Kellogg Co., cereal and snack maker, said Monday that its third-quarter earnings increased rose 9 percent, but warned that 2008 earnings will not meet Wall Street's expectations.
The world's leading cereal producer earned $305 million (EUR212 million), or 76 cents per share, in the July-September period, up from $281 million, or 70 cents per share, a year earlier.
The company's performance beat the average estimate of analysts polled by Thomson Financial by 3 cents per share.
Kellogg reported sales of $3 billion in the latest quarter, up 6 percent from $2.8 billion a year ago.
For the first nine months of 2007, the company reported net earnings of $927 million (EUR644.15 million), or $2.31 per share, up from $822 million, or $2.06 per share, a year ago. Nine-month sales rose to $9 billion from $8.3 billion a year ago.
"We achieved our goals by remaining focused on our game plan," David Mackay, Kellogg's chief executive, said in a statement. "We continue to lay the groundwork for future growth and reinvest into the business.
"Our third-quarter advertising investment rose at a double-digit rate and we're planning another increase in the fourth quarter. This investment gives us the confidence to once again raise our 2007 earnings guidance."
The company raised its full-year guidance by a penny, to a range of $2.72-$2.75 per share. But the guidance is still below the $2.77 per share, on average, forecast by analysts.
Kellogg also gave preliminary guidance for 2008 of $2.92 to $2.97 per share, less than the average of $3.04 that analysts predict.
In addition to cereals like Apple Jacks and Special K, Battle Creek-based Kellogg is a top maker of snacks and convenience foods. Its brands include Pop-Tarts toaster pastries, Eggo frozen waffles and Keebler cookies and crackers.
Its shares fell $1.94 to $52.50 in morning trading.
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