CHICAGO – Kellogg Co. (K), the world's largest cereal maker, Monday said quarterly earnings dipped due to a higher tax rate, higher promotional spending and expenses related to cost-cutting measures.
Net income for the fourth quarter ended Jan. 1 fell to $186.4 million, or 45 cents per share, from $188 million, or 46 cents per share, a year earlier.
Wall Street analysts had expected the company to report earnings between 43 cents and 47 cents per share with an average view of 45 cents per share, according to Reuters Estimates.
Kellogg, whose ose 12 percent in the fourth quarter, but only 5 percent when currency and the extra week are factored out.
The company earlier this month introduced a new kids' cereal called Tiger Power (search), which is made from whole grains. The move comes as Kellogg and other major food companies are scrambling to introduce products aimed at increasingly health-conscious consumers and are defending their right to advertise their products to children.
International sales rose 12 percent, but only 2 percent excluding the benefit of the weak dollar and the extra week, as the company repurchased inventory in Latin America.
Kellogg also backed its 2005 earnings forecast of $2.28 to $2.32 a share. Analysts on average forecast $2.37.
During the quarter, Kellogg named board member James Jenness as chairman and chief executive, replacing Carlos Gutierrez (search) who stepped down to become the next U.S. commerce secretary.
Kellogg shares fell 55 cents, or 1.2 percent, to $44.74 Monday on the New York Stock Exchange (search).
Get all the stories you need-to-know from the most powerful name in news delivered first thing every morning to your inbox