Kellogg Co. (K) announced on Wednesday that it is progressing as planned with its separation into two publicly traded companies in the fourth quarter. In their statement released ahead of an investor day, the company revealed that its North American cereals business will merge with the new WK Kellogg Co., which will be traded under the ticker symbol ‘KLG.’ The remaining business will be consolidated into a new company called Kellanova, which will continue trading under the current ticker symbol ‘K.’
Overview of Kellanova
Kellanova is projected to generate sales of approximately $13.4 billion to $13.6 billion by 2024, along with adjusted per-share earnings ranging from $3.55 to $3.65. The company’s strategic focus will predominantly be on snacking, boasting a global presence and a significant market share in rapidly growing emerging economies. In 2022, roughly 60% of Kellanova’s sales were derived from popular snack brands such as Pringles, Cheez-It, Pop-Tarts, Rice Krispies Treats, and others. Meanwhile, international cereal products accounted for around 20% of their sales, and noodles and other food items comprised just over 10%. Frozen foods constituted the remaining portion, contributing just under 10%.
WK Kellogg’s Outlook
On the other hand, WK Kellogg is expected to generate sales amounting to $2.7 billion by 2024.
Despite experiencing a slight increase in premarket trading, Kellogg Co.’s stock has declined by 11% year-to-date, while the S&P 500 has enjoyed a 17% gain.