BATTLE CREEK, Mich., May 2, 2013 (GLOBE NEWSWIRE) -- Kellogg Company (NYSE:K) today announced solid results that were in-line with the company's expectations. First quarter 2013 reported net sales increased by 12.2 percent to $3.9 billion. Internal net sales*, which exclude the effects of foreign currency translation, acquisitions, dispositions, and integration costs, rose by 2.2 percent over the same period. First quarter 2013 operating profit was $503 million, a reported decrease of 4.5 percent; underlying internal operating profit*, which excludes the effects of foreign currency translation, acquisitions, dispositions, mark-to-market accounting, and integration costs, decreased by 5.8 percent. As expected, the decline in underlying internal operating profit* was largely due to the recognition of considerable cost-of-goods-sold inflation in the quarter. Results in the first quarter included a majority of the inflation, net of cost savings, that the company expects to recognize for the full year.
Reported earnings for the first quarter 2013 were $311 million, or $0.85 per diluted share, a decline of 13 percent from the $0.98 per diluted share reported in the first quarter of last year. Comparable first quarter 2013 earnings*, which exclude the impact of mark-to-market accounting and integration costs associated with the acquisition of Pringles, were $0.99 per share, in-line with the company's expectations. This result included a negative impact of $0.03 per share from the Venezuelan devaluation.
"Results in the first quarter were broadly as we expected, and we're pleased to have a solid start to the year," said John Bryant, Kellogg Company's president and chief executive officer. "We saw good comparable revenue growth in many regions around the world and the Pringles business continued to post strong results. As a result, we're also pleased to report that we're on-track to meet our guidance for the full-year."
* Internal sales growth, underlying internal operating profit growth, underlying internal operating profit, and comparable earnings are all non-GAAP financial measures. See the tables herein for important information regarding these measures and a full reconciliation to the most comparable GAAP measure.
North America
Kellogg North America net sales were $2.6 billion in the first quarter, a reported increase of 8.1 percent; internal net sales increased by 1.7 percent. The U.S. Morning Foods segment posted internal net sales growth of 1.6 percent. Internal net sales in the U.S. Snacks segment declined by 1.7 percent. The U.S. Specialty Channels segment posted 3.4 percent internal net sales growth in the quarter and the North America Other segment, which is comprised of the U.S. Frozen Foods and Canadian businesses, achieved 7.4 percent internal sales growth. Reported operating profit in North America increased by 1.2 percent; internal operating profit declined by 3.5 percent, largely as the result of the cost-of-goods-sold inflation.
International
Reported net sales increased by 28.7 percent in Europe in the quarter; internal net sales increased by 2.6 percent, primarily as the result of good growth in the United Kingdom. In Latin America, reported net sales increased by 13.7 percent and internal net sales increased by 7.4 percent. Reported net sales in Asia Pacific increased by 14.7 percent and internal net sales increased by 0.3 percent, although consumption increased at a faster rate.
Interest and Tax
Kellogg's interest expense was $60 million in the first quarter. The company recognized a one-time, pre-tax benefit of $26 million in the first quarter of 2012 as the result of hedging activities associated with the acquisition of the Pringles business; this accounted for a majority of the year-over-year increase in interest expense. The reported effective tax rate in the first quarter of 2013 was 28.4 percent.
Cash flow
Cash flow, a non-GAAP measure, defined as cash from operating activities less capital expenditures, was $236 million for the quarter. This was lower than the $277 million posted in the first quarter of 2012; the decline was the result of differences in the timing of capital expenditures. Cash flow for the year is still anticipated to be in a range between $1.1 and $1.2 billion.
Kellogg repurchased $44 million of shares during the first quarter, less than option proceeds of $259 million.
Full-Year 2013 Guidance
The company reaffirmed its guidance for full-year reported net sales growth of approximately seven percent. Earnings per share growth, excluding the impact of mark-to-market accounting, is still expected to be between five and seven percent. Integration costs associated with the acquisition of the Pringles business are still expected to be in a range between $0.12 and $0.14 per share. As a result, earnings excluding the impact of mark-to-market accounting and integration costs are still anticipated to be between $3.82 and $3.91 per share.
