Kellogg’s cereal sales fall over weak demand

Kellogg’s posted disappointing first-quarter sales on Thursday, hurt by a weak performance in its US morning-foods division.

The world’s largest cereal-maker has worked to turn around its struggling morning-foods unit, which was hit by a broad drop in US cereal sales.

Kellogg’s has argued the category can return to growth this year as younger consumers embrace the breakfast staple as a snack. Still, sales have remained sluggish this year.

"We would have liked it to be a little better, but it wasn't far away from what we expected to see," chief executive John Bryant said. "We expect the cereal business to build momentum throughout the year."

To offset falling sales, Kellogg’s has been cutting costs. Profit in the first quarter was 97 US cents a share, excluding some items, the company said. Analysts had projected 94 cents, on average.

Sales slid 4.5 per cent to $3.4 billion in the period, trailing analysts’ average estimate of $3.46 billion.

– (Bloomberg)