WK Kellogg Co, the recently spun-off North American cereal business of Kellanova, raised its full-year profit forecast, encouraged by resilient demand for its Froot Loops and Corn Flakes despite higher prices.
The packaged food maker, like other US peers such as Kraft Heinz, Campbell Soup and Mondelēz, has been increasing prices over the past few years to strengthen margins amid an inflation-induced slowdown in consumer spending.
The Apple Jacks maker forecasts 2024 adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) to be between $265 million and $270 million (€246.45 million - €251.1 million), up from its prior expectation of $255 million - $265 million (€237.15 million - €246.45 million).
'Greater Strategic Focus'
Gary Pilnick, chair and chief executive officer of WK Kellogg Co stated, “Our team is executing, driving results, and building momentum to unlock our unique value proposition.”
“As an independent company, we are already experiencing the benefits of greater strategic focus and operational flexibility as we aim our organisation, capital, and resources towards delivering on our strategic objectives."
WK Kellogg has forecast adjusted net sales growth between -1% - 1% for full-year 2024, while adjusted EBITDA growth is projected to range between 3.0% to 5.0%
In October 2023, Kellogg Company completed the spin-off of its North American cereal business into a new standalone entity called WK Kellogg and renamed itself Kellanova, aiming to sharpen focus on each division.
Kellanova
The company's upbeat sales report mirrors comments from Kellanova, which posted better-than-expected quarterly sales last week and maintained its 2024 outlook as demand for its products held steady.
The company reported sales of $651 million (€605.43 million) for the quarter ended 30 December, above analysts' average estimate of $645.9 million (€600.87 million), according to LSEG data.
News by Reuters, additional reporting by ESM.
