Milling & Baking News Corporate Profiles - November 2013 - (Page 106)

Company Overview Kellogg Co. Company adjusts to challenges in cereal, resets management structure C " hange" may be the best word to describe what has transpired at Battle Creek, Mich.-based Kellogg Co. over the past year. In 2012, the focus was on setting the company up to build a global snack business following the purchase of Pringles for $2.695 million from Procter & Gamble Co. In 2013, Kellogg has shifted direction to enter new categories, address challenges in cereal and ensure the company's organization is more nimble and execution-oriented. Growth in snacks and specialty foods helped offset "disappointing" growth in the cereal category throughout much of 2013 at Kellogg Co. Weakness stemmed from the adult cereal category, but the company has taken steps to reverse the trend through innovation and education, including a "healthy dividends" strategy. "Healthy dividends is targeted at adult health-conscious consumers and focuses on bringing boomers into the cereal category," John Bryant, president and chief executive officer, said during an Aug. 5 conference call with analysts. "For example, the campaign highlights the benefits that come from a balanced diet, including cereal and a healthy lifestyle." Kellogg is hoping to get a boost from the Kashi brand. The brand was acquired in 2000, and Kellogg earlier this year moved Kashi's headquarters to Battle Creek from La Jolla, Calif., to better position it for growth. With a view toward greater opportunities in the cereal category, Kellogg also this year stepped outside its comfort zone of ready-to-eat cereals with the launch of products that will exist outside the traditional category. Two products include Kellogg To Go and Nutri-Grain Biscuits. Kellogg To Go is a breakfast beverage that has 10 grams of protein and 5 grams of fiber. Meanwhile, Nutri-Grain Biscuits provide consumers with a cereal alternative without the need for milk. In what is part of a significant management reorganization at Kellogg, Paul T. Norman has been promoted to the newly created position of chief growth officer at Kellogg Co. At the same time, Brad J. Davidson, president of Kellogg North America, is retiring. The changes took effect Oct. 1. Chris Hood has been promoted to succeed Mr. Norman as president of Kellogg Europe. Chief executive officer - Top brands - 2012 global sales - John Bryant 106 \ November 2013 With the changes, the roles of president, Kellogg North America (the position held by Mr. Davidson), and president, Kellogg International (the position held by Mr. Norman), will be eliminated, Kellogg said. Business units falling under Kellogg North America - U.S. Morning Foods, U.S. Snacks, U.S. Frozen Foods, U.S. Specialty Channels and Canada - will report directly to Mr. Bryant. The company said the revised reporting chain "reflects the size and importance of these businesses." Mr. Bryant said the new structure will "position the company well for future growth." Kellogg in early October idled a cereal plant in Memphis, Tenn., the same facility at which the company earlier this year announced a round of layoffs. Kellogg makes a variety of cereals at the Memphis plant, including Apple Jacks and Froot Loops. For the six months ended June 29, net income at Kellogg was $663 million, equal to $1.82 per share on the common stock, down 2% from $675 million, or $1.89 per share, in the same period a year ago. Net sales were $7,575 million, up 10% from $6,914 million. CP $14.2 billion Special K Cheez-It Town House Corn Flakes Eggo Keebler Morningstar Farms Pringles Rice Krispies Milling & Baking News * Food Business News * Baking & Snack * Meat & Poultry Corporate Profiles

Table of Contents for the Digital Edition of Milling & Baking News Corporate Profiles - November 2013

Milling & Baking News Corporate Profiles - November 2013