Share Repurchase Authorization
The company also announced that the Board of Directors approved a share repurchase authorization of $1 billion, which expires in April of 2014. This authorization supersedes the existing authorization and is intended to allow the company to repurchase shares to offset the impact of proceeds from the exercise of options through the end of 2013, and to begin the company's 2014 purchase plan.
Conference Call / Webcast
Kellogg will host a conference call to discuss these results on May 2, 2013 at 9:30 a.m. Eastern Time. The conference call and accompanying presentation slides will be broadcast live over the Internet at http://investor.kelloggs.com. Analysts and institutional investors may participate in the Q&A session by dialing (877) 270-2148 in the U.S., and (412) 902-6510 outside of the U.S. Members of the media and the public are invited to attend in a listen-only mode. Rebroadcast information is available at http://investor.kelloggs.com.
About Kellogg Company
At Kellogg Company (NYSE:K), we are driven to enrich and delight the world through foods and brands that matter. With 2012 sales of $14.2 billion, Kellogg is the world's leading cereal company; second largest producer of cookies and crackers; a leading producer of savory snacks; and a leading North American frozen foods company. Every day, our well-loved brands nourish families so they can flourish and thrive. These brands include Kellogg's®, Keebler®, Special K®, Pringles®, Frosted Flakes®, Pop-Tarts®, Corn Flakes®, Rice Krispies®, Kashi®, Cheez-It®, Eggo®, Coco Pops®, Mini-Wheats®, and many more. To learn more about our responsible business leadership, foods that delight and how we strive to make a difference in our communities around the world, visit www.kelloggcompany.com.
Use of Non-GAAP Financial Measures
Certain financial measures have been provided on a non-GAAP (Generally Accepted Accounting Principles) basis. Management believes the use of such non-GAAP measures provides increased transparency and assists investors in understanding the underlying operating performance of the company and its segments and in the analysis of ongoing operating trends. All non-GAAP financial measures have been reconciled with the most directly comparable GAAP financial measures in the attachments provided with the release.
Forward-Looking Statements Disclosure
This news release contains, or incorporates by reference, "forward-looking statements" with projections concerning, among other things, the integration of the Pringles® business, the Company's strategy, and the Company's sales, earnings, margin, operating profit, costs and expenditures, interest expense, tax rate, capital expenditure, dividends, cash flow, debt reduction, share repurchases, costs, brand building, ROIC, working capital, growth, new products, innovation, cost reduction projects, and competitive pressures. Forward-looking statements include predictions of future results or activities and may contain the words "expects," "believes," "should," "will," "anticipates," "projects," "estimates," "implies," "can," or words or phrases of similar meaning.
The Company's actual results or activities may differ materially from these predictions. The Company's future results could also be affected by a variety of factors, including the ability to realize the anticipated benefits and synergies from the Pringles acquisition in the amounts and at the times expected, the impact of competitive conditions; the effectiveness of pricing, advertising, and promotional programs; the success of innovation, renovation and new product introductions; the recoverability of the carrying value of goodwill and other intangibles; the success of productivity improvements and business transitions; commodity and energy prices; labor costs; disruptions or inefficiencies in supply chain; the availability of and interest rates on short-term and long-term financing; actual market performance of benefit plan trust investments; the levels of spending on systems initiatives, properties, business opportunities, integration of acquired businesses, and other general and administrative costs; changes in consumer behavior and preferences; the effect of U.S. and foreign economic conditions on items such as interest rates, statutory tax rates, currency conversion and availability; legal and regulatory factors including changes in food safety, advertising and labeling laws and regulations; the ultimate impact of product recalls; business disruption or other losses from war, terrorist acts or political unrest; and other items.
Forward-looking statements speak only as of the date they were made, and the Company undertakes no obligation to update them publicly.
