Kellogg Company (K) saw its loss widen to $53 million, or $0.15 a share for the quarter ended Dec. 31, 2016. In the previous year period, the company reported a loss of $41 million, or $0.12 a share. On the other hand, adjusted net income for the quarter stood at $324 million, or $0.92 a share compared with $279 million or $0.79 a share, a year ago.
Revenue during the quarter went down marginally by 1.43 percent to $3,097 million from $3,142 million in the previous year period. Gross margin for the quarter expanded 90 basis points over the previous year period to 31.51 percent. Operating margin for the quarter period stood at positive 3.16 percent as compared to a negative 1.24 percent for the previous year period.
Operating income for the quarter was $98 million, compared with an operating loss of $39 million in the previous year period.
However, the adjusted operating income for the quarter stood at $494 million compared to $440 million in the prior year period. At the same time, adjusted operating margin improved 195 basis points in the quarter to 15.95 percent from 14 percent in the last year period.
"Our fourth quarter earnings exceeded our expectations, as operating-profit margins continued to improve, and as we again showed sequential improvement in our sales performance," said John Bryant, Kellogg Company's chairman and chief executive officer. "We also have announced that we are exiting our direct store delivery system in U.S. Snacks, in order to redirect our resources in a way that can better market our brands to today's evolving shopper and retail channels. This will keep us firmly on our path to our 2018 operating profit margin expansion target and lead to better top-line performance."
For the financial year 2017, Kellogg Company projects revenue to decline by 2 percent. It expects adjusted revenue to decline by 4 percent. It forecasts operating income to grow in the range of 7 percent to 9 percent. It forecasts adjusted operating income to grow in the range of 4.60 percent to 6.60 percent. It expects diluted earnings per share to be in the range of $4.03 to $4.09. It expects diluted earnings per share to be in the range of $3.91 to $3.97 on adjusted basis for the same period.
Operating cash flow falls marginally
Kellogg Company has generated cash of $1,628 million from operating activities during the year, down 3.73 percent or $63 million, when compared with the last year.
The company has spent $893 million cash to meet investing activities during the year as against cash outgo of $1,127 million in the last year.
The company has spent $642 million cash to carry out financing activities during the year as against cash outgo of $706 million in the last year period.
Cash and cash equivalents stood at $280 million as on Dec. 31, 2016, up 11.55 percent or $29 million from $251 million on Jan. 02, 2016.
Working capital remains negative
Working capital of Kellogg Company was negative $1,534 million on Dec. 31, 2016 compared with negative $2,503 million on Jan. 02, 2016. Current ratio was at 0.66 as on Dec. 31, 2016, up from 0.56 on Jan. 02, 2016.
Debt remains almost stable
Total debt of Kellogg Company remained almost stable for the quarter at $7,767 million, when compared with the last year period. Total debt was 51.40 percent of total assets as on Dec. 31, 2016, compared with 50.74 percent on Jan. 02, 2016. Debt to equity ratio was at 4.03 as on Dec. 31, 2016, up from 3.62 as on Jan. 02, 2016.
Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
