Food & Food Service
IRI Update: Environment Still
Challenging
Noteworthy Highlights (4 weeks ending 7/12/09)
K cereal sales declined on tough comps: As
expected, K saw volume decline by 5.1% in cereal on
tough comparables. While pricing (+4%) acted as an
offset, total cereal sales declined by 1.3%.
GIS outperformed competition in soup and cereal,
underperformed in yogurt: With avg pricing growth
exceeding CPB’s in soup, GIS posted 5.9% volume
growth and reported healthy sales gains of 8.0%, In
cereal, GIS dollar sales increased by 5.7% on 6.9%
volume growth, though prices were 1.1% lower YoY and
comps were soft. However, GIS sales declined in yogurt
as a result of lower prices, volume declines, and
potentially lower merchandising (-6.6%).
KFT fundamentals continue to be weak: Kraft lost
market share in 7 of the 11 categories that we track, and
volumes increased only in categories in which price
decreased YoY.
CPB soup data disappoints again: Continued volume
declines (-2.0%) and below average pricing growth
(1.3%) resulted in sales declines (-0.7%) and market
share losses (-1.4%) in soup, potentially a result of
decelerating merchandising growth (i.e., merchandising
growth in the most recent 4 weeks slowed relative to the
most recent 12 weeks).
HSY shows sequential improvement, though
volumes still declining: 4 week volume declines in
chocolate (-10.7%), non-chocolate food (-2.1%), and
confectionary (-8.2%) were less severe than 12 week
declines (though, still negative). Data continues to
suggest that Mars has not followed HSY’s lead in raising
prices, which we expect could hamper volume
improvement going forward.