H.J. Heinz Company
P.O. Box 57
Pittsburgh, PA 15230-0057
To read our full Corporate Social Responsibility Report visit:
www.Heinz.com/CSR2011
“Our Global Sustainability Process has put Heinz
on track to achieve or surpass our goal of reducing
greenhouse gas emissions, solid waste, energy
consumption and water usage by at least 20% by
Fiscal Year 2015.”
Table of Contents
Environment
Social
Economic
Approach
Pages 2-6
Pages 9-16
Pages 17-18
Page 19
17 Fiscal Year 2011
Summary
19 Our Approach to
Corporate Social
Responsibility
2 Packaging Innovation
4 Sustainable
Agriculture
6 Environmental Goals
9 Making Social
Responsibility a
Core Value
17 Financial Strategy
Henry John Heinz, a pioneer in the packaged foods
iron-deficiency anemia in children by developing and
industry, started this Company in 1869 with a strong
distributing micronutrient powders that provide essential
18 Customer
Satisfaction Leader
commitment to quality, integrity and social responsibility.
vitamins and minerals.
18 Expanding the
Core Portfolio
extremely proud of how we have carried on his legacy by:
Economic Performance
• Building a Company that is committed to the sustainable
In Fiscal Year 2011, Heinz delivered record sales of
10 Heinz Micronutrient
Campaign
18 Accelerating Growth
in Emerging Markets
12 Food Safety
12 Healthier Foods for
Healthier Lifestyles
14 Diversity & Inclusion
A Message from Our Chairman, President and CEO
14 Labor Relations
More than 140 years later, I believe our founder would be
$10.7 billion as well as record net income and higher
health of people and the planet;
14 People Development
15 Employee Health
and Wellness
• Delivering profitable growth for our shareholders; and
earnings per share. Heinz also increased the annualized
• Conducting business with integrity and transparency.
common stock dividend by 14 cents over the last two
fiscal years to $1.80 – a total increase of more than 8%.
15 Workplace Safety
16 Heinz Employees
Making a Difference
This publication contains highlights from our 2011
Lastly, Heinz approved an additional increase of 12 cents
Corporate Social Responsibility Report, which can be
per share to $1.92 for Fiscal Year 2012.
viewed online at www.Heinz.com/CSR2011. Here are
Health & Wellness
some highlights from the two-year reporting period.
Heinz continued to expand its focus on Health & Wellness
About the Cover
Spread
About Heinz
The images on the cover and
most global of all U.S.-based food companies. Famous
inside cover spread illustrate
for our iconic brands on six continents, Heinz provides
the Company’s focus on
delicious, nutritious and convenient foods for families
these five high-priority areas,
in 200 countries around the world. In more than 50 of
based on a materiality
those countries, we enjoy the number-one or number-
analysis that was conducted
two market position. Our core products include ketchup,
in the development of this
sauces, meals, snacks and infant/nutrition.
Headquartered in Pittsburgh, Pennsylvania, Heinz is the
2011 Corporate Social
Responsibility Report: Healthful Products, Greenhouse
At any given moment, the 35,000 employees of Heinz
Gas Emissions, Sustainable Agriculture, Food Safety
are hard at work creating new products, perfecting fresh
and Innovation. On the cover: Actress Lucy Liu, a
ideas, and developing nutritious and innovative foods for
spokesperson for the Heinz Micronutrient Campaign,
today’s families. Heinz is a trusted name for consumers
during a trip to China to observe the Company’s
and a valued partner in the community.
signature non-profit CSR program in action.
Environmental Progress
through new products that are tailored to healthy lifestyles
Our Global Sustainability Process has put Heinz on track
and initiatives like our voluntary sodium reductions.
to achieve or surpass our goal of reducing greenhouse
gas emissions, solid waste, energy consumption and
We can all be proud of our Company’s environmental,
water usage by at least 20% by Fiscal Year 2015.
social and economic performance and our track record
of providing safe, high-quality foods for consumers. Heinz
Separately, we have launched fully recyclable Heinz
®
is committed to engaging our stakeholders and operating
Ketchup bottles using innovative PlantBottle packaging
with the highest degree of integrity and transparency as
technology from The Coca-Cola Company. Unlike
we strive to meet your expectations and achieve
traditional plastic bottles made from non-renewable fossil
our goals.
