Core Insights - WK Kellogg Co. reported a decline in both top and bottom lines for Q3 2024, with shares dropping 8.1% post-results, although both metrics exceeded Zacks Consensus Estimates [1][2] Financial Performance - Adjusted earnings per share were 31 cents, surpassing the Zacks Consensus Estimate of 26 cents, but down from 33 cents in the same quarter last year [1] - Net sales reached $689 million, exceeding the Zacks Consensus Estimate of $674 million, but reflecting a 0.4% year-over-year decline [2] - Price/mix increased by 1.8%, while volume decreased by 1.1% in the third quarter [2] Profitability Metrics - Adjusted gross profit was $203 million, up from $193 million year-over-year, with adjusted gross margin expanding by 150 basis points to 29.4% [3] - Adjusted EBITDA was $65 million, an 18.2% increase year-over-year, attributed to stronger top-line performance and operational discipline, with an adjusted EBITDA margin increase of 150 basis points to 9.5% [4] Cost Management - Selling, general and administrative expenses were $162 million, down 9.5% from $179 million in the prior year, representing 23.5% of sales, a decrease of 240 basis points [5] Financial Position - As of the end of the quarter, the company had cash and cash equivalents of $47 million, long-term debt of $472 million, and total equity of $316 million [6] - Cash generated from operating activities for the year-to-date period was $98 million [6] Future Guidance - WK Kellogg reiterated its full-year adjusted net sales growth guidance, projecting a decline of 1% to growth of 1%, while upgrading adjusted EBITDA growth expectations to 5% to 6% from a previous range of 3% to 5% [8] - Adjusted EBITDA is expected to be between $271 million and $273 million [8] Interest and Depreciation - Interest expenses are anticipated to be between $30 million and $35 million for the year, with depreciation and amortization expenses expected to be in the range of $75 million to $80 million [9]

WK Kellogg Co (KLG Q3 2024 Results Conference Call November 7, 2024 9:30 AM ET Company Participants Karen Duke - Vice President, Finance and IR Gary Pilnick - Chairman and CEO Dave McKinstray - Chief Financial Officer Conference Call Participants Kenneth Goldman - JPMorgan Peter Galbo - Bank of America Andrew Lazar - Barclays David Palmer - Evercore ISI Max Gumport - BNP Paribas Robert Moskow - TD Cowen Rob Dickerson - Jefferies Operator Good morning. Thank you for attending today's WK Kellogg Co Q3 Earning ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 28, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-41755 Delaware 92-1243173 (State or other jurisdiction of incorporation or organization) (IRS Employer Ide ...

Financial Performance - Reported net sales for Q3 2024 were $689 million, a 0.4% decline year-over-year[2]. - Adjusted net sales increased 0.7% year-over-year compared to standalone adjusted net sales[2]. - Reported net income for Q3 2024 was a loss of $11 million, a 126.2% decrease year-over-year[7]. - Adjusted EBITDA for Q3 2024 was $65 million, a 27.5% increase year-over-year compared to standalone adjusted EBITDA[7]. - Year-to-date reported net sales were $2,068 million, a 2.1% decline year-over-year[6]. - Year-to-date adjusted EBITDA was $217 million, a 5.3% increase year-over-year compared to standalone adjusted EBITDA[8]. - The company reaffirms 2024 adjusted net sales growth guidance at the lower end of the range, projected at (1.0)% to 1.0%[9]. - The company raises 2024 adjusted EBITDA growth guidance to a range of 5% to 6%, up from 3% to 5%[9]. Sales and Volume - Price/mix increased by 1.8% in Q3, while volume decreased by 1.1%[5]. - The company experienced a volume decline of 1.1% in tonnage for the quarter, while pricing/mix improved by 1.8%[44]. - Reported net sales for the quarter ended September 28, 2024, were $689 million, a decrease of 0.4% compared to $692 million for the same period in 2023[44]. - Year-to-date reported net sales were $2,068 million, down 2.1% from $2,112 million in the previous year[44]. Costs and Expenses - The cost of goods sold for the quarter was $495 million, slightly down from $496 million year-over-year[38]. - The company incurred restructuring costs of $38 million during the quarter[38]. - Free cash flow for the quarter was $2 million, a significant decrease from $91 million in the prior year[40]. - Cash and cash equivalents at the end of the period were $47 million, down from $89 million at the beginning of the period[42]. - The company incurred pre-tax mark-to-market losses of $3 million for the quarter ended September 28, 2024, and $5 million year-to-date[55]. - Separation costs related to the Spin-Off amounted to $6 million for the quarter and $22 million year-to-date as of September 28, 2024[56]. - Restructuring and non-recurring costs related to supply chain reconfiguration were $42 million for the quarter and $44 million year-to-date as of September 28, 2024[57]. - Other expense of $2 million was excluded from Adjusted EBITDA for the quarter ended September 28, 2024[58]. Assets and Liabilities - Total assets increased to $1.9 billion as of September 28, 2024, compared to $1.889 billion at the end of the previous year[42]. - Total current liabilities decreased to $770 million from $836 million at the end of the previous year[42]. - Long-term debt was reported at $472 million, down from $487 million at the end of the previous year[42]. - Net debt increased to $442 million as of September 28, 2024, compared to $410 million as of December 30, 2023[53]. Profitability Metrics - Adjusted gross profit for the quarter was $203 million, up from $193 million year-over-year, reflecting a strong adjusted gross margin of 29.4% compared to 27.9% in the prior year[45][46]. - Reported gross margin for the quarter was 28.1%, slightly down from 28.4% in the same quarter last year[46]. - Adjusted EPS for the quarter was $0.31, compared to $0.33 in the same quarter last year, reflecting a decrease of 6.1%[50]. - Standalone adjusted net income for the quarter was $27 million, representing an 8.0% increase from $25 million in the same quarter last year[47]. Historical Context - Historical intercompany sales and royalty agreements had a net sales impact of $8 million for the quarter ended September 30, 2023[59]. - Estimated standalone costs for the quarter ended September 30, 2023, were $6 million[60]. - The average number of diluted shares outstanding was 86 million for the quarter[36].