| Kellogg Company and Subsidiaries | ||
| CONSOLIDATED STATEMENT OF INCOME | ||
| (millions, except per share data) | ||
| Quarter ended | ||
| March 30, | March 31, | |
| (Results are unaudited) | 2013 | 2012 |
| Net sales | $3,861 | $3,440 |
| Cost of goods sold | 2,468 | $2,087 |
| Selling, general and administrative expense | 890 | 826 |
| Operating profit | 503 | 527 |
| Interest expense | 60 | 33 |
| Other income (expense), net | (7) | 13 |
| Income before income taxes | 436 | 507 |
| Income taxes | 124 | 156 |
| Earnings (loss) from joint ventures | (1) | -- |
| Net income | $311 | $351 |
| Net income (loss) attributable to noncontrolling interests | -- | -- |
| Net income attributable to Kellogg Company | $311 | $351 |
| Per share amounts: | ||
| Basic | $.86 | $.98 |
| Diluted | $.85 | $.98 |
| Dividends per share | $.4400 | $.4300 |
| Average shares outstanding: | ||
| Basic | 363 | 357 |
| Diluted | 366 | 359 |
| Actual shares outstanding at period end | 366 | 357 |
| Kellogg Company and Subsidiaries | ||
| SELECTED OPERATING SEGMENT DATA | ||
| (millions) | ||
| Quarter ended | ||
| March 30, | March 31, | |
| (Results are unaudited) | 2013 | 2012 |
| Net sales | ||
| U.S. Morning Foods | $911 | $897 |
| U.S. Snacks | 901 | 786 |
| U.S. Specialty | 379 | 348 |
| North America Other | 403 | 368 |
| Europe | 692 | 538 |
| Latin America | 308 | 270 |
| Asia Pacific | 267 | 233 |
| Consolidated | $3,861 | $3,440 |
| Operating profit | ||
| U.S. Morning Foods | $163 | $153 |
| U.S. Snacks | 106 | 123 |
| U.S. Specialty | 78 | 71 |
| North America Other | 75 | 70 |
| Europe | 71 | 70 |
| Latin America | 48 | 51 |
| Asia Pacific | 21 | 33 |
| Total Reportable Segments | 562 | 571 |
| Corporate | (59) | (44) |
| Consolidated | $503 | $527 |
| Kellogg Company and Subsidiaries | ||||
| CONSOLIDATED STATEMENT OF CASH FLOWS | ||||
| (millions) | ||||
| Quarter ended | ||||
| March 30, | March 31, | |||
| (unaudited) | 2013 | 2012 | ||
| Operating activities | ||||
| Net income | $311 | $351 | ||
| Adjustments to reconcile net income to operating cash flows: | ||||
| Depreciation and amortization | 113 | 95 | ||
| Postretirement benefit plan expense (benefit) | (4) | (5) | ||
| Deferred income taxes | 11 | (54) | ||
| Other | 23 | (1) | ||
| Postretirement benefit plan contributions | (31) | (25) | ||
| Changes in operating assets and liabilities, net of acquisitions | (85) | (21) | ||
| Net cash provided by (used in) operating activities | 338 | 340 | ||
| Investing activities | ||||
| Additions to properties | (102) | (63) | ||
| Other | -- | 6 | ||
| Net cash provided by (used in) investing activities | (102) | (57) | ||
| Financing activities | ||||
| Net reductions of notes payable | (226) | (178) | ||
| Issuances of long-term debt | 645 | -- | ||
| Reductions of long-term debt | (749) | -- | ||
| Net issuances of common stock | 265 | 41 | ||
| Common stock repurchases | (44) | (63) | ||
| Cash dividends | (160) | (153) | ||
| Other | 9 | (2) | ||
| Net cash provided by (used in) financing activities | (260) | (355) | ||
| Effect of exchange rate changes on cash and cash equivalents | (5) | 16 | ||
| Decrease in cash and cash equivalents | (29) | (56) | ||
| Cash and cash equivalents at beginning of period | 281 | 460 | ||
| Cash and cash equivalents at end of period | $252 | $404 | ||
| Supplemental financial data: | ||||
| Net cash provided by (used in) operating activities | $338 | $340 | ||
| Additions to properties | (102) | (63) | ||
| Cash Flow (operating cash flow less property additions) (a) | $236 | $277 | ||
