BATTLE CREEK, Mich. - August 3, 2017 - Kellogg Company (NYSE: K) today announced second quarter 2017 results and reaffirmed its financial outlook for the full year 2017.
"Our second quarter results keep us on track to deliver on our full-year financial targets, with sequential improvement in net sales performance and continued profit-margin expansion," said John Bryant, Kellogg Company’s chairman and chief executive officer. “More importantly, we continued to make progress toward the transformation of our Company. For instance, during the quarter we made strong progress on our transition out of Direct Store Delivery (DSD) in U.S. Snacks, an enormously complex initiative that the team has executed exceptionally well. We remain committed to returning to top-line growth, as outlined in our 2020 Growth Plan."
Second Quarter Consolidated Results:
• Kellogg’s second quarter 2017 GAAP (or "reported") earnings per share increased by 1% from the prior-year quarter, as higher operating profit and a lower effective tax rate more than offset a higher level of restructuring charges. Non-GAAP, comparable earnings per share were up almost 7% from the year-earlier quarter, and non-GAAP, currency-neutral comparable earnings per share increased by about 8% year-on-year.
• Quarterly reported operating profit increased about 1%, and operating profit margin improved, as productivity savings more than offset the impact of higher restructuring charges related to the Project K restructuring program, which includes this year's exit from its U.S. Snacks segment's Direct Store Delivery sales and delivery system. Currency-neutral comparable operating profit increased by nearly 7% because of efficiencies in Cost of Goods Sold and Selling General and Administrative expenses related to Zero-Based Budgeting and Project K, driving more than a full percentage point of currency-neutral comparable operating profit-margin expansion.
• Second-quarter 2017 reported and currency-neutral comparable net sales decreased, due principally to soft consumption trends in the U.S. and reduced merchandising activity in Europe related to pricing actions
