US food giant Kraft has posted a 37% slump in first quarter earnings due to restructuring costs and higher marketing expenses.

Income before tax for the period dropped to $824m from $1.31bn. Sales rose 4.5% to $7.7bn from $7.4bn.

Kraft warned that costs of commodities, notably US cheese and wheat, as well as marketing and pension increases would peg back profit for the year to the lower end of its forecast.

However, Kraft chief executive Jim Dollive said it would stick to its plan to raise marketing spending by $500m-$600m this year.

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