Cereal manufacturer Kellogg has reported third quarter net income of US$203.5m, or 49 cents a share, compared with $150.3m, or 37 cents a share, for the third quarter of last year.

The 35% increase in earnings is in part due to costs incurred in last year's third quarter, such as goodwill expense and the cost of integrating cookie maker Keebler. Last year's third-quarter earnings excluding special items were 48 cents a share

Kellogg has also been focusing on its higher-margin products such as Special K Red Berries cereal and its Disney line of promotional products.

The company's cereal prices were up 4% in the period compared to an industry category rise of 2%.

Third quarter net sales fell to $2.14bn from $2.19bn a year earlier, but comparable sales growth was up 7%.

Kellogg's full-year earnings forecast remains at $1.73 a share.