the year. Organic net sales decreased by 1.5% over the year-ago period.
The report marked Kraft Heinz's first since February, when the food company wrote down the value of some of its largest brands, such as Oscar Mayer and Kraft Natural Cheese, by $15.44 billion. The company also cut its dividend and disclosed an SEC investigation into its procurement accounting.
Since then, Kraft Heinz has put off submitting key quarterly and annual filings to the SEC as well as releasing quarterly results. In May, the company restated some figures going back to 2016.
"The level of decline we experienced in the first half of this year is nothing we should find acceptable moving forward," CEO Miguel Patricio said in a statement.
Shares of the company were 6.9% lower at $28.74 in premarket trading. Kraft Heinz reported results before U.S. markets opened Aug. 8.