Kraft spent $207.3m on Cadbury NZ as part of global takeover
BUSINESSDESK: Global food manufacturer Kraft Foods spent $207.3 million on Cadbury's New Zealand operations as part of its £11.9 billion takeover of the chocolate maker in 2010, financial statements show.
The Cadbury assets dominated earnings for Kraft's New Zealand holding company, Kraft Foods Investments (NZ), which reported a profit of $3.5 million in calendar year 2011, the first result for the amalgamated entity.
Revenue of $316.6 million compares to Cadbury's 2010 sales of $274.1 million.
New Zealand sales last year made up about 1.4% of Kraft's $US15.82 billion revenue in developing markets, which includes the Asia Pacific region.
Kraft says increased regional sales came from higher pricing across the region, the Cadbury acquisition and more favourable exchange rates.
The cash consideration valued Cadbury's goodwill at $43.8 million, according to the financial statements. Kraft's New Zealand unit had $87.6 million in share capital as at December 31.
The New Zealand unit spent a further $1.1 million on the Cadbury restructuring initiative to lay off about 145 staff and introduce automated manufacturing systems. The move was announced in August 2008 and is expected to be completed this year.
Restructuring has cost Kraft and Cadbury a total $25.3 million over the past five years, according to their statements.
The global business cited the Cadbury takeover as a reason for increased revenue across the board in its 2010 and 2011 financial years, and it boosted first-quarter sales 4.1% to $US13.1 billion in the first three months of this year.
Last month, Kraft quit its New York Stock Exchange listing in favour of the Nasdaq in a bid to cut costs.
That comes ahead of its planned demerger, where it will spin out and separately list its North American grocery business, which will keep the Kraft name, while the global snack foods business will operate under Mondelez International.
Kraft's shares rose 0.8% to $US39.21 in trading in New York on Monday, valuing the company at $US69.52 billion.