Kellogg Co raised its full year sales and profit forecast on Thursday, buoyed by rising demand for its cornflakes and Froot Loops among consumers stuck at home due to the COVID-19 pandemic.
The Michigan-based company also beat second-quarter sales and profit estimates, sending its shares nearly 4% higher in premarket trading.
Work from home policies and closure of schools have led to a surge in demand for cereals, oatmeal and snacks in North America, with Kellogg‘s organic net sales in the region rising 11% in the second quarter ended 27 June.
Net sales stayed roughly flat from a year ago at about $3.47 billion, due to the sale of Kellogg‘s Keebler cookie business last year.
Analysts had expected net sales of $3.30 billion, according to IBES data from Refinitiv. Organic net sales rose 9.2% in the quarter.
Excluding items, Kellogg earned $1.24 per share, beating analysts’ average estimate of 94 cents.
Net income attributable to the company climbed to $351 million, or $1.02 per share, from $286 million, or 84 cents per share, a year earlier.
The company forecast full-year organic net sales to rise about 5%, ahead of a prior forecast of a 1% to 2% increase, and its adjusted earnings per share to fall about 1%, compared with previous outlook of a 3% to 4% fall.