™
fuels, up to 30% of the PlantBottle material comes from a
renewable source – plants.
Sincerely,
Social Responsibility
Our non-profit Heinz Micronutrient Campaign is
expanding its global reach and its mission of addressing
William R. Johnson
H.J. Heinz Corporate Social Responsibility Highlights 2011
1
Environment
PlantBottle
Packaging
™
Packaging Innovation
Our focus on innovation includes an increasing emphasis on packaging
that will help Heinz reduce our environmental footprint.
Up to 30% material
from renewable
sources Fully recyclable
In February 2011, Heinz announced a groundbreaking
This landmark agreement enables us to manufacture
partnership with The Coca-Cola Company that exemplifies
fully recyclable Heinz® Ketchup bottles using innovative
our strong commitment to environmental responsibility.
PlantBottle™ technology developed by The Coca-Cola
Company. The PlantBottle packaging is a step forward
for the environment because up to 30% of the packaging
material comes from a renewable source – plants –
unlike traditional PET plastic bottles made from
non-renewable fossil fuels. The material is produced
through an innovative process that turns natural sugars
found in plants into a key component for PET plastic.
PlantBottle™ Packaging Conversion
Heinz Ketchup is going to convert to PlantBottle
packaging globally over time, starting with a U.S. rollout
of more than 120 million retail and foodservice bottles
that began in 2011 with our best-selling 20-ounce variety
of Heinz Ketchup. Heinz is supporting the PlantBottle
packaging launch with a campaign that is raising public
awareness of its environmental benefits. In Fiscal Year
2012, we expect to introduce PlantBottle packaging
in Europe.
Heinz believes that our collaborative partnership with
The Coca-Cola Company will help us make a positive
difference for the environment while exciting our
consumers and our retail trade partners.
Muhtar Kent, Chairman and CEO of The Coca-Cola
Company, and William R. Johnson, Chairman,
President and CEO of H.J. Heinz Company
Adoption of the PlantBottle technology will be the biggest
change to our iconic Heinz Ketchup bottles since we
introduced our first plastic bottles in 1983.
2
H.J. Heinz Corporate Social Responsibility Highlights 2011
3
Environment
Since Fiscal Year 2005,
Chinese farmers trained by
Heinz agricultural specialists
Sustainable Agriculture
ainable Agriculture
Goal
Sustainable Agriculture –
15% reduction of water usage,
15% reduction of carbon
footprint and improvement
of tomato crop yields by 5%
through the use of hybrid
tomato seeds by 2015,
compared to a Fiscal Year
2005 baseline.
*As of Fiscal Year 2011
On Target
Before
2003: Typical tomato crop in early September,
from direct seeding, local technology
Percentage
Use of Drip
Irrigation
in Tomato
Crops
75%
50%
New Zealand
Canada
USA
China
Portugal
in their tomato crop yields.
After
Today: Typical tomato crop in early September, from Heinz technology, hybrids & plug transplants
Global Agriculture Program (GAP)
HeinzSeed
Our tomato experts travel the globe as part of an
With our own proprietary tomato seeds and traditional
extensive education initiative to teach farmers how to
breeding techniques (no genetic modification),
grow tomatoes more efficiently and sustainably. GAP
HeinzSeed helps farmers adhere to a more sustainable
is based on the principle of creating a long-term farm
agriculture program. HeinzSeed tomatoes remain
management philosophy that is equally focused on
ripe longer when stored in the field. They provide a
productivity, environmental stewardship and prosperity.
combination of disease-resistance and high yield, which
When these best practices are properly implemented,
allows farmers to harvest more tons with less chemicals,
our growers report that their farming operations have
water and fertilizer.
become more economically, environmentally and
socially sustainable.