| (a) We use this non-GAAP measure of cash flow to focus management and investors on the amount of cash available for debt reduction, dividend distributions, acquisition opportunities, and share repurchase. | ||||
| Kellogg Company and Subsidiaries | ||
| CONSOLIDATED BALANCE SHEET | ||
| (millions, except per share data) | ||
| March 30, | December 29, | |
| 2013 | 2012 | |
| (unaudited) | * | |
| Current assets | ||
| Cash and cash equivalents | $252 | $281 |
| Accounts receivable, net | 1,588 | 1,454 |
| Inventories: | ||
| Raw materials and supplies | 312 | 300 |
| Finished goods and materials in process | 972 | 1,065 |
| Deferred income taxes | 168 | 152 |
| Other prepaid assets | 170 | 128 |
| Total current assets | 3,462 | 3,380 |
| Property, net of accumulated depreciation of $5,227 and $5,209 | 3,745 | 3,782 |
| Goodwill | 5,058 | 5,053 |
| Other intangibles, net of accumulated amortization of $55 and $53 | 2,346 | 2,359 |
| Pension | 163 | 145 |
| Other assets | 450 | 465 |
| Total assets | $15,224 | $15,184 |
| Current liabilities | ||
| Current maturities of long-term debt | $1 | $755 |
| Notes payable | 838 | 1,065 |
| Accounts payable | 1,447 | 1,402 |
| Accrued advertising and promotion | 459 | 517 |
| Accrued income taxes | 87 | 46 |
| Accrued salaries and wages | 201 | 266 |
| Other current liabilities | 535 | 472 |
| Total current liabilities | 3,568 | 4,523 |
| Long-term debt | 6,717 | 6,082 |
| Deferred income taxes | 563 | 523 |
| Pension liability | 873 | 886 |
| Nonpension postretirement benefits | 277 | 281 |
| Other liabilities | 384 | 409 |
| Commitments and contingencies | ||
| Equity | ||
| Common stock, $.25 par value | 105 | 105 |
| Capital in excess of par value | 583 | 573 |
| Retained earnings | 5,749 | 5,615 |
| Treasury stock, at cost | (2,709) | (2,943) |
| Accumulated other comprehensive income (loss) | (947) | (931) |
| Total Kellogg Company equity | 2,781 | 2,419 |
| Noncontrolling interests | 61 | 61 |
| Total equity | 2,842 | 2,480 |
| Total liabilities and equity | $15,224 | $15,184 |
| * Condensed from audited financial statements. | ||
| Kellogg Company and Subsidiaries | |
| Reconciliation of Non-GAAP Amounts - Reported Operating Profit Growth to | |
| Underlying Internal Operating Profit Growth | |
| Quarter ended | |
| March 30, 2013 | |
| Reported Operating Profit Growth | -4.5% |
| Acquisitions/Dispositions | 7.6% |
| Integration costs | -3.8% |
| Foreign currency | -1.4% |
| Internal Operating Profit Growth(a) | -6.9% |
| Mark-to-market(b) | -1.1% |
| Underlying Internal Operating Profit Growth(c) | -5.8% |
| (a) Internal operating profit growth excludes the impact of foreign currency, and, if applicable, acquisitions, dispositions, and transaction and integration costs associated with the acquisition of Pringles. The Company believes the use of this non-GAAP measure provides increased transparency and assists in understanding underlying operating performance. This non-GAAP measure is reconciled to the directly comparable measure in accordance with U.S. GAAP within this table. | |
| (b) Includes mark-to-market adjustments for pension plans and commodity contracts as reflected in cost of goods sold. Actuarial gains/losses for pension plans are recognized in the year they occur. In 2012, asset returns exceeded expectations but discount rates fell almost 100 basis points for pension plans resulting in a net loss. A portion of the 2012 pension mark-to-market adjustment was capitalized as an inventoriable cost at the end of 2012. This amount has been recorded in earnings in the current quarter. Mark-to-market adjustments for commodities reflect the changes in the fair value of contracts for the difference between contract and market prices for the underlying commodities. The resulting gains/losses are recognized in the quarter they occur. | |
