(Bloomberg) -- Kellogg Co. rose in early trading after the company's sales exceeded expectations, driven by the popularity of frozen foods and snacks like Pringles potato chips and Pop-Tarts. That offset more declines for cereal.
- The packaged-food giant reported second-quarter revenue that rose 3% from a year earlier to $3.46 billion, above analysts' average estimate. The company reaffirmed its guidance for sales to grow in a range of 1% to 2% for the full year.
Key Insights
Kellogg's shares have lagged behind the broad rally in U.S. equity markets, so this report alleviates some of the pressure on the Battle Creek, Michigan-based company. Chief Executive Officer Steve Cahillane said Kellogg has “increased confidence that we will finish the year on our guidance.”
With cereal slumping, Kellogg has looked to salty snacks such as Pringles and Cheez-Its to boost revenue. Snack sales in North America rose 4% in the quarter, while cereal sales declined 5% -- part of a shift by consumers away from the long-time breakfast staple.
Market Reaction
- Kellogg shares rose as much as 5.1% to $61.20 in early trading. The stock has gained 2.1% this year through Wednesday's close.
--With assistance from Craig Giammona and Cécile Daurat.
To contact the reporter on this story: Deena Shanker in New York at dshanker@bloomberg.net
To contact the editors responsible for this story: Anne Riley Moffat at ariley17@bloomberg.net, Jonathan Roeder
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