California Tomato Yields*
Metric Tons per Hectare
93
81
80
91
FY05
FY06
FY07
FY08
94
FY09
97
102
FY10
FY11
* USDA production for California (HeinzSeed Majority Share)
Heinz is demonstrating leadership in sustainable
Tomatoes are one of the world’s largest crops, and Heinz
uses more processed tomatoes –
approximately 3.1 million
raw equivalent tons per year –
than any other company
in the world.
4
68% increase
100%
90%
3%
Progress*
Since 2005, drip irrigation
technology has increased to
nearly 100% use in many of
the tomato growing regions.
Global yields have improved
with a range of 3% to 68%
and we have implemented
a program to track and
measure our carbon footprint.
have seen a
tomato farming through our global agriculture
training programs, our HeinzSeed natural tomato
breeding program and expanded partnerships in
reducing our carbon footprint. These initiatives are
enhancing the quality of tomatoes for Heinz
products while making a sustainable difference
for the environment and our growers.
Realizing Water
Reductions with
Drip Irrigation
Since Fiscal Year 2005, the use
of drip irrigation in California
has grown from 30% of total
acreage to nearly 75% at the
end of Fiscal Year 2011.
Our Pledge
Heinz will continue to develop
superior-quality tomatoes and
deliver tomato products to
consumers while working with
tomato growers to institute even
more productive, efficient,
safe and sustainable
agricultural practices.
H.J. Heinz Corporate Social Responsibility Highlights 2011
5
Environment
Heinz Sustainability Goals by 2015
6.1%
9.3%
13.1%
800
Reduction
in Energy
Consumption
(KWh per metric ton (MT)
production)
600
200
0
On Target
GOAL:
20%
PROGRESS
15.1%
400
FY15
* As of Fiscal Year 2011
5.7%
FY11
Since 2005, we’ve reduced
our Energy Consumption
by 15.1% globally.
3.5%
FY10
Reduce Energy
Consumption 20%
by Fiscal Year 2015.
0%
FY09
Progress*
FY08
Goal
FY07
Heinz is on track to achieve or surpass our
goal of reducing greenhouse gas emissions,
energy consumption, water usage and solid
waste by at least 20% by Fiscal Year 2015.
Energy Consumption
Energy
ConsumptionReductions
Reductions
FY06
Heinz is making a difference as a global food
company that is reducing our environmental
footprint and protecting the planet’s natural
resources for future generations.
FY05
Greenhouse Gas 20% ▼
Energy 20% ▼
Renewable Energy 15% ▲
Packaging 15% ▼
Water 20% ▼
Transportation (Fossil Fuel) 10% ▼
Agriculture: GHG 15% ▼
Water 15% ▼
Yield 5% ▲
Solid Waste 20% ▼
Engage Employees
▲
Baseline year
Reduction in Absolute
Energy Consumption
Using less energy is smart business because it benefits the planet
and the Company. By addressing and reducing energy consumption,
Heinz can mitigate the financial impacts of rising energy costs, reduce
GHG
GHGEmission
EmissionReductions
Reductions
Goal
Progress*
Greenhouse Gas
(GHG) Emissions –
Overall 20% reduction
per metric ton of
production by Fiscal
Year 2015.
Since 2005, we have
reduced our GHG emissions
by 13.2% per metric ton
of production globally.
3.8%
4.7%
6.4%
9.4%
12.8%
FY05: 3,867,774 MWh
greenhouse gas emissions and eliminate inefficiencies in our factories
FY11: 3,338,021 MWh
and offices around the world.
PROGRESS
13.2%
Percentage
Reduction
per Unit of
Production
GOAL: 20%
Solid Waste
Waste Reductions
Solid
Reductions
* As of Fiscal Year 2011
On Target
FYO6
FYO7
FYO8
FYO9
FY10
FY11
Heinz is making progress to reduce GHG emissions per unit of production through the continued implementation of our Global Utility
Optimization Program that is fine-tuning manufacturing and environmental processes, upgrading equipment and installing improved technology.
Goal
Progress*
Reduce Solid
Waste 20% by
Fiscal Year 2015.
Since 2005, we’ve reduced
our Solid Waste generation
by 45.6% per 100 metric
tons of production globally.