| (c) Underlying internal operating profit growth excludes the impact of foreign currency translation, pension and commodity mark-to-market adjustments, and, if applicable, acquisitions, dispositions, and transaction and integration costs associated with the acquisition of Pringles. The Company believes the use of this non-GAAP measure provides increased transparency and assists in understanding the underlying operating performance. This non-GAAP measure is reconciled to the directly comparable measure in accordance with U.S. GAAP within this table. | |
| Kellogg Company and Subsidiaries | ||||||||||
| Analysis of net sales and operating profit performance | ||||||||||
| First quarter of 2013 versus 2012 | ||||||||||
| (dollars in millions) |
U.S. Morning Foods |
U.S. Snacks |
U.S. Specialty |
North America Other |
North America |
Europe |
Latin America |
Asia Pacific |
Corp- orate |
Consoli- dated |
| 2013 net sales | $ 911 | $ 901 | $ 379 | $ 403 | $ 2,594 | $ 692 | $ 308 | $ 267 | $ -- | $ 3,861 |
| 2012 net sales | $ 897 | $ 786 | $ 348 | $ 368 | $ 2,399 | $ 538 | $ 270 | $ 233 | $ -- | $ 3,440 |
| % change - 2013 vs. 2012: | ||||||||||
| Volume (tonnage) (a) | 1.2% | 1.6% | .2% | 5.0% | -- | 1.4% | ||||
| Pricing/mix | .5% | 1.0% | 7.2% | -4.7% | -- | .8% | ||||
| Subtotal - internal business (b) | 1.6% | -1.7% | 3.4% | 7.4% | 1.7% | 2.6% | 7.4% | .3% | -- | 2.2% |
| Acquisitions (c) | --% | 16.3% | 5.3% | 3.2% | 6.6% | 27.3% | 8.6% | 20.8% | -- | 11.0% |
| Dispositions (d) | --% | --% | --% | --% | --% | --% | --% | -1.7% | -- | -.1% |
| Integration impact (e) | --% | --% | --% | -.2% | -.1% | --% | --% | -.4% | -- | -.1% |
| Foreign currency impact | --% | --% | --% | -.6% | -.1% | -1.2% | -2.3% | -4.3% | -- | -.8% |
| Total change | 1.6% | 14.6% | 8.7% | 9.8% | 8.1% | 28.7% | 13.7% | 14.7% | -- | 12.2% |
| (dollars in millions) |
U.S. Morning Foods |
U.S. Snacks |
U.S. Specialty |
North America Other |
North America |
Europe |
Latin America |
Asia Pacific |
Corp- orate |
Consoli- dated |
| 2013 operating profit | $ 163 | $ 106 | $ 78 | $ 75 | $ 422 | $ 71 | $ 48 | $ 21 | $ (59) | $ 503 |
| 2012 operating profit | $ 153 | $ 123 | $ 71 | $ 70 | $ 417 | $ 70 | $ 51 | $ 33 | $ (44) | $ 527 |
| % change - 2013 vs. 2012: | ||||||||||
| Internal business (b) | 5.9% | -25.6% | 6.4% | 4.5% | -3.5% | .1% | -5.6% | -30.6% | -19.7% | -6.9% |
| Acquisitions (c) | --% | 15.3% | 4.6% | 3.9% | 5.9% | 14.2% | 6.2% | 15.2% | -3.1% | 7.9% |
| Dispositions (d) | --% | --% | --% | --% | --% | --% | --% | -4.7% | --% | -.3% |
| Integration impact (e) | --% | -3.0% | --% | -1.2% | -1.1% | -11.1% | -.3% | -14.2% | -6.3% | -3.8% |
| Foreign currency impact | --% | -% | --% | -.7% | -.1% | -2.0% | -7.6% | -1.7% | -1.0% | -1.4% |
| Total change | 5.9% | -13.3% | 11.0% | 6.5% | 1.2% | 1.2% | -7.3% | -36.0% | -30.1% | -4.5% |
| (a) The Company measures the volume impact (tonnage) on revenues based on the stated weight of product shipments. | ||||||||||
| (b) Internal net sales and operating profit growth for 2013 exclude the impact of acquisitions, divestitures, integration costs and the impact of currency. Internal net sales and operating profit growth are non-GAAP financial measures which are reconciled to the directly comparable measures in accordance with U.S. GAAP within these tables. | ||||||||||
