Kraft Foods Highlights Positive Momentum of Sustainable Growth Plan During 2006 Stockholders Meeting and Reaffirms Guidance

In his remarks, Roger K. Deromedi, Chief Executive Officer, KraftFoods, reported that the company's focus on the right business driverssince 2004 had delivered measurable progress, including acceleratednew product revenues, improved product mix, solid growth in developingmarkets, increased portfolio focus, significant cost savings, betterBrand Value propositions, and improved U.S. market shares.

"Our Sustainable Growth Plan is fixing our business, enabling usto take better advantage of both our scale and one of the best brandportfolios in the food and beverage industry," Deromedi said. "Whileour financial performance lagged our improving business fundamentalslast year, 2006 is off to a good start. I'm confident that strongexecution of our Guiding Principles will continue to deliver improvedfinancial performance in 2006 and beyond."

With more than 99% of the vote, the nine nominees named in theproxy statement were elected directors, the ratification of theselection of PricewaterhouseCoopers LLP as independent auditors wasapproved, and the company's 2006 Stock Compensation Plan forNon-Employee Directors was also approved. Additionally, a stockholderproposal regarding Kraft's support of the 2006 Gay Games received lessthan 1% of the vote and was rejected.

2006 Outlook

EPS guidance for 2006 remains unchanged from April 19, 2006 at$1.55 to $1.60 per diluted share, including $0.24 per diluted sharefor the IRS Tax Audit resolution and $(0.07) per diluted share for thepet snacks divestiture. Guidance also includes $0.50 per diluted shareof charges attributable to the Company's restructuring program andother impairment charges.

Kraft Foods (NYSE: KFT) is the world's second-largest food andbeverage company. For more than 100 years, we've been dedicated tohelping people around the world eat and live better. Hundreds ofmillions of times a day, in more than 150 countries, consumers reachfor their favorite Kraft brands including Kraft cheeses and dinners,Jacobs, Gevalia and Maxwell House coffees, Oscar Mayer meats, DiGiornopizzas, Oreo cookies, Ritz and Wheat Thins crackers and chips,Philadelphia cream cheese, Milka and Cote d'Or chocolates, HoneyBunches of Oats cereals, Good Seasons salad dressings and Tangrefreshment beverages. They've also started adding our Tassimo hotbeverage system, South Beach Diet line and a growing range ofbetter-for-you Sensible Solution products to their shopping baskets,continually expanding their list of Kraft favorites.

For more information on Kraft Foods, please visit our website atwww.kraft.com.

Forward-Looking and Cautionary Statements

This press release contains projections of future results andother forward-looking statements. One can identify theseforward-looking statements by use of words such as "strategy,""expects," "plans," "anticipates," "believes," "will," "continues,""estimates," "intends," "projects," "goals," "targets" and other wordsof similar meaning. One can also identify them by the fact that theydo not relate strictly to historical or current facts. Thesestatements are based on the Company's current assumptions andestimates and are subject to risks and uncertainties. In connectionwith the "safe harbor" provisions of the Private Securities LitigationReform Act of 1995, the Company is hereby identifying importantfactors that could cause actual results and outcomes to differmaterially from those contained in any forward looking statement madeby or on behalf of the Company. These factors include: (a) the effecton the Company of competition in its markets, changes in consumerpreferences and demand for its products, including diet trends,changing prices for its raw materials and local economic and marketconditions; (b) the Company's continued ability to promote brandequity successfully, to anticipate and respond to new consumer trends,to develop new products and markets, to broaden brand portfolios, tocompete effectively with lower priced products in a consolidatingenvironment at the retail and manufacturing levels and to improveproductivity; (c) the Company's ability to consummate and successfullyintegrate acquisitions and to realize the cost savings and improvedasset utilization contemplated by its restructuring program; (d) theimpact of gains or losses, or lost operating income, from the sales ofbusinesses that are less of a strategic fit within the Company'sportfolio; (e) the effects of foreign economies, changes in taxrequirements and currency movements; (f) fluctuations in levels ofcustomer inventories and credit and other business risks related tothe operations of the Company's customers; (g) the Company's access tocredit markets, borrowing costs and credit ratings, which may in turnbe influenced by the credit ratings of Altria Group, Inc.; (h) theCompany's benefit expense, which is subject to the investmentperformance of pension plan assets, interest rates and cost increasesfor medical benefits offered to employees and retirees; (i) the impactof recalls if products become adulterated or misbranded, liability ifproduct consumption causes injury, ingredient disclosure and labelinglaws and regulations, potential claims relating to false or deceptiveadvertising under consumer protection or other laws and thepossibility that consumers could lose confidence in the safety andquality of certain food products; (j) consumer concerns regardinggenetically modified organisms and the health implications of obesityand trans fatty acids; and (k) potential short-term volatility in thetrading volume and market price of the Company's stock as a result ofa spin-off of the Company from Altria Group, Inc. Developments in anyof these areas could cause the Company's results to differ materiallyfrom results that have been or may be projected by or on behalf of theCompany. The Company cautions that the foregoing list of importantfactors is not exclusive. For additional information on these andother factors that could affect the Company's forward-lookingstatements, see the Company's filings with the Securities and ExchangeCommission, including the Company's most recently filed Annual Reporton Form 10-K and subsequent reports on Form 10-Q and 8-K. Any forwardlooking statements in this press release are made as of the datehereof. The Company does not undertake to update any forward lookingstatement.