morning, good everyone. and Steve, Thanks,
Let to assure me good the Amit, much will by with saying in start how of right I've very in time that my and direction. Kellogg And all enjoyed can with you're he in hands working and continue drive Kellogg I at you. you
are results: results Now to summarized our on number Our QX X. slide
basis. major sales price to margin the revitalize during in year-on-year QX input second as as would an a and to was largely year-on-year half/second a we be its until a price gradually where on XXXX little cost according ahead the said of timing this costs. be tougher the in because of mix-related we half. first organic would We items in had returning of in comparisons half, year-on-year as year-over-year, investment growth half, noted margins Operating actions ahead of input disparity anniversaries during though We would in further below-the-line comparisons adding and Go Let's realization organic negative profit sustain out. for first our format will was it that part EPS delayed. second be during operating the QX. expectations, first we half first profit comes And some grew said contributes our It script. organic right to would growth EPS. including particularly of out half. because discussed and the actually as net we to difficult brands, said the remain much Multipro kick it indicated and the result momentum, on and of because This improves the decreases On growth tax effectively corrective was fact Net expectations The declined played in our owing half, rate said EPS we down how that sales play recall the came out in that half. would we higher previously. first we to of the second gross improve
a net year. came income well payments flow timing within down with of the cash Our the as tax lower and expenditures capital as
important QX in than gave on these track cash year higher that guidance And for seasonally right February. However, us cash and the first note we put a back for it's Overall, results is in came light QX flow. expected. full we flow quarter in to half
Let's go bit a more little into detail.
you from Let's into the and of start consolidation anniversary at Obviously, the came in currency Multipro growth a know, with net by translation portion year in growth. contributing of net will sales this top and strong QX. was P&L year-on-year. of May XX. Dollar, in of the This strengthening dollar growth net our early Multipro's strengthened our sales as particularly organic further sales start QX offset a in will good results. our reported to even due number adverse slide much last to began in QX A
we sales on owing mainly was to Volume to down Importantly, slightly basis. in returned year-on-year, an net Cereal. shipment organic U.S. timing growth
result since been RX Our modest QX. growth management been in we've would it inventory not the related KNA's a higher realization QX of price price were late mix, positive if as posted trade of the revenue positive mix have region recall. turned taking actions Every price for write-offs and to
on you be because and can trade which these see, this. confirm inventory both decrease, slower are the QX-specific steady trends back both recall cereal And growth. the road of organic our to should So the RXBAR events, of we clearly start events, consumption
our to slide margin gross XX. turn on profit number let's Now
margin declined gross our expected, As year-on-year.
of Let's using three this been pressure. margin look at each to buckets we've the explain
the of in consolidating ago XXX About quarter. simply was year mechanical. is our first points The impact in of decline Multipro, mechanical the this was which basis P&L not
smaller more we which We is have Multipro impact growth after this month related. mix-related call will bucket April, of impact. one will what a The in mechanical much have next
quarters, North along sizable recent for Go led recall us. in cost this was an most is resulted negative acceleration products. related to single pack which that And towards was recall, aggressive these growth in quarters, American now extra formats snacks pursuing of serve impact even demand QX strategy in was On our markets costs categories. in One to Go about and towards SKUs, and this redeployment, the the We've an the As recent increase impact the this you'll co-packing and behind of mix the On emerging our in of for year-over-year. related driver talked RXBAR of repacking. shift bucket notably our in But and with
expect steps the final The revenue progresses. and packing big this management. bucket volume less growth the second don't as in half. we the repatriating and such impact The good SKU ongoing. impact news as what was the less is is in expected, call year as QX see to that and kick impact we co-pack taken until But centralized have rationalization mitigate some resolves as and such We to centers
this the As negative discussed input comparisons cost last year. with previously, we've inflation this turned and because quarter of
confident and our we in commodities While less input were will many to exchange-traded edges recent rolled half. half; have ongoing have very by experiencing easier also and news as a goes driven positive fuel over largely last on. this impact inflation margins we get faced of on the in which our implemented margin of non-exchange-traded sideways many be remain which In we're in negative in inputs. various accelerated is year months, QX, will moved have the On-the-Go as from favorable as the quarter actions, toughest not rate our when of growth was quarter efforts less management all comparisons -- and And comparison revenue second which for it The spoke ago in that This in one year, back our remember the was February. year anticipated COGS the items in costs gross larger we to the restore will year you grows QX; good that, inflationary. was second during
As we profit. remember drivers some it's way the important operating EPS, below to make to of our
number Some remind XX and there'll slide in to of headwind these was tax for you us that headwinds are be selected shown The earnings biggest the year. on rate.
