23rd
Feb
2011

Kraft Crafting New Ways To Save Consumers Money


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Kraft is a company that is adored by millions of Americans because of the many products made by them. Country Time Lemonade, A1 Steak Sauce, Cheese Nips, Maxwell House Coffee, DiGiorno Pizza, Lunchables, Teddy Grahams, Oreos, and Triscuits–these are just a couple of the brands and products produced by Kraft. They are popular, in part, because of their great taste–but also due to their low prices. Kraft is a rarity–a large company that cares about and caters to working families. Now, they are showing it:

“Half of our sales of meat and dairy products will be hit specially hard because of higher commodity prices,” Tony Vernon, president of Kraft Foods North America, told an industry gathering at the 2011 Consumer Analyst Group of New York conference (CAGNY) in Boca Raton, Florida.

To protect customers from having to pay more for its products Kraft executives said the company would try to shave costs on the business side.

Kraft is a company that rarely suffers from a lack of customer interest. People always want to buy their products, the question is whether they will remain affordable at times like this, when the costs of producing them rise–and Kraft is trying to ensure that they’ll remain affordable.


28th
Apr
2010

Oil: The Positive and Negative


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Crumbling credit ratings in Greece and Portugal have led to a third straight day of decline for oil prices. This fueled concerns that global demand for oil may be slow to rise over the coming months.However, there is reason to be optimistic about the oil market.

U.S. crude oil stockpiles increased 5.3 million barrels last week, the American Petroleum Institute said yesterday. Based on the industry group’s data, that’s the ninth weekly gain, bringing inventories to the highest since May 2009.

Gasoline inventories probably gained 800,000 barrels from 224.9 million in the previous week, the survey showed. Supplies of distillate fuel, including heating oil and diesel, are expected to have risen 1.5 million barrels from 148.9 million. Refiners likely maintained operating rates at an average 85.9 percent of capacity after five weeks of increases.

“Below $81 we will see some fresh buying,” said Hasegawa at Newedge. “Everyone is still expecting the world economy will rebound.”

I’d guess the oil industry will be rebound around the start of summer–not fully, but substantially.


19th
Apr
2010

Birth Control Battle Royale!


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It seems hard to remember a time before birth control pills–they revolutionized how we think about sex and reproduction. But, it’s also a big business–women have to purchase these pills every month, and they do so by the hundreds of millions. Now there is somewhat of a battle of the titans occurring in this industry.

The U.S. Food & Drug Administration approved it in 1960, and the next year, German giant Bayer introduced it in Europe. Bayer profited handsomely in the ensuing decades, tweaking its contraceptive formula and extending its patents. Even in 2009—with the global contraceptive market awash in cheap generics—the company pulled in about $1.7 billion on its branded birth control pills, Yaz and Yasmin.Now, Bayer faces competition of a different magnitude. Teva Pharmaceutical Industries (TEVA), the Israeli generic drugmaker known for its Pac-Man-like acquisitions of smaller competitors, aims to triple its annual sales in the category of women’s health to $1 billion as early as 2012. A large portion of the $650 million Teva needs to reach that goal is likely to come from birth-control products the company acquires in future deals.

It will be interesting to see if TEVA can accomplish this goal, or if they’re just talking big goals up to investors. This is a major market and one that is now expanding into the third world too.


9th
Feb
2010

Disney Posts Strong Earnings


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You just won the (insert title here)! What are you going to do next? The inevitable and enthusiastic reply is “I’m going to Disney World!” Well, that phrase has stayed so popular because of the universal recognition of their name and brand. Walt Disney Co. has reported a stronger-than-expected quarter, surprising investors and commentators alike. The gains came mostly on the back of their channel performing so well.

Walt Disney Co (DIS.N) has reported a stronger-than-expected quarterly profit, as its cable TV division turned in another star performance and cost-cutting provided some much-needed support for its film studio.

Disney shares rose as much as 2 percent on Tuesday after the earnings report, which followed what is becoming a familiar pattern for media companies: News Corp (NWSA.O) and Time Warner Inc (TWX.N) also reported better-than-expected results this month. For all three, the strength of cable TV can be credited.

Performances like this just prove that Disney is only going to grow over the next couple of years. Their brand has been carefully cultivated and can experience success even in the midst of a recession.


4th
Dec
2009

Airline Bidding War


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Delta Air Lines and American Airlines have been engaged in a bidding war for Japan Airlines Corp. That company is one of the most successful in Asia, and easily the most profitable airline in Asia. American Airlines topped Delta Air Lines’ bid with a $1.1 million offer.

American and Delta are openly wrangling over the unprecedented chance to invest in JAL, Asia’s leading carrier by revenue and a former prized national asset. In a country where negotiations are traditionally handled discreetly and behind closed doors, the public mudslinging has transfixed and, at times, befuddled the Japanese. The two US airlines held dueling press conferences Thursday, both loaded with criticism about their rivals’ plans and capabilities.

This represents a foothold in the fastest expanding airline market in the world, an opportunity that both Delta and American are desperate to get a crack at. Japan Airlines has experienced an unprecedented dip in revenues which have forced them to seek investors, even while they’re cutting costs.