KHC - Kraft Heinz backs prior guidance lowers leverage target

Kraft Heinz ( NASDAQ: KHC ) reaffirmed prior guidance ahead of an appearance on Wednesday by execs at the Barclays Global Consumer Staples Conference.

For the long-term, Kraft sees organic sales growth of 2% to 3%, adjusted EBITDA growth of 4% to 6%, and adjusted EPS growth of 6% to 8%.

For FY22, Kraft Heinz ( KHC ) continues to expect organic sales growth in the high single digits and adjusted EBITDA to be in the range of $5.8B to $6.0B vs. $5.92B consensus.

On the capital allocation front, the food company updated its long-term net leverage target ratio from consistently below 4X to approximately 3X. With interest rates 100% fixed with a weighted average maturity of 14.5 years, and leverage meaningfully improved, KHC believes this level will provide it with a strong balance sheet through cycles and sufficient financial flexibility. The KHC outlook now contemplates inflation for the full year of approximately 20%, up from the previous expectation for inflation to be in the high teens.

Shares of KHC fell 0.48% premarket to $37.35.

The Seeking Alpha Quant Rating on KHC is Hold.

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