| (c) Impact of results for the quarter ended March 30, 2013 from the acquisition of Pringles. | ||||||||||
| (d) Impact of results for the quarter ended March 30, 2013 from the divestiture of Navigable Foods. | ||||||||||
| (e) Includes impact of integration costs associated with the Pringles acquisition. | ||||||||||
| Kellogg Company and Subsidiaries | ||||||
| Up-Front Costs* | ||||||
| $ millions | ||||||
| Quarter ended March 30, 2013 | ||||||
|
Cost of goods sold |
Selling, general and administrative expense |
Total |
||||
| 2013 | ||||||
| U.S. Morning Foods | $ 1 | $ 2 | $ 3 | |||
| U.S. Snacks | 1 | 2 | 3 | |||
| U.S. Specialty | -- | 1 | 1 | |||
| North America Other | -- | -- | -- | |||
| Europe | -- | -- | -- | |||
| Latin America | -- | -- | -- | |||
| Asia Pacific | 6 | -- | 6 | |||
| Corporate | -- | -- | -- | |||
| Total | $ 8 | $ 5 | $ 13 | |||
| Quarter ended March 31, 2012 | ||||||
|
Cost of goods sold |
Selling, general and administrative expense |
Total |
||||
| 2012 | ||||||
| U.S. Morning Foods | $ 2 | $ 2 | $ 4 | |||
| U.S. Snacks | 2 | 1 | 3 | |||
| U.S. Specialty | -- | -- | -- | |||
| North America Other | -- | 1 | 1 | |||
| Europe | 1 | -- | 1 | |||
| Latin America | -- | -- | -- | |||
| Asia Pacific | -- | -- | -- | |||
| Corporate | -- | -- | -- | |||
| Total | $ 5 | $ 4 | $ 9 | |||
| 2013 Variance - better(worse) than 2012 | ||||||
| U.S. Morning Foods | $ 1 | $ -- | $ 1 | |||
| U.S. Snacks | 1 | (1) | -- | |||
| U.S. Specialty | -- | (1) | (1) | |||
| North America Other | -- | 1 | 1 | |||
| Europe | 1 | -- | 1 | |||
| Latin America | -- | -- | -- | |||
| Asia Pacific | (6) | -- | (6) | |||
| Corporate | -- | -- | -- | |||
| Total | $ (3) | $ (1) | $ (4) | |||
| * Up-front costs are charges incurred by the Company which will result in future cash savings and/or reduced depreciation. | ||||||
| Kellogg Company and Subsidiaries | |||||
| Transaction and Integration Costs* | |||||
| $ millions | |||||
| Quarter ended March 30, 2013 | |||||
|
Net Sales |
Cost of goods sold |
Selling, general and administrative expense |
Other Income/Expense |
Total |
|
| 2013 | |||||
| U.S. Snacks | $ -- | $ -- | $ 3 | $ -- | $ 3 |
| North America Other | 1 | -- | -- | -- | 1 |
| Europe | -- | 3 | 5 | -- | 8 |
| Asia Pacific | 1 | 1 | 3 | -- | 5 |
| Corporate | -- | -- | 3 | -- | 3 |
| Total | $ 2 | $ 4 | $ 14 | $ -- | $ 20 |
| Quarter ended March 31, 2012 | |||||
|
Net Sales |
Cost of goods sold |
Selling, general and administrative expense |
Other Income/Expense |
Total |
|
| 2012 | |||||
| U.S. Snacks | $ -- | $ -- | $ -- | $ -- | $ -- |
| North America Other | -- | -- | -- | -- | -- |
| Europe | -- | -- | -- | -- | -- |
| Asia Pacific | -- | -- | -- | -- | -- |
| Corporate | -- | -- | -- | -- | -- |
| Total | $ -- | $ -- | $ -- | $ -- | $ -- |
| 2013 Variance - better(worse) than 2012 | |||||
| U.S. Snacks | $ -- | $ -- | $ (3) | $ -- | $ (3) |
| North America Other | (1) | -- | -- | -- | (1) |
| Europe | -- | (3) | (5) | -- | (8) |
| Asia Pacific | (1) | (1) | (3) | -- | (5) |
| Corporate | -- | -- | (3) | -- | (3) |
| Total | $ (2) | $ (4) | $ (14) | $ -- | $ (20) |
| * Transaction and integration costs are charges incurred by the Company as a direct result of the work performed for the acquisition of the Pringles business. No transaction costs were incurred during the quarter ended March 30, 2013. | |||||
| Kellogg Company and Subsidiaries | |||||||
| RECAST SEGMENT DATA | |||||||
| 2012 (millions) | Quarter ended | Year-to-date period ended | |||||
|
March 31, 2012 |
June 30, 2012 |
September 29, 2012 |
December 29, 2012 |
