Kellogg insists its North American cereal business is seeing improvement

Kellogg insists its North American cereal business is seeing improvement

Continued pressure in the North American cereal category has contributed to another sales and profit decline for Kellogg.

Reported net income for the nine months to 3 October fell 29.2% to US$655m. On a comparable basis - which excludes factors like restructuring costs and one-off items - they were down 9% to $978m.

Operating profit on a reported basis fell 21.9% to $1.1bn. On a comparable basis fell 9.5% to $1.5bn.

Sales fell 6.4% and 6.2% respectively on a comparable and reported basis to $10.4bn.

The firm insisted it was seeing "improving trends" in the US cereal business. In the third quarter, Kellogg's US Morning Foods arm posted a currency-neutral comparable net sales decline of 2.6%. Its US frozen foods, Kashi and Canadian businesses posted a 3.4% decrease in currency-neutral comparable net sales.

Internationally for the quarter, Kellogg posted sales declines in Europe, Latin America and Asia Pacific.

Overall for the third quarter, sales on a reported and comparable basis were 8.5% down to $3.3bn, significantly impacted by foreign currency.

Kellogg reported an 8.4% drop in reported net profit to $205m and on a comparable basis, an 11.3% drop to $301m.

Operating profit on a reported basis fell 8.7% to $334m and fell 12.3 to $465m on a comparable basis.

Kellogg did however beat analyst estimates for earnings per share. Wall Street analysts predicted earnings of 83 cents per share. Kellogg reported EPS of 85 cents per share.