Kellogg’s New York shares decline
Kellogg’s recently saw a decline in its New York shares, off the back of the Special K owner’s annual earnings report, which predicted a negative assessment for organic growth in the new financial year.
Compared to a flat performance in 2018, Kellogg’s organic sales rose by 1.9% in 2019. However, the company’s shares were down by more than 7% in New York last week, after chief executive Steve Cahillane projected a less-than-stellar performance for the next 12 months.
Cahillane’s outlook includes the risk of a dip in growth to 1% and the top end of his 2% guidance isn’t inspiring. It suggests the CEO is cautious about the future despite his recently-employed Deploy for Growth strategy designed to change perceptions of Kellogg’s as a cereal-centric business.
The outlook leaves investors questioning where growth is going to be generated from in the first year of this new decade — especially as cereals in North America declined again over the past 12 months and are only just stabilising in Europe following a stagnation period amid changing in early-morning eating habits.
The question now is whether Kellogg’s other products in its portfolio — snacks and frozen foods — can help increase the company’s shares if the Kellogg’s does not see a resurgence from its cereal.
