US food giant Kellogg has lowered its full-year sales outlook on the back of weaker growth in the US and the stronger dollar.
The Special K producer today (1 August) reaffirmed its guidance for full-year earnings per share of $3.84 to $3.93, but said sales growth is now expected to be around 5%, down from a prior outlook of 7%. Kellogg cited slower-than-expected growth in developed markets, particularly the US, and the impact of the weaker US dollar on the downgrade.
Kellogg’s share price was down 1.49% to $65.26 at 11:18 ET on the news.
The company also saw its earnings fall in the six months ended 29 June, by 1.2% to US$663m. During the period, Kellogg incurred higher taxes and an increase in expenses.
Operating profit was up 2.6% to $1.07bn. The growth was achieved despite the continued effect of higher net inflation, Kellogg said. Internal operating profit, excluding the impact of foreign currency and acquisitions, was down 1.9%.
Sales, however, climbed 9.5% in the period to reach $7.57bn.
Earnings trends turned positive in the second quarter, however, with profit climbing 7% to $352m and sales increasing 6.9% to $3.7bn.
Click here for coverage of Kellogg’s plans to boost US cereals sales.
For Kellogg’s plans for Europe, click here.
Click here to view the full earnings release.
