Corn Flakes and Rice Krispies maker Kellogg Co (NYSE:K) reported better-than-expected quarterly net revenue as higher sales in Latin America made up for lower demand for its cereals and snacks in the United States and the impact of a strong dollar.
Latin America net sales rose 2.5 percent to $328 million. Excluding forex, adjusted sales in the region rose 14.5 percent.
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The strong dollar eats into the value of Kellogg's international revenue at a time when U.S. sales are hit by a growing preference for less processed foods and cooked meals.
Sales in Kellogg's U.S. morning foods business, which includes cereal, fell 2.2 percent to $742 million, while the U.S. snacks business fell 2 percent to $835 million.
Net sales in Asia Pacific fell 5.6 percent to $234 million. Excluding the currency impact, adjusted net sales were up 6.8 percent in the region.
Kellogg gets about a third of its revenue from outside North America.
The dollar had risen 19 percent against a basket of major currencies in the 12 months to June.
Net income attributable to Kellogg fell to $223 million, or 63 cents per share, in the second quarter ended July 4, from $295 million, or 82 cents per share, a year earlier.
Excluding items, the company earned 92 cents per share.
Net sales fell 5.1 percent to $3.5 billion. Sales have grown only once in the last eight quarters.
Analysts on average had expected earnings of 92 cents per share on revenue of $3.47 billion, according to Thomson Reuters I/B/E/S.
Up to Monday's close, the company's shares had risen 7.5 percent in the past 12 months. (Reporting by Sruthi Ramakrishnan in Bengaluru; Editing by Saumyadeb Chakrabarty and Don Sebastian)