Kellogg Company announced second-quarter results. EPS was in-line with the company's expectations.
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The Asian, Latin American, and European Snack businesses posted currency-neutral comparable net sales growth and the North American business benefited from improving trends.
Second-quarter 2015 reported net sales decreased by 5.1 percent to $3.5 billion, largely as the result of currency translation.
Currency-neutral comparable net sales increased by 0.1 percent in the second quarter; sales increased in the Latin American and Asia Pacific regions and in the Frozen Foods and Canadian businesses in North America.
Second quarter 2015 reported operating profit was $412 million, a decline of 11.6 percent; this decrease was driven primarily by up-front costs associated with Project K, a remeasurement of the Venezuelan business at the SIMADI rate of 198 Venezuelan bolivars per U.S. dollar), and foreign-currency exchange.
Currency-neutral comparable operating profit declined by 6.8 percent due to higher distribution costs, costs associated with the timing of production, and the resetting of incentive compensation.
Reported earnings for the second quarter of 2015 were $223 million, or $0.63 per share, a decrease of 23 percent from the $0.82 per share reported in the second quarter of last year.
This quarter's reported earnings per share included negative impacts from the remeasurement of the Venezuelan business of $0.37 per share, costs associated with the Project K efficiency and effectiveness program of $0.18 per share and $0.01 per share of integration costs related to the acquisition of Pringles and Bisco Misr.
In addition, reported results included a benefit of $0.06 per share from mark-to-market and a benefit of $0.21 per share from the deconsolidation of a variable interest entity.
Excluding all of these items, comparable second-quarter 2015 earnings were $0.92 per share. This result included a negative impact of $0.05 per share from currency translation; currency-neutral comparable earnings per share were $0.97 per share. ■