(RTTNews) - Food maker Kraft Foods Inc. (KFT: News ), which is attempting to buy British chocolate giant Cadbury Plc (CBY, CBRY.L, CDSCF.PK), is scheduled to report third-quarter results after the market closes on Tuesday. On average, 14 analysts polled by Thomson Reuters expect the company to earn $0.48 per share for the quarter, with estimates ranging from $0.45 to $0.53 per share. Third-quarter revenues are estimated to be $10.32 billion. Analysts' estimates typically exclude special items.

For the third quarter of 2008, Kraft reported net earnings of $1.398 billion, a surge from $596 million reported for the same quarter in the prior year, helped by a one-time gain of $860 million from the exit of the Post cereal business. Earnings rose to $0.93 per share from $0.38 per share in the third quarter of 2007. Excluding items, earnings stood at $0.44 per share. Net revenues increased 19.4% to $10.462 billion.

The Northfield, Illinois-based company manufactures packaged food products and grocery products. Its offerings include Kraft cheeses, Oscar Mayer meats, Philadelphia cream cheese, Maxwell House and Jacobs coffee, Milka chocolates and LU biscuits. Kraft Foods, with about 100,000 employees and annual revenues of $42 billion, is the world's second largest food company.

Although the tough economy is reflecting on all sectors, food makers are benefiting from the eat-at-home trend. The reduction in ingredient costs is another positive factor for these companies.

In July, Kraft reported an 11% increase in its second-quarter profit, driven by solid performance across all geographies, improved product mix and lower costs due to the completion of the 2004-2008 restructuring program. Net earnings attributable to Kraft Foods were $827 million for the second quarter, up from $745 million in the prior year quarter. Earnings per share rose to $0.56 from $0.49 in the previous year quarter. Second quarter net revenues declined 5.9% to $10.2 billion from $10.8 billion in the same quarter last year. Organic net revenues grew by 2.9%, driven by pricing and volume/mix.
Kraft also raised its earnings outlook in July to at least $1.93 per share from its prior expectation of $1.88 per share. The company said it continues to expect 2009 organic net revenue growth of about 3%. The food maker is likely to update this forecast today.

The company also may announce improvements in operating margins, helped by declines in commodity costs.

Early September, Kraft made a proposal to acquire Cadbury for about GBP 10.2 billion, but Cadbury's Board rejected the offer immediately, stating that the proposal fundamentally undervalued the company and its prospects. The offer was for 300 pence in cash and 0.2589 new Kraft Foods shares per Cadbury share, valuing each Cadbury share at 745 pence representing a 31% premium to Cadbury's September 4 closing share price of 568 pence. The acquisition will help Kraft expand its presence in several growing markets.

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