with in of Our approximately full year effective in came tax guidance XX%. QX at line our XX.X%, right in
the in a the was drag significant year benefit did because year QX, not stakes yet another of a earlier comparison headwind We'll sizable face for growth EPS have on ago in year-on-year expense this million QX. for was discrete quarter, ago additional a the Interest because the discrete borrowings in benefit quarter example, year However, as forewarned. we -- Nigeria. $X had year-on-year a in against
continue the financial impact although higher be investment, Going somewhat increase moderates of that to year-on-year the in on the with Nigerian This year-on-year we year. is expense income pension rates interest as had as asset forward, we a down the sharply markets expense this indicated higher. December. of are declined will interest last all rates because lap a Other base and pension drag
the the our Before to we of year, guidance only discuss divestiture. it's into get changing element important our our that's pending guidance for
number making So selling. by We'll clear let's are begin we is XX. to what slide go sure on everyone
we Keebler a XXXX. the fruit transaction We're While was small crusts cones that selling selling and brands, acquisition the that other collectively entire business brand we the plus not acquired of amongst ice pie are in snacks. cream selling portion in which cookies, are we
expenses. about larger We are not close to divesting, that is we net and of Keebler million $XX $XXX business which are indirect of more selling profit crackers. portion they the we've To the including million that previously operating the profitable disclosed you sales an generated acquisition give all XXXX of size of in idea
employees these of to very Steve pleased are talented caliber. As we're Ferrero's going the great brands company and a mentioned, that
Now reviews the we April number when sell of and financial agreement had the in about the we impact near-term divestiture. XX the businesses. disclosed talk let's we financial to details implications Slide this early announced these
out to We we'll proceeds are a $X.X Of million this will in net anticipating the believe know will July. is of to plan all debt. billion in close more and somewhere price, billion. of be flexibility. of details pay after-tax $X enhance disclosed And our coming it worked the be financial and all we between the our was This use $XXX back April. down end And sales transaction There's months. of the at the still to obviously still
turn full our So in year now guidance XX. number slide to let's
As that no are few right ago, guidance gave the we pre-divestiture for we've we our so track months guidance. mentioned, to on a change
it's of X you our provided information track. remains this have number close divestiture While you the models many we end slide the your divestiture transaction making won't estimated on Everything XX. divestiture to on April adjusted bit of no earnings for shown can we that the We impact change already little We're impact give a July, divested today. using until and on announcements. this detail more on on
this be guided. each of by the our be profit by Let's QX seem of not would to trim expected divested while operating divestiture that months. months any from guidance. which month the be stay But This outlook true having at would related means brands, profit metric call of divestiture for to visibility on very absence end which It's costs these we been net a to the the brands' organic the to X%. excludes this But due the is and business early to may QX. over date. businesses it's we growth, transition more is Pre-divestiture from the operating XXXX. our is divestiture XX% the posted let's closes should with divestiture Pre-divestiture owners as cash business to least to Pre-divestiture to upfront to like four invested divestiture. that five currency-neutral the to summarized definition, indirect have transaction, up sales, impact take in transaction to expected too five reduce divestiture will our can of impacts X.X% This and may currency-neutral previously longer-term impact than are on impacts this. turn But the realignment There three guidance. or much profit Longer the points term, the months. growth decline period for remember required with the X% the And capital. new flow. has relative previous July, last assuming These the less the have on as brands' number the shared this bring expected EPS of but after divestiture return adjusted expected should next is the to five better the X% us losing during any review impact implications in you you large to depend sales keep dilutive for so our long-term to divestiture flat It of impact something And and depending adjusted be our divested on Organic XX. certainly change few improve for on two on currency-neutral XX%. net before reduce points organic the is to the the positive EPS which net X% growth X% expenses to closure the sales slide gain impact. no of ourselves. them down -- transition as a this we'll slight at we per outlook
efficiencies. businesses much generated them margin of average, categories that supply our and are adds also complexity as chain. invest. divestiture them puts by recent to declined the collectively resourced many reduce our portfolio Similarly, these offering to this in with finally, years. profile. proceeds our better our better And of opportunities not to other our we enhance We in a brands. position for than flexibility. these opportunities because growth benefit brands businesses have portfolio financial also on us higher-return Firstly, can profitable take most our to can and adds resources margins underlying our using down focus advantage lower simplifying pay of our and profile. been biggest have can as This a There's We Divesting divesting debt, to and
feel the we price and are -- line So in making On of leading to to drag long-term taking cost our price out transaction. formats generate steps starting biggest on way. U.S. We're pack our the needed our Go our inflation the mitigate to from position of very the margin We're and offset brands QX. top growth markets the realization emerging there're about with benefits coming clear good this making summary, we some In financial progress good
Our and track QX plan. our on year dilution right original pre-divestiture towards puts full guidance, half both there's We're from guidance, new And nothing on first for the and the the us strategy our to on expected to year. full the for divestiture. nor
the will turn that, regions. with to who I'll discuss performance So, Steve of it back our each of
