Kellogg Says Struggling US Market is on the Up-and-Up
12 Feb 2016 --- Kellogg has reported a $41m loss and a sales dip of over 10 per cent but said its struggling US cereal business is improving. Kellogg, whose brands include Special K and Rice Krispies, reported net sales of $3.1bn in the fourth quarter ending January 2, down 10.6 per cent on the year.
The loss of $41m was a significant improvement on the $293m loss it posted a year earlier.
The cereal giant is undertaking a cost-cutting initiative, which it says is helping it reduce its losses, and also trying to revive sales of key brands such as Special K.
Its core US business has suffered years of decline but the company said it was now improving.
John Bryant, chief executive and chairman of Kellogg, said: “Our results in 2015 met or exceeded our initial expectations. We saw good growth in many of our businesses, and importantly, trends continue to improve in the US Cereal business. We are committed to achieving our long-term goals for growth in 2016, supported up our increasing momentum and unprecedented productivity programs.”
Kellogg, like its rivals, is trying to meet consumer trends towards healthier snacks and cereals by adding ingredients which consumers see as healthier.
Kellogg’s biggest division, US morning foods, reported sales growth of 1.5 per cent. Overall, in its core North America market, net sales were down 8 per cent in the quarter.
But Kellogg said it had seen improving trends, in snacks and morning cereals, in the period.
In Europe, net sales were up 1.6 per cent in the quarter, helped by growth in its snacks business, including its crisp brand Pringles.
Net sales were up 3.3 per cent across Asia Pacific and 45.3 per cent in Latin America.
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