June 30, 2012 |
September 29, 2012 |
December 29, 2012 |
|
| Net Sales (Recast*) | |||||||
| U.S. Morning Foods | $ 897 | $ 892 | $ 903 | $ 841 | $ 1,789 | $ 2,692 | $ 3,533 |
| U.S. Snacks | 786 | 850 | 908 | 856 | 1,636 | 2,544 | 3,400 |
| U.S. Specialty | 348 | 252 | 264 | 257 | 600 | 864 | 1,121 |
| North America Other | 368 | 369 | 388 | 360 | 737 | 1,125 | 1,485 |
| North America Total | 2,399 | 2,363 | 2,463 | 2,314 | 4,762 | 7,225 | 9,539 |
| Europe | 538 | 613 | 685 | 691 | 1,151 | 1,836 | 2,527 |
| Latin America | 270 | 274 | 292 | 285 | 544 | 836 | 1,121 |
| Asia Pacific | 233 | 224 | 280 | 273 | 457 | 737 | 1,010 |
| Consolidated | $ 3,440 | $ 3,474 | $ 3,720 | $ 3,563 | $ 6,914 | $ 10,634 | $ 14,197 |
| Operating Profit (Recast*) | |||||||
| U.S. Morning Foods | $ 153 | $ 178 | $ 134 | $ 123 | $ 331 | $ 465 | $ 588 |
| U.S. Snacks | 123 | 121 | 117 | 115 | 244 | 361 | 476 |
| U.S. Specialty | 71 | 56 | 62 | 52 | 127 | 189 | 241 |
| North America Other | 70 | 70 | 67 | 58 | 140 | 207 | 265 |
| North America Total | 417 | 425 | 380 | 348 | 842 | 1,222 | 1,570 |
| Europe | 70 | 64 | 76 | 51 | 134 | 210 | 261 |
| Latin America | 51 | 48 | 36 | 32 | 99 | 135 | 167 |
| Asia Pacific | 33 | 17 | 29 | 6 | 50 | 79 | 85 |
| Total Reportable Segments | 571 | 554 | 521 | 437 | 1,125 | 1,646 | 2,083 |
| Corporate | (44) | (35) | (8) | (434) | (79) | (87) | (521) |
| Consolidated | $ 527 | $ 519 | $ 513 | $ 3 | $ 1,046 | $ 1,559 | $ 1,562 |
| * During the first quarter of 2013, the Kashi operating segment was eliminated. The Kashi financial results have been recast between U.S. Morning Foods and U.S. Snacks. | |||||||
| 2012 (millions) | Quarter ended | Year-to-date period ended | |||||
|
March 31, 2012 |
June 30, 2012 |
September 29, 2012 |
December 29, 2012 |
June 30, 2012 |
September 29, 2012 |
December 29, 2012 |
|
| Net Sales (As originally reported) | |||||||
| U.S. Morning Foods & Kashi | $ 941 | $ 939 | $ 946 | $ 881 | $ 1,880 | $ 2,826 | $ 3,707 |
| U.S. Snacks | 742 | 803 | 865 | 816 | 1,545 | 2,410 | 3,226 |
| U.S. Specialty | 348 | 252 | 264 | 257 | 600 | 864 | 1,121 |
| North America Other | 368 | 369 | 388 | 360 | 737 | 1,125 | 1,485 |
| North America Total | 2,399 | 2,363 | 2,463 | 2,314 | 4,762 | 7,225 | 9,539 |
| Europe | 538 | 613 | 685 | 691 | 1,151 | 1,836 | 2,527 |
| Latin America | 270 | 274 | 292 | 285 | 544 | 836 | 1,121 |
| Asia Pacific | 233 | 224 | 280 | 273 | 457 | 737 | 1,010 |
| Consolidated | $ 3,440 | $ 3,474 | $ 3,720 | $ 3,563 | $ 6,914 | $ 10,634 | $ 14,197 |
| Operating Profit (As originally reported) | |||||||
| U.S. Morning Foods & Kashi | $ 157 | $ 181 | $ 135 | $ 122 | $ 338 | $ 473 | $ 595 |
| U.S. Snacks | 119 | 118 | 116 | 116 | 237 | 353 | 469 |
| U.S. Specialty | 71 | 56 | 62 | 52 | 127 | 189 | 241 |
| North America Other | 70 | 70 | 67 | 58 | 140 | 207 | 265 |
| North America Total | 417 | 425 | 380 | 348 | 842 | 1,222 | 1,570 |
| Europe | 70 | 64 | 76 | 51 | 134 | 210 | 261 |
| Latin America | 51 | 48 | 36 | 32 | 99 | 135 | 167 |
| Asia Pacific | 33 | 17 | 29 | 6 | 50 | 79 | 85 |
| Total Reportable Segments | 571 | 554 | 521 | 437 | 1,125 | 1,646 | 2,083 |
| Corporate | (44) | (35) | (8) | (434) | (79) | (87) | (521) |
| Consolidated | $ 527 | $ 519 | $ 513 | $ 3 | $ 1,046 | $ 1,559 | $ 1,562 |
| Kellogg Company and Subsidiaries | ||
| Reconciliation of Non-GAAP Amounts - Reported Operating Profit | ||
| to Comparable Operating Profit | ||
| Quarter ended | ||
|
March 30, 2013 |
March 31, 2012 |
|
| Reported Operating Profit | $ 503.2 | $ 526.7 |
| Mark-to-market(a) | (53.7) | (50.6) |
