New products help Kellogg achieve sustainable growth
third quarter with the North America region also putting up a
strong performance thanks to the successful introdution of new
product lines.
Net earnings for the quarter were therefore up to $247.0 million from $231.3 million in the same period of last year, while diluted earnings per share were $0.59, an increase of 5 percent on last year's $0.56 per share.
"We are very pleased with our strong results in the third quarter and especially pleased that we could generate strong sales and earnings growth while continuing to make significant investments in our business," said Carlos Gutierrez, Kellogg's CEO.
As far as North America in particular is concerned, the region's net sales growth was approximately 5 percent for the quarter, building on the 3 percent growth of the comparable period last year.
The North America Retail Snacks business in particular had another good quarter, posting internal sales growth of 9 percent, and Kellogg noted that cookies, crackers, wholesome snacks, and toaster pastries all reported increased sales despite some weak category trends.
"The wholesome snacks business again benefited from the introduction of various varieties of fruit snacks, and Pop-Tarts achieved an 84 per cent share of the toaster pastries category in measured channels," said the company.
"Each of our North American cereal, snacks, frozen and specialty channels posted excellent results," said Gutierrez.
Operating profit in the third quarter increased by approximately 6 percent to $457 million.
Gutierrez said the company's goal is "sustainable, long-term growth".
He added: "We have continued significant investment in brand building and innovation throughout this year and have continued to absorb the costs associated with cost-reduction initiatives. It is gratifying that we can make this investment in the future and still report such strong results."
In line with these positive results, Kellogg raised its guidance for full-year 2004 earnings per share to $2.11-2.13, from its previous range of $2.07-2.11.
