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July 31, 2008

US: Kellogg ups earnings guidance after strong H1

Kellogg, the cereal giant, today (31 July) raised its full-year earnings per share guidance after seeing half-year profits and sales rise.

Kellogg, the cereal giant, today (31 July) raised its full-year earnings per share guidance after seeing half-year profits and sales rise.

The company booked a 5.7% rise in operating income to US$1.02bn for the first six months of the year, despite higher commodity costs and increased advertising spending.

Net sales rose 10.4% to $6.6bn; second-quarter net sales were up 11% to $3.3bn.

The results led Kellogg to up its earnings per share guidance for 2008 to $2.95-3.00.

“Our first-half performance provides further evidence of the strength of our business model and strategy,” said CEO David Mackay.

Kellogg saw operating profit from its North American operations rise 7.8% on the back of a 7.4% increase in sales. The company attributed the performance to “broad-based growth” across the business.

In Europe, operating profit dipped 0.4% despite an 18.9% jump in sales.

In Latin America, operating profit rose 2.9% with sales up 11%. Earnings from Kellogg’s Asia Pacific unit, which includes Australia, Asia and South Africa, jumped 12.8%. Sales in the region rose 15.8%.

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