| Underlying Operating Profit(b) | $ 556.9 | $ 577.3 |
| Pringles integration costs | (20.1) | -- |
| Comparable Operating Profit(c) | $ 577.0 | $ 577.3 |
| (a) Includes mark-to-market adjustments for pension plans and commodity contracts as reflected in cost of goods sold. Actuarial gains/losses for pension plans are recognized in the year they occur. In 2012, asset returns exceeded expectations but discount rates fell almost 100 basis points for pension plans resulting in a net loss. A portion of the 2012 pension mark-to-market adjustment was capitalized as an inventoriable cost at the end of 2012. This amount has been recorded in earnings in the current quarter. In 2011, asset returns were lower than expected and discount rates declined. A portion of the 2011 pension mark-to-market adjustment was capitalized as an inventoriable cost at the end of 2011. This amount was recorded in earnings in the first quarter of 2012. Mark-to-market adjustments for commodities reflect the changes in the fair value of contracts for the difference between contract and market prices for the underlying commodities. The resulting gains/losses are recognized in the quarter they occur. | ||
| (b) Underlying Operating Profit excludes the impact of mark-to-market adjustments on pension plans and commodity contracts. The Company believes the use of this non-GAAP measure provides increased transparency and assists in understanding underlying operating performance. This non-GAAP measure is reconciled to the directly comparable measure in accordance with U.S. GAAP within this table. | ||
| (c) Comparable Operating Profit is a non-GAAP measure that excludes the impact of mark-to-market adjustments on pension plans and commodity contracts, and the impact of integration costs related to the acquisition of the Pringles business. | ||
| Kellogg Company and Subsidiaries | ||
| Reconciliation of Non-GAAP Amounts - Reported EPS | ||
| to Comparable EPS | ||
| Quarter ended | ||
|
March 30, 2013 |
March 31, 2012 |
|
| Reported EPS | $ 0.85 | $ 0.98 |
| Mark-to-market(a) | (0.10) | (0.10) |
| Underlying EPS(b) | $ 0.95 | $ 1.08 |
| Pringles Integration costs | (0.04) | -- |
| Comparable EPS(c) | $ 0.99 | $ 1.08 |
| (a) Includes mark-to-market adjustments for pension plans and commodity contracts as reflected in cost of goods sold. Actuarial gains/losses for pension plans are recognized in the year they occur. In 2012, asset returns exceeded expectations but discount rates fell almost 100 basis points for pension plans resulting in a net loss. A portion of the 2012 pension mark-to-market adjustment was capitalized as an inventoriable cost at the end of 2012. This amount has been recorded in earnings in the current quarter. In 2011, asset returns were lower than expected and discount rates declined. A portion of the 2011 pension mark-to-market adjustment was capitalized as an inventoriable cost at the end of 2011. This amount was recorded in earnings in the first quarter of 2012. Mark-to-market adjustments for commodities reflect the changes in fair value of contracts for the difference between contract and market prices for the underlying commodities. The resulting gains/losses are recognized in the quarter they occur. | ||
| (b) Underlying EPS is a non-GAAP measure that excludes the impact of pension and commodity mark-to-market adjustments. | ||
| (c) Comparable EPS is a non-GAAP measure that excludes the impact of mark-to-market adjustments on pension plans and commodity contracts, and the impact of integration costs related to the acquisition of the Pringles business. | ||