Kellogg Co. will continue to invest in its plant-based proteins because of how much they have sold while people have been in coronavirus quarantine.
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In its second-quarter earnings call, CEO, president and chairman of Kellogg Steve Cahillane said that Kellogg’s MorningStar Farms plant-based protein brand grew consumption by more than 31 percent in the quarter. The brand could not keep up with the frozen veggie foods category as it ramped up against capacity.
"Both of these categories are seeing increased household penetration," Cahillane said. "So, even as at home demand inevitably decelerates, we see an opportunity to increase our communication to take advantage of the increased household penetration, indeed in the second half second half we will be investing in this communication as well as in the launch of Incogmeato."
In Kellogg's general annual meeting in April, Callihane said the company has the right to win in the segment of plant-based foods and that he expected strong continued growth from the frozen side of MorningStar Farms this year.
As the frozen veggie department continued to perform well, Kellogg will launch Incogmeato, a sub-line of MorningStar Farms, which will expand its presence into the refrigerated segment.
As more people eat at home, Kellogg Co. is tapping into shifting consumer habits. More consumers are looking for new and exciting brands with an emphasis on health-conscious products and cleaner labels, and Kellogg is pushing to stay relevant as reflected by its portfolio investments and upcoming product launches.
Cahillane underscored the company’s heightened role in the global pandemic as people’s lives and day-to-day activities are drastically changed.
Even though people are less mobile and staying at home compared with April and March, Callihane said that Kellogg will continue to connect with people as it introduces new portfolio items like Incogmeato.
"That's what it's going to be about," Callihane said. "So, it's digital, it's social, it's traditional, all guided by ROIs and with very attractive categories."
Upon the announcement that its health and wellness-oriented brands is gaining shares, Kellogg will continue to invest in the plant-based portion of its portfolio.
The company frozen food business also grew with an increase in sales of its iconic Eggo Waffles with consumption growth of about 26 percent in North America during the quarter.
Kellogg reported quarterly earnings of $1.24 per share, ahead of analyst expectations which projected an estimate of 93 cents by 33 percent. The company also beat its quarterly sales predictions with a reported $3.47 billion, 5 percent up from an expected $3.30 billion.