Corn Flakes and Rice Krispies maker Kellogg's has pushed up its 2016 profit forecast after saving more than expected from its cost cutting measures.
In 2013 Kellogg laid out plans to save $475m annually by 2018 by cutting jobs and production costs.
Kellogg’s sales costs fell 11.5 per cent to $2bn in the second quarter, though net sales also fell, down 6.6 per cent to $3.27bn, making this Kellogg’s sixth straight quarterly sales slide.
Consumers are increasingly choosing fresh produce over processed food due to perceived health benefits.
Kellogg's raised its adjusted profit forecast for the year to between $4.11 and $4.18 per share from between $4.00 and $4.07 previously.
“We’re making good progress on our priorities: We have continued to improve our foods to insure they are on trend; we’ve continued to expand the Pringles business worldwide; we’re enhancing our sales capabilities; and we are designing and executing productivity initiatives that are contributing to more profit-margin expansion than we previously anticipated,” said John Bryant, Kellogg's chief executive.
Kellogg’s rivals General Mills and ConAgra Foods have recorded similar falls in sales in recent years.