An added benefit of these projects is a 2% to 4% reduction in energy consumption and GHG emissions per year per factory.
*As of Fiscal Year 2011
Exceeding Target
Waste Generation
Metric tons
0%
Goal
Reduce Water
Consumption 20%
by Fiscal Year 2015.
Since 2005, we’ve reduced
our Water Consumption
by 21.8% globally.
8
REDUCTION
GOAL: 20%
59,544
metric tons
106,006
FY05
104,635
FY06
97,480
92,584
FY07
FY08
76,312
FY09
65,179
FY10
FY11
8.41
8.19
GOAL: 20%
8.03
7.53
Our success in delivering solid waste reductions more than twice our goal was a direct result of our Sustainability Process, which taps
a comprehensive network of Regional Sustainability Coordinators that share best practices in resource management and recycling with
6.79
6.75
21.3%
21.8%
PROGRESS
21.8%
our facilities.
(m /MT of production)
3
0
Exceeding Target
PROGRESS
45.6%
27.8%
reuse or recycle to divert solid waste from landfills.
Progress*
*As of Fiscal Year 2011
15.9%
Every stage of the supply chain presents an opportunity to eliminate waste. Our employees are focused on finding new ways to reduce,
8.63
Reduction
in Water
Consumption
11%
38.3%
Baseline year
Water
ConsumptionReductions
Reductions
Water Consumption
2.8%
0%
FY05
2.5%
FY06
5.1%
FY07
7%
FY08
12.7%
FY09
FY10
FY11
Every Drop Matters
Heinz is currently exceeding the Company’s goal to reduce water consumption through a wide range of actions from recycling water and
installing new technologies to upgrading water treatment plants. We continue to seek additional water conservation opportunities.
6
H.J. Heinz Corporate Social Responsibility Highlights 2011
7
Social
Environment
Making Social Responsibility
a Core Value
Transportation
Transportation
Goal
5.7%
35
Fossil Fuel Use
in Canada,
Latin America
and UK/Ireland
GOAL: 10%
30
The men and women of Heinz are the Company’s
25
Latin America
Canada
UK/Ireland
20
15
10
5
* Data represents +/- 80%
transported products.
FY11
(Reduction of liters of transported fuel per weight)
FY10
10% reduction per unit
of fossil fuel consumption
through improved
efficiency of our product
distribution network
by 2015.
PROGRESS
40
0
greatest asset. We are dedicated to ensuring their
dignity, health and safety on the job while providing
competitive wages and equal opportunity. Heinz is also
committed to the sustainable health of consumers who
trust our Company to manufacture safe, high-quality,
Moving Forward on Transportation
great tasting, nutritious foods. Finally, we continue
Effective management of our comprehensive transportation network is one of the keys to reducing fossil fuel consumption and greenhouse
to build on our enduring legacy of being a good
gas (GHG) emissions in transportation. Heinz is focused on continuously improving the efficiency of our transportation network while working
corporate citizen in the communities where we operate.
closely with our logistics carriers to meet our global goal of a 10% reduction in fossil fuel consumption and GHG emissions per unit of production.
Reflecting our focus on being a socially responsible
employer that puts people first, we are making a world
of difference in the global community through the
H.J. Heinz Company Foundation, the Heinz
Renewable Energy
Energy
Renewable
Micronutrient Campaign and voluntary initiatives
Increase Renewable
Energy 15% by Fiscal
Year 2015.
where our employees contribute their time, talent and
31.0%
Goal
Aligarh, India Facility
Percentage of Renewable
Energy Usage
H.J. Heinz Company Foundation
24.2%
FY07
Aligarh, India
resources to assist people and communities in need.
58,290
Total Company giving for
Fiscal Years 2010 and 2011
was $12.8 million.
The H.J. Heinz Company Foundation strives to make
FY11
metric tons of rice husks
a positive impact in the global community through
strategic investments to improve nutrition, foster
healthy communities and promote diversity in areas
where our employees live and work. The Foundation
makes a difference in thousands of lives each year with
our signature CSR program – the Heinz Micronutrient
Campaign; through our strategic grants program; and
by supporting employee volunteerism.
used as alternative fuel source FY05-FY10
Effective Renewable Energy Projects
Heinz continues to evaluate opportunities to utilize renewable energy resources
such as biofuels, solar power, water, food and waste.
