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• The food company raised its organic sales growth forecast for 2022 to 4%
Shares of Kellogg Co (NYSE: K) soared on Thursday as the food company topped quarterly estimates and raised its sales forecast for 2022.
Kellogg raised its organic sales growth forecast for 2022 to 4%, up from the previous guidance of 3%. The company reported adjusted earnings of $1.23 per share in the first quarter, beating estimates of 93 cents, according to FactSet.
Net sales of the company was $3.67 billion, above analysts’ estimates of $3.59 billion.
Shares of the company rose 4%.
Price hike
Due to the global supply chain disruptions, price of the ingredients such as wheat, corn and edible oils have increased, which has led to the price hike of packaged foods by companies.
Kellogg said it was increasing product prices amid supply disruptions and also expects slowdown in cereal demand due to rising inflation.
The company also said because of the nearly three-month workers’ strike at North America plants, cereal sales fell by 10.3% in the first quarter in the area. Cereal shortage due to the strike could last for at least the first half of the year, said Kellogg.
Russia-Ukraine war has also affected the company as Europe is a major source of ingredients for packaged food companies.
Picture Credits: Reuters
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