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Nearly a year after it was spun off as a standalone cereal business, WK Kellogg Co. is successfully pursuing its mission to gain market share in the breakfast category..
Nine of WK Kellogg's 11 largest brands are growing faster than the cereal category as a whole, CEO Gary Pilnick told investors last week at the company's annual Barclays conference. Philnic WK Kellogg Co said its understanding of its business is now much stronger than before. Spin-offBecause you can focus on just one product area within your supply chain.
“Now that all we do is cereal, the speed at which we can go from idea to shelf to pantry is seamless,” Pilnick said.
The CEO said the company was able to focus on cereal-related issues, thanks to a reduction in its workforce of 38,000 under the larger Kellogg umbrella to 3,000 at dedicated ready-to-eat cereal plants. Pilnick said recent investments in its supply chain will help it meet demand for its products across a range of price points and packaging locations.
“We’re going to leapfrog what we can do today to what we can do tomorrow, and that’s going to be a meaningful difference with new platforms,” Pilnick said. “We’re going to move away from aging technologies and adopt new technologies. That’s going to give us the flexibility to do not just our current foods, but also other foods.”
According to Pilnick, WK Kellogg Co believes there are “many” ways to grow the business going forward, including focusing on e-commerce and new packaging formats for its products.
When asked about WK Kellogg Co’s innovation pipeline, the CEO noted that while new innovations across the cereal category were underperforming in 2024, established brands like Frosted Flakes were thriving. He believes the company’s new cereal products, which it plans to launch next year, will allow it to fully demonstrate its strengths as a standalone business for the first time.
“2025 is the first innovation set that WK Kellogg has ever created, because 2024 would have been created before Spin. We’re building this now as a team,” Pilnick said. “What you can expect from the innovation set is a balance across the portfolio, across wellness, across flavor, across the brands.”
Earlier this year, WK Kellogg launched Eat Your Mouth Off, a healthy cereal brand aimed at Gen Z that contains no sugar and is sweetened with stevia.
The CEO's positive outlook follows the company's disappointing earnings report last month, which showed sales down 2.7% from a year earlier. In August, the company announced plans to close its Omaha, Nebraska, plant and scale back production at its Memphis, Tennessee, plant by 2025, cutting 550 jobs. WK Kellogg Co. plans to shift production to other cereal plants.
