Kraft Foods Group Inc. (NASDAQ:KRFT)

The net profit margin exhibited significant fluctuation between 2012 and 2014. Initial values indicate a substantial increase followed by a considerable decline.

Net Profit Margin Trend

In 2012, the net profit margin stood at 8.95%. This figure rose markedly to 14.90% in 2013, representing a 66.8% increase. However, a substantial decrease was observed in 2014, with the net profit margin falling to 5.73%, a decline of approximately 61.8% from the prior year.

The observed changes in net profit margin do not appear directly correlated with revenue trends. Net revenues remained relatively stable across the three years, fluctuating within a narrow range between US$18.205 billion and US$18.339 billion. This suggests that changes in profitability were primarily driven by fluctuations in net earnings rather than sales volume.

Earnings Impact

Net earnings increased from US$1,642 million in 2012 to US$2,715 million in 2013, contributing to the improved net profit margin. Conversely, net earnings decreased significantly to US$1,043 million in 2014, resulting in the substantial reduction in net profit margin despite consistent revenue levels.

The volatility in net profit margin warrants further investigation to determine the underlying factors influencing net earnings. Potential areas of inquiry include cost of goods sold, operating expenses, and non-operating items.