U.S. Markets closed

Post Earnings Coverage as Kellogg's EPS Surged 51%

Upcoming AWS Coverage on Ingredion Post-Earnings Results

LONDON, UK / ACCESSWIRE / May 18, 2017 / Active Wall St. announces its post-earnings coverage on Kellogg Co. (NYSE: K). The Company posted its first quarter fiscal 2017 financial results on May 04, 2017. Cornflakes maker surpassed earnings expectations. Register with us now for your free membership at:


One of Kellogg's competitors within the Processed & Packaged Goods space, Ingredion Inc. (NYSE: INGR), reported on May 03, 2017, its results for Q1 2017. AWS will be initiating a research report on Ingredion in the coming days.

Today, AWS is promoting its earnings coverage on K; touching on INGR. Get our free coverage by signing up to


Earnings Reviewed

Kellogg's revenue for the first quarter ended April 01, 2017 totaled $3.26 billion, down compared to revenue of $3.40 billion in Q1 2017, and below analysts' consensus estimates of $3.28 billion.

Kellogg reported Q1 2017 net income of $262.0 million, or $0.74 per share, up from $175.0 million, $0.49 per share, for Q1 2016. The Company's reported quarter GAAP earnings per share increased by 51% on a y-o-y basis, due to year-ago interest costs related to a bond tender and a lower tax rate, partially offset by higher up-front costs related to the Project K restructuring program and adverse currency translation. On an adjusted basis, Kellogg reported EPS of $1.06, beating Wall Street's estimates of $0.99 per share. Non-GAAP, comparable earnings per share, were up more than 10% on a y-o-y basis because of productivity savings and a planned discrete tax benefit, which more than offset the negative impact of currency translation.

Segment Results

During Q1 2017, Kellogg's North America sales fell 4% on a y-o-y basis to $2.29 billion, attributed to an industry-wide softening of consumption trends. The Company also experienced trade-inventory reductions from the previous quarter. The regions volumes decreased 4.9% on a y-o-y basis while price/mix was up 0.5%. North America's operating profit declined to $261 million for the reported quarter compared to $362 million in the prior year's same quarter.

For Q1 2017, Kellogg's sales in Europe fell 14% to $512 million. Currency headwinds impacted sales numbers by 6.5%. In addition to a persistently challenging environment in the UK, Europe's results in the reported quarter were further affected by customer negotiations related to pricing actions. Operating profit declined on a reported basis to $66 million compared to $70 million in Q1 2016, due to sales decline and adverse currency translation, but reported and currency-neutral comparable-basis profit margins continued to increase.

Kellogg's Latin America revenue surged 15% to $222 million. Latin America, reported net sales increased due to the December 2016 acquisition of Parati in Brazil, while currency-neutral comparable net sales were down slightly, as trade-inventory reductions related to distributor transitions offset cereal growth in Mexico and Pringles growth led by Mexico and expansion in Argentina and Chile. Comparable operating profit increased to $33 million in the reported quarter versus $23 million in the year earlier comparable quarter.

During Q1 2017, Kellogg's Asia/Pacific region posted revenues of $232 million, up 7.3% y-o-y, led by strong growth across Asia, and growth across the Region for Pringles. The Company's business in Australia continued to show improvement, increasing its cereal consumption and share. Asia/Pacific increased its operating profit to $22 million compared to $17 million in the prior year's same quarter.


For FY17, Kellogg expects revenues to decline approximately 3% on a currency-neutral comparable basis. The Company expects adjusted constant currency earnings in the range of $4.03–$4.09 per share. Adjusting for currency impact, Kellogg's is forecasting adjusted EPS in the band of $3.91 and $3.97. The Company also affirmed its guidance for 2017 cash flow. Specifically, it forecasts cash from operating activities should be approximately $1.6 billion -1.7 billion, which after capital expenditure translates into cash flow of $1.1 billion-1.2 billion.

Stock Performance

At the close of trading session on Wednesday, May 17, 2017, Kellogg's stock price slightly rose by 0.26% to end the day at $70.53. A total volume of 2.52 million shares were exchanged during the session, which was above the 3-month average volume of 2.41 million shares. The Company's shares are trading at a PE ratio of 31.99 and have a dividend yield of 2.95%. The stock currently has a market cap of $24.66 billion.

Active Wall Street:

Active Wall Street (AWS) produces regular sponsored and non-sponsored reports, articles, stock market blogs, and popular investment newsletters covering equities listed on NYSE and NASDAQ and micro-cap stocks. AWS has two distinct and independent departments. One department produces non-sponsored analyst certified content generally in the form of press releases, articles and reports covering equities listed on NYSE and NASDAQ and the other produces sponsored content (in most cases not reviewed by a registered analyst), which typically consists of compensated investment newsletters, articles and reports covering listed stocks and micro-caps. Such sponsored content is outside the scope of procedures detailed below.

AWS has not been compensated; directly or indirectly; for producing or publishing this document.


The non-sponsored content contained herein has been prepared by a writer (the "Author") and is fact checked and reviewed by a third party research service company (the "Reviewer") represented by a credentialed financial analyst, for further information on analyst credentials, please email info@activewallst.com. Rohit Tuli, a CFA® charterholder (the "Sponsor"), provides necessary guidance in preparing the document templates. The Reviewer has reviewed and revised the content, as necessary, based on publicly available information which is believed to be reliable. Content is researched, written and reviewed on a reasonable-effort basis. The Reviewer has not performed any independent investigations or forensic audits to validate the information herein. The Reviewer has only independently reviewed the information provided by the Author according to the procedures outlined by AWS. AWS is not entitled to veto or interfere in the application of such procedures by the third-party research service company to the articles, documents or reports, as the case may be. Unless otherwise noted, any content outside of this document has no association with the Author or the Reviewer in any way.


AWS, the Author, and the Reviewer are not responsible for any error which may be occasioned at the time of printing of this document or any error, mistake or shortcoming. No liability is accepted whatsoever for any direct, indirect or consequential loss arising from the use of this document. AWS, the Author, and the Reviewer expressly disclaim any fiduciary responsibility or liability for any consequences, financial or otherwise arising from any reliance placed on the information in this document. Additionally, AWS, the Author, and the Reviewer do not (1) guarantee the accuracy, timeliness, completeness or correct sequencing of the information, or (2) warrant any results from use of the information. The included information is subject to change without notice.


This document is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed, and is to be used for informational purposes only. Please read all associated disclosures and disclaimers in full before investing. Neither AWS nor any party affiliated with us is a registered investment adviser or broker-dealer with any agency or in any jurisdiction whatsoever. To download our report(s), read our disclosures, or for more information, visit http://www.activewallst.com/disclaimer/.


For any questions, inquiries, or comments reach out to us directly. If you're a company we are covering and wish to no longer feature on our coverage list contact us via email and/or phone between 09:30 EDT to 16:00 EDT from Monday to Friday at:

Email: info@activewallst.com

Phone number: 1-858-257-3144

Office Address: 3rd floor, 207 Regent Street, London, W1B 3HH, United Kingdom

CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.

SOURCE: Active Wall Street