Heinz sees quarterly profit above Wall Street view

NEW YORK (Reuters) - H.J. Heinz Co. (HNZ.N) forecast higher-than-expected quarterly earnings on Wednesday, helped by new products, increased marketing and the weak dollar, sending shares up more than 3 percent.

Heinz, which makes Ore-Ida potatoes and Smart Ones frozen meals in addition to its namesake ketchup, said it expects to earn 62 cents or 63 cents per share in its fiscal first quarter. That would top analysts' average estimate of 55 cents, according to Reuters Estimates.

After overhauling its U.S. and European portfolios over the past few years, Heinz has ramped up spending on marketing and new-product development, leading to new successes such as the Big Eat meals in Britain and Smart Ones Anytime Selections in the United States.

When the company releases first-quarter results on August 24, it expects to report that operating income rose 14 percent on sales gains and productivity improvements. Heinz also said the weak dollar boosted earnings and offset higher commodities costs.

Speaking at the company's annual shareholders' meeting, which was also broadcast over the Internet, Heinz Chief Executive William Johnson said higher prices for corn-based sweeteners, potatoes, tomatoes, meat and packaging increased costs $180 million last year.

Johnson said he expected the "commodities headwinds" to accelerate this year as oil prices and demand for ethanol continue to rise. Besides making corn more expensive, Johnson said soaring demand for ethanol, a corn-based gasoline alternative, is displacing other crops, which leads to higher prices for grains and livestock.

Nonetheless Johnson sounded optimistic as he forecast first-quarter sales growth of 9 percent, aided by double-digit organic sales growth of the company's ketchup, beans and soup brands.

Heinz also said it expects full-year profit to be near the top of its forecast range of $2.54 to $2.60 per share.

Analysts had been expecting $2.59 per share, excluding items.

Johnson also restated the company's plan to boost its spending on marketing by $40 million this year, on top of a $60 million increase last year.

Heinz shares, which had fallen nearly 9 percent in the last month through Tuesday's close, were up $1.37 at $43.94 on the New York Stock Exchange. A year ago they closed at $40.97.

(Reporting by Martinne Geller; additional reporting by Anupreeta Das)