New York (Dow Jones)-H.J. Heinz Co. on Thursday said fis- cal first quarter net income rose 23%,
Question:
New York (Dow Jones)-H.J. Heinz Co. on Thursday said fis- cal first quarter net income rose 23%, helped by strong sales of Weight Watchers Smart One meals and Classico pasta sauces. Heinz (HNZ), which is awaiting the results of a proxy fight with the Trian Group hedge fund, said profit increased to \($194.1\) million, or 58 cents a share, from \($157.3\) million, or 45 cents, a year ago. Excluding charges in the year-ago quarter, income would have grown 18.6%. Sales for the three months ended Aug. 2 increased 8.4% to \($2.06\) billion from \($1.9\) billion, helped by higher selling prices and foreign currency exchange. Volume advanced 5.1%, driven by higher consumption and new products.... Shares in Heinz fell as much as 19 cents to \($41.79\) in early trading. "Heinz's impressive first-quarter performance demonstrates that the company is delivering results with a clear focus on growing its key brands and enhancing shareholder value," said spokesman Michael Mullen in an e-mail....
Required:
Why might investors have been skeptical about the source and sustainability of the quarterly earnings increase reported by Heinz?
Step by Step Answer: