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The Pringles maker, which is in the process of a three-way break-up of its business, also said it has decided to keep its plant-based business, which represents 2% of net sales, in-house. Kellogg (NYSE:K) had last June announced plans to explore strategic options for its profitable MorningStar Farms business.
Americans have so far taken price hikes for snacks and breakfast cereals in stride even as decades-high inflation forces consumers to dial back spending, resulting in increasingly tight household budgets.
Kellogg joins other major food and beverage companies, including Oreo maker Mondelez International Inc (NASDAQ:MDLZ), Coca-Cola (NYSE:KO) Co and Hershey, in using its brand power and distribution scale to pass on price increases to consumers while seeing little pushback in demand.
The company forecast organic sales growth of 5% to 7% for full year 2023, as it expects sustained demand for its snacks and emerging markets business region.
Shares of the Michigan-based company rose 1.5% before the bell.
Kellogg’s net sales rose 12% to $3.83 billion in the fourth quarter ended Dec. 31. Analysts had expected revenue of $3.66 billion, based on Refinitiv IBES data.
The company reported a net loss of $98 million or 29 cents per share in the quarter, compared to a profit of $433 million or $1.26 per share a year earlier, as it incurred charges related to its spin-off.
On an adjusted basis, Kellogg earned 94 cents per share, beating analysts’ estimate of 84 cents.
