Kelloggs Analysis

 Kelloggs Analysis Essay

Strategic Marketing

Inside Analysis Task

October 2010

Kellogg's is known as a food making company whose principal goods are ready-to-eat cereals and convenience food, such as cookies, crackers, best toaster oven pastries, cereal bars, fruit snacks, frosty waffles and veggie food. These products are manufactured in 18 countries and marketed in more than one hundred and eighty countries. The cereal items are generally sold under the Kellogg's name and therefore are sold primarily to the grocery trade through direct sales forces for reselling to customers. (Kellogg's, 2010)

In this record I will mainly be looking at Kellogg companies monetary reports for the last five years. I'll be analysing the tendencies survey predictions can be made the future. These predictions will allow the company to produce strategies approach bring the firm forward later on.

Net Revenue

Net revenue show the quantity of sales generated by company following the deductions of returns, allowances are destroyed or absent goods and any discount rates allowed. (Investopedia)

Year| 2005| 2006| 2007| 2008| 2009

Net Sales ($ Millions)| 10, 117, 000| 10, 907, 000| 11, 776, 000| doze, 822, 000| 12, 575, 000| (Kellogg's, 2010)

Kellogg Company has demonstrated steady growth in net sales through the year 2005 to 2008, reaching a top of just under $13 billion dollars. In 2009 monetary year the corporation suffered a slight dip, unfortunately he to be anticipated with the economic crisis. With the exception of this kind of slight drop, I would expect the growth of Kellogg Organization to carry on through the next economic year along a similar flight that was experienced between 2005 2008.

Operating profit

Operating profit or perhaps Earnings prior to Interest and Tax (EBIT) is the cash in on a firm's core business operations. It does not include benefit from a business's investment or maybe the effects of fascination and taxation. (Investopedia)

Year| 2005| 2006| 2007| 2008| 2009

Operating Profit (millions)| 1750| 1766| 1868| 1953| 2001| (Kellogg's, 2010)

This is why from the info Kellogg's business operating profit has skilled massive development over the last five years, elevating by above $250 mil. Whilst development slowed down in the year 2009, that still grew. Extrapolating another trend, I'd personally expect operating profit to stay growing in the same pattern towards the years 2006 to 2008.

Stock Turnover

Stock turnover is the measurement used to show the number of occasions stock is used or offered within the provided timeframe, in cases like this one year. A decreased turnover level might indicate overstocking, obsolescence or deficiencies in the product line or marketing strategy. [ (Investopedia) ]

Year| 2006| 2007| 2008| 2009

Share turnover| 13. 23| 12. 74| 18. 29| 13. 81

[ (Kellogg's, 2010) ]

Although the plan does present quite deviation stock turnover, I feel that this is certainly more because of how tightly we are looking at the figures in the picture. If you look at the table, you will see that inventory turnover variation isn't really that big in any way. Kellogg's have got a normal and fairly constant rate of turnover. By simply increasing their very own stock yield, Kellogg's will be reducing holding prices. By doing this they will embrace net revenue and earnings, as long as net income remains frequent. Return upon Invested Capital

A calculation employed toВ assess a company's efficiency at allocating the capital below its control to successful investments. The return upon invested capital measure provides sense of how well a firm is having a money to generate returns. (Investopedia)

Year| 2005| 2006| 2007| 2008| 2009

ROIC %| 15. 1%| 15. 4%| 16. 6%| 17. 8%| 19. 8%

(Kellogg's, 2010)

As you can see through the diagram, the ROIC has increased by four. 7% over the last 5 years. This means that the capital which has been committed to the firm is bringing back bigger and bigger results. This is a good indication for shareholders who will want to consider seeing healthy returns on the money.

Diluted Earnings per Share

Diluted earnings every...

Bibliography: Investopedia. (n. deb. ). Investopedia Net Revenue. Retrieved Oct 10, 2001, from investopedia. com:

Kellogg 's. (2010). Kelloggs Company 2009 Annual Record. Michigan: Kellogg Company.

Wiki Invest. (n. d. ). wikinvest. com. Retrieved August 12, 2010, from Wili Invest:



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