On Tuesday, Kellogg Co. posted a third quarter profit that was higher with a minor increase in its net sales. Both its top line and comparable per share earnings were able beat expectations in the market. In addition, the company increased its fiscal comparable per share earnings outlook for fiscal 2017, above the estimates on Wall Street.
Kellogg also kept its sales as well as operating profit outlook.
During trading before the opening bell on the New York Stock Exchange, shares of Kellogg increased by as much as 4.4%.
During the third quarter, Kellogg’s net income was up 1.7% ending at $297 million compared to $292 million for the same period one year ago. Per share earnings were higher by 3.7% from 82 cents last year to a current 85 cents.
Net sales reported were up 0.6% ending the three-month period at $3.27 billion compared to $3.25 billion for the same period last year, which in part was due to its acquisition in December of 2016 of Parati based in Brazil, and favorable currency exchange.
Kellogg’s comparable net sales were down 0.8%, while net sale that were currency neutral dropped by 1.4%.
Analysts on average were expecting earnings per share of 94 cents with sales reaching $3.21 billion during the quarter.
Chairman of Kellogg John Bryant said that the company’s third quarter ended as expected. Operating profit margin growth was given an additional boost from its transition out of Direct-Store Delivery, as well as posting another three-month period of improvement in net sales.
There are some timing benefits built in for the fourth quarter, but the results for the third quarter puts the company on track to end the full year delivering on the financial guidance estimates, at a time when new CEO Steve Cahillane will be taking over.
For its fiscal 2017, Kellogg continues forecasting a drop in comparable net sale that are currency neutral of 3%, with no adjustment to estimates for DSD exit impact or the remainder of its business.
Guidance was reaffirmed for growth of comparable operating profit, which Kellogg still is expecting to end the year with growth of between 7% and 9% compared to the same period last year.
The company, related to a comparable basis, expects per share earnings of between $4.00 and $4.06 for all of 2017.