Editor's Note: This content was originally published on
by Bruce Kennedy.
Wall Street may be pleased with the third-quarter earnings report
issued Monday by The
), but company employees are having to digest the news that 7% of
their workforce is about to be cut as part of a major restructuring
The world's largest producer of breakfast cereals
3Q net sales of $3.7 billion, beating analysts' expectations, with
net earnings for the quarter of $326 million. The quarter's
earnings per share included a cost of about twocents per share in
integration costs, linked to Kellogg's acquisition of the
snack brand last year from
Procter & Gamble
), in a $2.7 billion cash-all transaction.
The company says it now expects its full-year reported earnings to
be "toward the lower end" of the $3.75 to $3.84 per share range -
due in part to "weaker than expected sales in certain of the
categories in which the company competes."
reports Kellogg's is dealing with increased competition from
) and other cereal manufacturers for market share, as a growing
number of consumers turn away from old-school packaged cereals in
favor of yogurt, fruit, microwavable breakfast sandwiches and other
options for their morning meals. Its snack food lines have also
been under pressure.
As part of itsearnings report , Kellogg's also announced a four
year "efficiency and effectiveness"program, called Project K -
meant to focus, in part, on increasing growth in developing and
emerging markets worldwide. The company also estimates that, by the
end of 2017, the Project K restructuring will cut its global
workforce by about 7% - or nearly 2,200 jobs.
, Kellogg President and CEO John Bryant said the company was
"making the difficult decisions necessary to address structural
cost-saving opportunities, which will enable us to increase
investment in our core markets and in opportunities for future
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