Kellogg's sales decline, but profit tops forecasts

AP News
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Posted: May 05, 2016 8:49 AM
Kellogg's sales decline, but profit tops forecasts

BATTLE CREEK, Mich. (AP) — Kellogg's sales and profit declined in the first quarter as the maker of Frosted Flakes, Pop Tarts and Eggos worked to revive its cereal business and was hit by unfavorable currency translations.

The Battle Creek, Michigan company said sales declined 1.2 percent for its flagship U.S. Morning Foods segment, which includes cereals. Kellogg and rival General Mills have been trying to invigorate cereal sales as Americans have increasingly reached for alternatives at breakfast.

To offset its sales challenges, Kellogg and other major packaged food makers have been slashing costs.

Kellogg is also trying to diversify its business. The company gets about 70 percent of its sales from North America, but is hoping products such as Pringle give it greater reach into markets overseas.

For the quarter ended April 2, Kellogg earned $175 million, or 49 cents per share. Earnings, adjusted for non-recurring costs, were 97 cents per share.

That topped the 94 cents per share analysts expected, according to Zacks Investment Research.

Total revenue was $3.4 billion in the period, which fell short of the $3.49 Wall Street had forecast.

Kellogg shares have climbed roughly 7 percent since the beginning of the year, while the Standard & Poor's 500 index has stayed nearly flat. The stock has climbed 20 percent in the last 12 months.

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Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on K at http://www.zacks.com/ap/K

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Keywords: Kellogg, Earnings Report