Kraft Foods Holds 2005 Stockholders Meeting; Company Reviews Sustainable Growth Plan Progress; Reaffirms 2005 Outlook

Business Wire, April 26, 2005

EAST HANOVER, N.J. -- Kraft Foods Inc. (NYSE:KFT), a global leader in branded food and beverages, held its annual stockholders meeting today in East Hanover, NJ. The company reviewed progress against its Sustainable Growth Plan and reaffirmed its previous full-year 2005 earnings guidance for diluted earnings per share from continuing operations of $1.73 to $1.78, up 12-15% from 2004. E[acute accent]"Kraft continues to make good progress," said Louis C. Camilleri, Chairman of the Board of Kraft Foods. "I'm pleased that in the short time since our Sustainable Growth Plan was put in place, we've already begun to see improved sales and market share momentum." E[acute accent]During the meeting, Roger K. Deromedi, Chief Executive Officer, Kraft Foods, presented an overview of this progress, with an emphasis on the company's commitment to corporate responsibility.

E[acute accent]Delivering Sustainable Growth

E[acute accent]"We feel good about what we have accomplished thus far, but there is still more to do," Deromedi told stockholders. Noting that "leveraging our growth platforms will be key for us going forward," he gave an overview of a number of innovation opportunities that have the potential to offer higher growth, including:

E[acute accent]--Whole grain cookies, crackers and cereals, including Honey Maid, Triscuit, Honey Bunches of Oats and Back to Nature;

E[acute accent]--Proprietary milk preparation and fortification technologies, such as those being featured in Tang in key developing markets, like China;

E[acute accent]--A broad range of products that fit into the nutritional requirements of the South Beach Diet; and

E[acute accent]--Tassimo, Kraft's on-demand hot beverage system, which uses technology as a key source of competitive insulation versus private label and other brands that compete mostly on the basis of price.

E[acute accent]Commitment to Act Responsibly

E[acute accent]Deromedi also highlighted several recent examples of actions Kraft has taken in areas such as agricultural sustainability and health and wellness, which are part of the company's strategy to Act Responsibly. "Kraft is seeking to make a meaningful difference on key issues that are relevant to our business," he said. "Meeting our responsibilities as a global corporate citizen is not only the right thing to do - it's right for our business." E[acute accent]For example, through a partnership with the Rainforest Alliance, Kraft is helping move sustainable coffee beyond niche markets into the mainstream. Beans from certified coffee are blended into some of Kraft's best-known coffee brands, such as Gevalia, Maxwell House, Jacobs and Kenco. In 2005, Kraft will purchase 13 million pounds of certified coffee, which will benefit an estimated 100,000 people across coffee growing communities and preserve almost 50,000 acres of rainforest. E[acute accent]In his remarks, Deromedi also discussed a number of significant steps that Kraft has taken since it announced its global Health & Wellness initiative in 2003. For example, the company is in the process of reducing or eliminating trans fats from many of its most popular products, including original Oreo cookies. It is also implementing recently announced changes to the mix of products the company will advertise on TV, radio and in print vehicles seen primarily by children ages 6-11. E[acute accent]More details on these policies, programs and activities can be found at www.kraft.com/responsibility.> E[acute accent]Preliminary Voting Results

E[acute accent]With more than 99% of the vote, the eleven nominees named in the proxy statement were elected directors, the ratification of the selection of PricewaterhouseCoopers LLP as independent auditors was approved, and the company's 2005 Performance Incentive Plan was approved. Finally, a stockholder proposal regarding biotechnology received less than 1% of the vote and was rejected. E[acute accent]Kraft Foods markets many of the world's leading food brands, including Kraft cheese, Maxwell House and Jacobs coffees, Nabisco cookies and crackers, Philadelphia cream cheese, Oscar Mayer meats, Post cereals and Milka chocolates, in more than 150 countries. E[acute accent]For more information and the full text of the business presentation, please visit our website at www.kraft.com.

E[acute accent]Forward-Looking and Cautionary Statements

E[acute accent]This press release contains projections of future results and other forward-looking statements. One can identify these forward-looking statements by use of words such as "strategy," "expects," "plans," "anticipates," "believes," "will," "continues," "estimates," "intends," "projects," "goals," "targets" and other words of similar meaning. One can also identify them by the fact that they do not relate strictly to historical or current facts. These statements are based on the company's assumptions and estimates and are subject to risks and uncertainties. In connection with the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, the company is hereby identifying important factors that could cause actual results and outcomes to differ materially from those contained in any forward-looking statement made by or on behalf of the company; any such statement is qualified by reference to the following cautionary statements. E[acute accent]Each of the company's segments is subject to intense competition, changes in consumer preferences and demand for its products, including low carbohydrate diet trends, the effects of changing prices for its raw materials and local economic and market conditions. Their results are dependent upon their continued ability to promote brand equity successfully, to anticipate and respond to new consumer trends, to develop new products and markets, to broaden brand portfolios, to compete effectively with lower priced products in a consolidating environment at the retail and manufacturing levels and to improve productivity. The company's results are also dependent on its ability to consummate and successfully integrate acquisitions and to realize the cost savings and improved asset utilization contemplated by its restructuring program. The company may, from time to time, divest businesses that are less of a strategic fit within its portfolio, and its results may be impacted by either the gains or losses, or lost operating income, from the sales of those businesses. In addition, the company is subject to the effects of foreign economies, currency movements, fluctuations in levels of customer inventories and credit and other business risks related to its customers operating in a challenging economic and competitive environment. The company's results are affected by its access to credit markets, borrowing costs and credit ratings, which may in turn be influenced by the credit ratings of Altria Group, Inc. The company's benefit expense is subject to the investment performance of pension plan assets, interest rates and cost increases for medical benefits offered to employees and retirees. The company's assessment of the fair value of its operations for purposes of assessing impairment of goodwill and intangibles is based on discounting projections of future cash flows and is affected by the interest rate market and general economic and market conditions. The food industry continues to be subject to recalls if products become adulterated or misbranded, liability if product consumption causes injury, ingredient disclosure and labeling laws and regulations and the possibility that consumers could lose confidence in the safety and quality of certain food products. The food industry is also subject to consumer concerns regarding genetically modified organisms and the health implications of obesity and trans-fatty acids. Developments in any of these areas could cause the company's results to differ materially from results that have been or may be projected by or on behalf of the company. The company cautions that the foregoing list of important factors is not exclusive. Any forward-looking statements in this press release are made as of the date hereof. The company does not undertake to update any forward-looking statement.