We are currently constructing a new biomass boiler in our Quero® factory in
Nerópolis, Brazil. Installation of this boiler, which uses sugar cane bagasse,
eucalyptus chips and corn straw for fuel, will allow us to reduce our annual
greenhouse gas (GHG) emissions by approximately 50% at this facility.
8
H.J. Heinz Corporate Social Responsibility Highlights 2011
9
Social
Heinz Micronutrient Campaign
QUESTION&ANSWER
The HMC is focused on creating sustainable models and partnerships with governmental agencies and NGOs, as it is
doing in Cambodia, China, Haiti, India, Indonesia and Tanzania. The Campaign is also raising awareness of micronutrient
malnutrition with the support of actress and humanitarian Lucy Liu.
Is iron-deficiency anemia a
formulated to be effective when
caregivers are properly trained in
global health threat?
stirred or mixed into children’s foods.
the use of micronutrient powders.
Yes. The World Health Organization
The Heinz Micronutrient Campaign (HMC) is a groundbreaking nonprofit initiative that gives children a fighting chance to live healthier lives
by developing and distributing nutritious powders and other innovative
products that treat and prevent iron-deficiency anemia.
Working with non-governmental organization partners and
expand the HMC to the United States and introduce a
government agencies since 2001, the HMC has provided
new bean paste targeted to children who are moderately
these life-changing supplements to 3.5 million children in
malnourished. The HMC continues to sponsor the
15 developing countries.
development of cost-effective new products to treat
anemia, such as reduced-iron NutureMate™, which has
In the last two years, the HMC expanded to Africa
proven to be effective in treating malnourished children in
and Haiti for the first time. Ahead for 2012, we look to
malaria-endemic regions.
10
Training materials are developed and
estimates that 2 billion people –
Does Heinz manufacture
nearly one-third of the global
micronutrient powder?
population – are anemic, primarily
Yes. The non-profit HMC provides
Is it costly to prevent and treat
due to lack of iron. The HMC is
sachets of micronutrient powder
iron-deficiency anemia?
focused on the treatment and
that are manufactured by Heinz.
No. Working through collaborative
prevention of iron-deficiency anemia
The World Health Organization and
partnerships in countries around the
in children.
UNICEF have approved the sachets
world, the HMC is addressing iron-
as a cost-effective treatment for iron-
deficiency anemia at an annual cost
What is micronutrient powder?
deficiency anemia. About 60 sachets
of just $1.50 per child.
Micronutrient powder is a multi-
are required over a three- to four-
vitamin blend, including iron, zinc,
month period to treat and prevent iron
The H.J. Heinz Company Foundation
vitamin A, folic acid and other
deficiency.
has contributed more than $5 million
delivered in local languages.
essential nutrients, that promotes
directly in cash contributions and
healthy physical and mental
What makes the HMC unique is that
additional in-kind donations have
development. The tasteless powder
the H.J. Heinz Company Foundation
been contributed by the Company.
supported by the HMC is specially
works with its partners to ensure that
H.J. Heinz Corporate Social Responsibility Highlights 2011
11
Social
In Heinz North America, it is our goal that 100% of total new
product innovations in 2011 will meet our strict criteria for healthy
nutrition innovation.
Food Safety
Our Company’s enduring commitment to food safety and
quality assurance is rooted in the vision and values of
our founder, Henry John Heinz, a prominent advocate
for the adoption of the Pure Food and Drug Act in 1906.
Healthy New Products
Heinz has manufacturing and food safety practices and
processes that are designed to ensure that our food
products meet stringent quality and safety specifications.
In Fiscal Years 2010 and 2011, Heinz launched dozens of
new products through our four Health and Wellness platforms:
Henry John Heinz
Heinz has a highly trained team of supplier auditors
around the world that consistently enforces Heinz quality
and food safety standards. Our goal at all times is to
maintain compliance levels at 100%. Heinz also shares
best practices with our Emerging Markets businesses to
drive consistently high food safety standards around the
world. These best practices were developed in markets
like the United States and Europe, where Heinz has a long
and distinguished track record of food safety.
