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Kellogg cuts full-year sales forecast as cereal sales fall

July 31 (Reuters) - Kellogg Co, the world's largest maker of breakfast cereal, reported its fifth straight decline in quarterly U.S. cereal sales and said it no longer expects full-year internal sales to rise.

Internal sales, which excludes foreign currency translation, acquisitions, dispositions, and integration costs, fell 1.5 percent in the second quarter ended June 28, Kellogg said.

The company cut its adjusted earnings forecast for the year ending December to between $3.81 and $3.89 per share from between $3.89 and $3.97.

Kellogg said it now expects full-year internal net sales to decrease 1-2 percent compared with its previous forecast of an increase of 1 percent.

Sales at Kellogg's U.S. cereal business, which includes Corn Flakes, Froot Loops and Special K, fell 4.9 percent in the quarter, hurt by the rising popularity of other breakfast items such as yogurt and frozen egg sandwiches.

The Battle Creek, Michigan-based company's net sales in North America, its biggest market, fell 3.7 percent to $2.35 billion from a year earlier.

Total net sales fell 0.8 percent to $3.69 billion, missing the average analyst estimate of $3.71 billion, according to Thomson Reuters I/B/E/S.