Kellogg Company has reported 2.6% growth in reported net sales for its second quarter, led by its emerging markets businesses.
The company has affirmed its guidance for operating profit and raised its full-year outlook for organic net sales growth to 0-1%.
Reported operating profit was roughly flat year on year and decreased by 14.9% on a currency-neutral adjusted basis, as the company lapped strong growth in the year-ago quarter.
Reported net sales were up 2.6% year-on-year to $3.56 billion, reflecting favourable foreign currency translation. On an organic basis – which excludes the impact of divestiture and currency – the company’s net sales were roughly flat.
During the quarter, Kellogg saw particularly strong momentum in emerging markets. Meanwhile, in developed markets, at-home demand for packaged foods remained elevated, with out-of-home channels seeing continued recovery.
In North America, Kellogg saw a decrease of approximately 7% in reported net sales, following last year’s period of ‘outsized growth’ at the start of the pandemic.
Meanwhile, Kellogg Europe’s reported net sales increased 13% in Q2. Favourable currency translation and organic growth of 3% both contributed, the latter led by snacks in continental Europe and Russia.
On an organic basis, Kellogg Asia Pacific, Middle East and Africa saw the strongest growth in net sales, which were up 23% – driving a 24% reported net sales increase. Growth was broad-based across the region, with Kellogg’s Multipro business in Nigeria recording a strong performance.
In Latin America, Kellogg saw a 19% increase in reported net sales, driven by favourable currency translation and 9% organic growth, which was led by snacks.
Steve Cahillane, Kellogg Company chairman and CEO, said: “On a two-year basis, taking into account the lapping of an unusual 2020, we continued to deliver a balance of strong top-line growth, consumption growth, profitability and cash flow generation.”
He continued: “We delivered these results amidst a challenging business environment that included pervasive shortages of materials, freight and labour, and accompanying cost inflation. By executing our strategy, we remain on track to deliver our full-year guidance even as these conditions persist.”
© FoodBev Media Ltd 2021
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