Healthier Foods for Healthier Lifestyles
1. Better for You
3. Weight Management
Our Better for You platform
includes foods that are
the focus of our ongoing
initiative to reduce sodium
and sugar and eliminate
trans fats. This platform also
includes products such as
meals and snacks that we
are enhancing to deliver
higher nutrition by adding
vegetables and whole grains.
Weight Management
includes the Weight
Watchers Smart Ones
brand of nutritional meals,
snacks and desserts in
the U.S. and Canada,
as well as the Weight
Watchers from Heinz
product line in Europe.
2. Growth and Development
4. Health Management
Growth and Development
includes infant and toddler
foods and children’s beverages.
Health Management encompasses
products that Heinz has developed
specifically for consumers with
certain medical conditions.
• In Italy, Heinz produces
gluten-free products for
individuals with celiac disease
or sensitivity to gluten.
• We also offer low-protein products
for consumers who must restrict
protein consumption, such as
people with kidney disease.
Heinz is advancing our Health and Wellness mission by
making foods for healthier lifestyles.
•T
he majority of our global portfolio is centered around
nutritious foods made with tomatoes, beans, fruits and
vegetables.
•H
einz is a leader in the nutritional/weight management
category, with Weight Watchers® Smart Ones® and
Weight Watchers from Heinz branded products.
®
®
• As the world’s fifth-largest manufacturer of baby food,
Heinz offers a growing line of wholesome, nutritional
products for infants and children.
In Fiscal Year 2010, Heinz reduced sodium across our
U.S. retail ketchup line by 15%. This voluntary reduction
put Heinz in the forefront of the U.S. National Salt
Reduction Initiative, a public-private partnership aimed
at reducing people’s salt intake.
12
H.J. Heinz Corporate Social Responsibility Highlights 2011
13
Social
Diversity and Inclusion
Our Vision is that Heinz is
recognized as a diverse and
inclusive organization, retaining
superior talent and leveraging
diversity to improve Heinz’s
business results, image and
employee satisfaction.
Labor Relations
Employee Health and Wellness
Heinz strives to meet the healthcare needs of an ethnically
In the United States,
and geographically diverse global workforce through a
Heinz has been
wide range of programs that emphasize healthy choices,
recognized by the
diligent healthcare decision-making
National Business
and active participation in our
Group on Health for
wellness programs.
three consecutive
years as one of the
Heinz strives to maintain a good working relationship with labor
unions across each of our Business Units. The Company has a
history of negotiating fair and competitive contracts that provide
family-sustaining jobs and wages.
—Heinz Inclusion Council
People Development
Heinz Scholars Program
The Heinz Scholars Program is a unique partnership with
Developing strong leaders at every level of the
Washington & Lee University in the United States. Heinz
organization is important at Heinz because “Making
awards annual scholarships and internship opportunities
Talent an Advantage” is one of the four strategic pillars
to minority students who have distinguished themselves
of the Company’s long-term growth plan.
through academic and personal achievements.
Heinz Chairman, President and CEO William R. Johnson
In New Zealand, our Wattie’s
“Best Employers for Healthy
business received the Workfit
Lifestyles.” In 2010, Heinz was
Award from the Hawkes Bay
also one of six companies to win that organization’s award
Chamber of Commerce in 2010.
for “Innovation in Reducing Healthcare Disparities.”
The award reflected the diverse
Heinz was recognized for providing healthcare benefits
scope of employee wellness
and programs that meet the needs of a culturally
programs offered at Wattie’s.
diverse workforce.
Workplace Safety
Safety Is a Priority at Heinz Facilities Worldwide
Heinz is strongly committed to protecting the health and
guidelines that meet or exceed industry standards in the
commissioned a study that collected and shared valuable
safety of each of our employees. The Company maintains
countries where we manufacture. Our stringent efforts
lessons and insights on leadership from more than two
a comprehensive safety management system and requires
to keep our facilities safe are generating positive results
dozen CEOs of other major companies.
each of our production employees to adhere to strict safety
globally.
