Kellogg’s Plans to Sell Cookie, Pie Crusts and Ice Cream Cones Businesses

Kellogg Company has shared an update on the actions and investments behind its Deploy for Growth strategy and has announced that it will focus its portfolio and resources further by exploring the potential sale of brands and assets related to its cookies, fruit-flavored snacks, pie crusts and ice cream cones businesses.

The company will also reorganize its North America Region division to provide better focus on individual categories, greater leverage of scale across sales, supply chain, and other functions, more holistic resource prioritization, and faster decision-making within a flatter organization.

For 2019 financial outlook, Kellogg’s forecasts that its organic net sales growth would continue to improve, while investments in brands and capabilities will be significant again, restraining currency-neutral adjusted operating profit growth.

“Deploy For Growth is providing us clarity on priorities and is resulting in deliberate actions and investments that are already producing improved results. We know that earnings growth cannot be sustainable without consistent top-line growth, and we are building a foundation for steady net sales growth well into the future.  We’re more confident today in our long-term outlook than we were when we launched Deploy For Growth early this year,” said Steve Cahillane, Kellogg’s chairman and CEO.

The announcement comes less than two weeks after Kellogg cut its full-year profit outlook, citing increased spending on advertising and higher distribution costs.

“We need to make strategic choices about our business and these brands have had difficulty competing for resources and investments within our portfolio,” Cahillane said in a statement.

The company has made recent acquisitions and investments in key consumer segments and in emerging markets, including Parati (Brazil), RX (U.S.), and Multipro (West Africa).

During the latest years, Kellogg’s has also developed its biscuit portfolio. For example, in 2015, the company acquired BiscoMisr, one of the most recognized baked goods companies in Egypt.

According to the research company Technavio, Kellogg’s was one of the biggest global vendors of cookies in 2017. Its portfolio includes brands such as Keebler, Famous Amos, Mother’s Cookies and Murray.