(Reuters) – Packaged food company Kellanova beat Wall Street expectations for fourth-quarter earnings on Thursday, on the back of steady demand for its snacks and breakfast cereals such as Pringles and Cheez-It.
While other packaged food companies such as Conagra and McCormick are facing a demand slowdown as customers cut back on ready-to-eat meals, Kellanova has managed to drive demand by diversifying its offerings.
Kellanova has introduced products such as Tresor Brownie and also partnered with Taco Bell to add Cheez-It to the fast food chain’s menus.
The Pop-Tarts maker is also seeing customers choose its cereals and frozen breakfast as they pare back spending at restaurants to save money.
The company is in the process of being bought out by family-owned snacking company Mars. As a result, Kellanova said it would not provide a full year forecast.
Kellanova has also seen a jump in its gross profit margin through the year, mainly driven by higher prices and easing input cost inflation, helping offset increased marketing spend.
Volume grew 2.8% in the quarter, even as pricing rose 4.2%.
The company posted net sales of $3.12 billion, beating estimates of 3.10 billion according to data compiled by LSEG.
The company earned 92 cents per share in the quarter ended Dec. 28, beating expectations of 83 cents.
(Reporting by Aamir Sohail in Bengaluru; Editing by Krishna Chandra Eluri)
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