BATTLE CREEK, Mich., Nov. 7, 2024 /PRNewswire/ -- WK Kellogg Co (NYSE: KLG), today published its 2024 third quarter results in documents posted to the company website at https://investor.wkkellogg.com/news-events/events-and-presentations/default.aspx. Documents immediately available include: the financial press release and tables, GAAP reconciliations, and presentation slides. A Current Report on Form 8-K was furnished with the U.S. Securities and Exchange Commission and is available on its website at www.s ...

WK Kellogg Co (NYSE: KLG ) is a mid-cap stock that has caught my attention due to its attractive valuation and positioning in the consumer staples sector. As I have written about before on Seeking Alpha, I am anticipating aI am an investor with a passion for uncovering small and medium-sized companies here on Seeking Alpha. I'm also an ETF swing trader, uncovering opportunities via a blend of fundamental and technical analysis and theta-based option writing.Analyst’s Disclosure: I/we have no stock, option o ...

BATTLE CREEK, Mich., Oct. 16, 2024 /PRNewswire/ -- WK Kellogg Co (NYSE: KLG) announced today that it will host a conference call on Thursday, November 7, 2024, at 9:30 a.m. EDT, to discuss the company's financial results for the third quarter of 2024 and provide an operational update, including indications regarding the performance and outlook of the business. The conference call will be a live audio webcast available at investor.wkkellogg.com. At approximately 8:00 a.m. EDT on that day the company will rel ...

If WK Kellogg's management can deliver on its promise of higher margins, an investment today could outperform over the long run. Corporate spinoffs can be an odd investment proposition. Often, when companies split up, one of the resulting businesses seems like the "desirable" asset to own, while the other gets spurned by investors. Typically, that unloved company is the one that winds up with the parent's less exciting operations or the businesses with lower projected growth. Indeed, the performance gaps be ...

