"Kellanov posted $0.88 in adjusted earnings per share against a $0.87 estimate, and revenue of $3.26 billion versus $3.25 billion expected. On the surface, clean wins. But look deeper and you see a company under stress. Net income fell 15.8% year over year. Gross profit contracted 7.89%. Operating income slipped 1.74% despite the company's efforts to manage costs. The revenue beat of roughly $9 million matters far less than the margin compression underneath."
"Adjusted operating profit rose 7.3%, a rare positive in a quarter marked by "prolonged category-wide softness and higher costs," as CEO Steve Cahillane described it. The noodles segment in Africa delivered significant growth, a rare bright spot in an otherwise sluggish business. Favorable currency translation also helped. These aren't trivial wins. They show the company found pockets of demand even as core snacking categories faced headwinds."
Kellanov reported a narrow Q4 beat with $0.88 adjusted EPS versus $0.87 and $3.26 billion revenue versus $3.25 billion. Net income fell 15.8% year over year, gross profit contracted 7.89%, and operating income slipped 1.74%, indicating margin compression despite the revenue beat. Operating cash flow surged 42.5% year over year to $788 million and free cash flow was $320 million, supporting dividend and debt capacity. Adjusted operating profit rose 7.3% with growth in the noodles segment in Africa and favorable currency translation. Revenue grew just 0.84%, and the pending Mars acquisition is keeping the stock near its deal price.
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