The study’s findings were turned into a book titled
“Preparing CEOs for Success – What I Wish I Knew,”
with the foreword written by Mr. Johnson. This book
Global Total Recordable Incident Rates (TRIR) continue to trend downward – 49% decrease in 6 years
was published in 2010, and proceeds from the book
sales were donated to Ronald
McDonald House Charities, Inc.
Total Company TRIR
Our current Company Total
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
Total Company TRIR
1.64
Company
TRIR
Recordable Incident Rate
(TRIR) is 1.64 and has improved
considerably over the last six
GOAL:
1.0 TRIR
years, indicating that we’re well
on our way to achieving our goal
of a <1.0 TRIR.
FY06
FY07
FY08
FY09
FY10
FY11
In Fiscal Years 2010 and 2011, Heinz continued its
commitment to this program by hiring 100% of eligible
graduates into full-time positions.
14
H.J. Heinz Corporate Social Responsibility Highlights 2011
15
Social
Economic
Heinz Employees Making a Difference
Fiscal Year 2011 Summary
Pedaling in the Alps to Combat Cancer
In Fiscal Year 2011, Heinz delivered record
In 2011, 16 Heinz employees from the Company’s
sales, net income and operating free cash flow1
facility in Zeist, The Netherlands, hopped on bicycles
while completing key acquisitions in Brazil and
and pedaled up the French Alps to raise funds for
China to accelerate our dynamic growth in
cancer research. The group joined more than 4,000
Emerging Markets. Heinz reported:
cyclists to “climb” the Alps six times in one day as part
• Record sales of $10.7 billion, propelled by
of Alpe d’HuZes, an annual event that helps to support
12% sales growth in Emerging Markets as
fundamental cancer research.
well as growth in our Top 15 brands and
Total Company
Net Income
Sales
$990
Million
$10.7
Billion
$10.5
Billion
$865
Million
global ketchup
• Record net income of $990 million, up more
The Pink Tomato Crusaders
than 14% from the previous year
More than six months of preparation culminated in
• Earnings per share from continuing
a medal-winning race for the 17 members of Heinz
operations of $3.06, up nearly 7%
Canada’s Dragon Boat crew – called The Pink Tomato
FY10
FY10
FY11
FY11
• Record operating free cash flow 1 of
Crusaders. Held across Canada, the Dragon Boat events
$1.26 billion.
raise much-needed funds for charity. Heinz Canada
employees teamed up to raise money for Breast Cancer
research. They plan to expand the initiative in 2012.
Financial Strategy
Heinz is focused on delivering consistent top-line growth and strong operating free cash flow 1 and returning a high
Heinz Australia has a longstanding partnership with
Heinz Venezuela
Supports Local
Communities
Ardoch Youth Foundation, a national not-for-profit
In San Joaquín, Venezuela,
organization that supports programs that reduce the
a group of employees
risk of students dropping out of school.
volunteer their time to
Helping Australian Students Stay in School
percentage of earnings to shareholders through a top-tier dividend.
Growing the Dividend
Cumulative Total Shareholder Return
Annual Dividend (1)
160
deliver goods and provide
Heinz donated Wattie’s soup and non-perishable goods
educational workshops and
along with hundreds of lunchboxes to Ardoch to kick-start
recreational activities that
their “Back to School” campaign in January 2011.
enhance the quality of life
$1.92
~80%
$1.66
Since FY04
Heinz
140
S&P 500
130
$1.68
120
110
$1.52
100
$1.40
of the local community.
90
Rosanne Osborn
(Ardoch Project
Coordinator)
receiving Heinz’s
donation of lunch
boxes to Ardoch
Youth Foundation.
$1.08
$1.14
80
$1.20
70
60
FY04
FY05
FY06
FY07
FY08
FY09
FY10
FY11
FY12E
* Represents activity through April 27, 2011.
