USA- Food manufacturing company WK Kellog has reported a 0.8% decline in adjusted net sales for Q1 2024. Top executives remain optimistic that the company will achieve its 2024 financial projections because of operational and supply chain efficiencies.
Net sales were down from US$720 million in Q1 2024 to US$707 million in Q1 2023, representing a net sales decline of 1.8%.
Adjusted net sales, however, declined 0.8%. The company predicts a net sales change of -1% and 1% from 2023.
The 0.8% net sales decline is not only in line with the company’s predictions but also marks a significant improvement from the Q4 2023 performance.
Net sales were down by 2.7% compared to Q4 2022, while sales volume declined by 10.1% during the same period.
The company’s net income was US$33 million in the first quarter of 2024, an increase of 38% from US$24 million in the first quarter of 2023.
The company reported a 6.3% positive price/mix, while sales volumes were down 7% during Q1 2024 compared to Q1 2023.
Overall, the company’s share price improved from US$0.28 in Q1 2023 to US$0.38 per share after the release of Q1 2024 reports.
The improved earnings and declining net sales result from its internal revenue growth management strategies and increasing levels of efficiencies in supply chain management.
The company’s strategy involves an integrated end-to-end cooperation between teams in the company’s operational structure.
The company’s chairman and CEO said, “We’ve started 2024 delivering first-quarter financial results in line with our expectations, and we are on track for the year.”
The CEO also attributed the improving volume trends to price elasticities in the market, especially after the company recouped its major price increase within this quarter.
The company also attributed the improved performance to the fast growth of products like Frosted Flakes, Raisin Bran, and Rice Krispies in the US.
Brands like Frosted Flakes also enjoyed a stable performance in Canada.
The report highlighted the importance of providing value to all stakeholders.
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