US food firm Kraft has announced that it expects its underlyingnearnings to increase by 9% in 2012 after it posted strong revenuenand earnings growth for 2011. During the year the firm was bolsterednby a strong performance in developed markets, with revenues upnby 8.9% in North America and 7.5% in Europe. However, the company'snperformance in developing markets was disappointing, withnsales up by just 2.4% and Kraft attributing this lacklustre result tonvolatile market conditions. Operating margins were up by 9.7% onnan underlying basis, representing a strong result against a backdropnof weak consumer confidence and increased commodity costs. Thesenresults mean that it is unsurprising that the firm outperformed BMI'snfood index during the year (see chart), although it is clearly crucialnfor Kraft to get its emerging market business performing better ifnthis outperformance is to be maintained.
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