Why Kellogg’s shares are trading higher today

  • Kellogg Company K reported first-quarter FY22 sales growth of 2.4% year-over-year to $3.67 billion, beating consensus of $3.59 billion.
  • Adjusted EPS of $1.10 topped analyst consensus of $0.93.
  • Kellogg’s sales in North America decreased 1%, Europe increased 2%, Latin America increased 8%, Asia-Pacific, Middle East and of Africa jumped 12%.
  • Selling, general and administrative expenses decreased 7.5% year-on-year to $642 million.
  • Operating margin was 14% and operating profit for the quarter increased 9.5% to $517 million.
  • Reported gross margin was 31.6%, while adjusted gross margin contracted 280 basis points to 30.4%.
  • Kellogg held $313 million in cash and cash equivalents as of April 2, 2022 and generated operating cash flow of $327 million year-to-date.
  • “The strength of our portfolio is evident as we have more than offset the sales and cost impact of the resumption of North American grain supply with continued snack growth momentum around the world,” said President and CEO Steve Cahillane.
  • Outlook: Kellogg raised its forecast for organic net sales growth for FY22 to around 4% from 3%.
  • Kellogg reaffirmed its forecast for adjusted EPS growth for FY22 of 1% to 2% on a currency-neutral basis.
  • Price action: K shares traded up 2.42% at $69.49 pre-market when last checked on Thursday.
  • Photo Via Wikimedia Commons
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