Citing lower cereal sales and recall repercussions, Kellogg (NYSE:K) on Thursday cut its fiscal 2010 view.
The full-year results are expected to be impeded by a weaker third-quarter, including an anticipated 4% decline in sales.
Profit for that quarter may fall 5%, with earnings per share down 4%, the Battle Creek, Mich-based company said.
David Mackay, the cereal maker’s chief executive, said the company is “disappointed” with its third-quarter results.
Based on the slower demand, Kellogg said Internet sales for the full-year are expected to fall 1% with internal operating profit virtually flat, including the benefit of lower incentive compensation costs.
Mackay called the fiscal year “challenging,” citing weaker performance in some of the company’s core cereal markets, competitive intensity and lingering impact of the cereal recall.
About four months ago, Kellogg recalled its Apple Jacks, Corn Pops, Froot Loops and Honey Smacks cereals due to an uncharacteristic off-flavor and smell coming from the package’s liner.
Fiscal 2010 currency-neutral earnings per share are expected to grow in the range of 4% to 5%.
Kellogg will release actual third-quarter results on Nov. 2.