Financial Performance - Net sales for the quarter ended June 29, 2024, were $672 million, a decrease of 4% compared to $700 million for the same period in 2023[7]. - Operating profit increased to $47 million for the quarter ended June 29, 2024, compared to $28 million in the same quarter of 2023, representing a 68% increase[7]. - Net income for the quarter was $31 million, up from $27 million in the prior year, reflecting a 15% increase[9]. - Basic earnings per share for the quarter were $0.37, compared to $0.32 in the same quarter of 2023, marking a 16% increase[7]. - The company reported a year-to-date net income of $64 million for the period ended June 29, 2024, compared to $53 million for the same period in 2023, an increase of 21%[9]. - Comprehensive income for the quarter was $39 million, compared to $37 million in the same quarter of 2023, indicating a 5.4% increase[9]. - Net income for the quarter ended June 29, 2024, was $64 million, an increase from $53 million in the same quarter of 2023, representing a 20.8% growth[19]. - EBITDA for the quarter ended June 29, 2024, increased 40% to $70 million compared to $50 million in the prior year[91]. - Adjusted EBITDA decreased 12% for the quarter ended June 29, 2024, to $78 million compared to $89 million in the prior year[89]. - Reported gross profit for the quarter ended June 29, 2024, was $196 million, with a gross margin of 29.1%, an increase of 1.8 percentage points from the prior year[92]. Expenses and Costs - Selling, general and administrative expenses decreased to $149 million for the quarter ended June 29, 2024, down from $163 million in the same quarter of 2023, a reduction of 8.6%[7]. - Total net cash provided by operating activities decreased to $37 million from $140 million year-over-year, a decline of 73.6%[19]. - The company recorded a net loss on the sale of receivables of $5 million for the quarter ended June 29, 2024, compared to a loss of $4 million in the same quarter of 2023[34]. - The total pension expense for the quarter ended June 29, 2024, was $1 million, and for the year-to-date period, it was $2 million[41]. - The total postretirement benefit income for the quarter ended June 29, 2024, was $(10) million, and for the year-to-date period, it was $(20) million[42]. - The Company recorded operating lease costs of $4 million for the quarter and $7 million for the year-to-date period ended June 29, 2024[47]. - The Company incurred pre-tax charges of $2 million related to supply chain network reconfiguration for the quarter ended June 29, 2024[87]. - The company incurred pre-tax separation costs of $8 million for the quarter ended June 29, 2024, compared to $40 million for the same quarter in 2023, showing a significant reduction in costs[86]. Cash Flow and Liquidity - Cash and cash equivalents at the end of the period were $44 million, a decrease from $2 million at the end of the previous year[19]. - Free cash flow for the year-to-date period ended June 29, 2024, was $(10) million, a decrease from $80 million in the prior year[107]. - Net cash used in investing activities was $47 million for the year-to-date period ended June 29, 2024, compared to $56 million in the prior year[108]. - Net cash used in financing activities was $33 million for the year-to-date period ended June 29, 2024, down from $82 million in the prior year, primarily due to $27 million in dividend payments[109]. - As of June 29, 2024, borrowings under the Credit Facility were $490 million, with an additional $600 million of borrowing capacity available[101]. Market and Strategic Focus - The company is focused on expanding its market presence and enhancing product offerings through new strategies and technologies[7]. - The Company is focused on leveraging marketing expertise and product innovation to respond to a challenging retail environment characterized by consolidation among large U.S. retail customers[80]. - The Company plans to close its Omaha, Nebraska plant with full closure targeted by the end of 2026, as part of its strategic priority to modernize its supply chain[67]. - The Company expects cumulative restructuring pretax charges of between $230 million and $270 million due to the reorganization plan, including $30 million to $40 million in cash costs for severance and other termination benefits[68]. - The geopolitical instability, particularly the war in Ukraine and related sanctions, continues to create inflationary pressures on commodity costs, despite the company's lack of direct exposure to these regions[79]. - The company has implemented productivity initiatives and revenue growth management actions to offset input-cost inflation, demonstrating proactive financial management[78]. Equity and Dividends - The company declared dividends of $0.16 per share during the quarter, totaling $13 million[12]. - The Board of Directors declared a dividend of $0.16 per share, payable on September 14, 2024[109]. - The total equity as of June 29, 2024, was $336 million, up from $300 million at the end of December 30, 2023[12]. Derivative Instruments and Financial Instruments - The total notional amounts of the Company's derivative instruments as of June 29, 2024, were $328 million, including $251 million in foreign currency exchange contracts and $77 million in commodity contracts[56]. - The Company recognized a loss of $(1) million in cost of goods sold related to commodity contracts for the quarter ended June 29, 2024[59]. - The Company does not have any derivatives designated as hedging instruments, and the fair value of its financial assets and liabilities is measured on a recurring basis[58]. Inventory and Receivables - As of June 29, 2024, accounts receivable, net decreased to $217 million from $244 million as of December 30, 2023, reflecting a decline of approximately 11%[63]. - The Company’s inventories increased to $360 million as of June 29, 2024, compared to $345 million as of December 30, 2023, representing a rise of approximately 4%[63]. - Accounts receivable sold under monetization agreements amounted to $313 million as of June 29, 2024, compared to $266 million as of December 30, 2023[111].

| --- | --- | --- | --- | |-------------------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | | | | | | Q2 2024 EARNINGS | | | | | August 6, 2024 | | | | Forward-Looking Statements This presentation contains a number of forward-looking statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include predictions of future results or activities and may contain the words "expect," "believe," "will," "can, ...