FY06
FY07
FY08
FY09
FY10
FY11
(1) Annualized equivalent, declared quarterly
Heinz Returned More Than $3.5 Billion to Shareholders
1
16
$1.80
UP
150
Heinz TSR UP 46% Over Last Five Fiscal Years
Operating free cash flow is cash from operations less capital expenditures net of proceeds from disposal of PP&E.
H.J. Heinz Corporate Social Responsibility Highlights 2011
17
Economic
Accelerating Growth in
Emerging Markets
Approach
Customer Satisfaction Leader
Our Approach to Corporate Social Responsibility
#1 in Customer Satisfaction 11 Years Running!
Under our long-term plan, Heinz is accelerating our
growth in Emerging Markets with increasing numbers
of new middle-class consumers. In Fiscal Year 2011,
Emerging Markets delivered 12% sales growth and
generated 16% of the Company’s total sales.
™
The American Customer Satisfaction Index™
Scores By Industry
Food Manufacturing
Baseline
00
01
02
03
04
05
06
07
08
09
10
H.J. Heinz
89
90
89
88
90
88
91
87
90
89
89
Quaker (PepsiCo)
82
86
86
87
86
86
88
85
86
87
87
88
88
Hershey
86
85
86
87
85
87
86
86
87
85
87
Mars
87
82
86
83
83
85
83
86
86
86
87
85
Sara Lee
86
82
81
84
83
84
81
85
82
84
85
85
Nestle
88
84
83
83
83
83
83
84
83
83
85
84
General Mills
83
82
83
83
83
84
82
84
83
84
83
83
ConAgra Foods
83
82
81
83
84
82
86
83
83
84
78
83
Dole Food
90
82
81
82
82
79
81
82
83
83
84
82
Campbell Soup
83
81
81
80
83
79
81
80
83
80
82
82
In Fiscal Year 2011, Heinz ranked first among food
manufacturing companies in customer satisfaction for
the 11th consecutive year. The number-one ranking in the
American Customer Satisfaction Index™ reflects our focus
on quality, innovation and value.
Our November 2010 acquisition of Foodstar, a Chinese
producer of Master® soy sauces and fermented bean
Expanding the Core Portfolio
curd with annual sales of almost $100 million, added a
solid growth platform to our operations in China.
As the trusted leader in nutrition and wellness,
Heinz – the original Pure Food Company –
is dedicated to the sustainable health of people,
the planet and our Company.
Heinz is committed to achieving sustainable growth that benefits our
shareholders, consumers, customers, employees and communities, guided
by the principles of integrity, transparency and social responsibility.
To sustain growth in our Core Portfolio, Heinz is focused
on driving innovation that adds value and convenience for
Heinz accelerated our growth in Latin America by
Mission Statement
86
86
consumers and differentiates our brands from competitors.
acquiring our first major business in Brazil in April
2011. The transaction gave Heinz an 80% stake in the
Our new Ketchup
manufacturer of Quero®, a leading brand of tomato-based
products have included:
Corporate social responsibility is the foundation of the way
Heinz has a comprehensive system of corporate
that we manufacture and market our products and conduct
governance to ensure the Company is transparent and
business throughout the world.
accountable to shareholders and the community and that
it operates in an ethical and socially responsible manner.
sauces, vegetables and ketchup with annual sales of
At the center of our system are a strong and independent
approximately $325 million.
Board of Directors, a Global Code of Conduct, Global
Operating Principles and Supplier Guiding Principles
that set high ethical standards for our employees and
suppliers. The Company reinforces the importance of
these standards through comprehensive, global
training programs.
Around the world, Heinz launched many other new
products in our core categories.
The Heinz Board of Directors enjoyed Heinz® Dip & Squeeze®
Ketchup and Ore-Ida® French Fries at a stop on the Heinz
Ketchup Road Trip™, a mobile tour that promoted the
successful U.S. launch of Dip & Squeeze.
18
Most importantly, Heinz is a global company that values
people, their dignity and their rights. We empower our
diverse workforce to make a sustainable difference on the
job and in their communities.
H.J. Heinz Corporate Social Responsibility Highlights 2011
19