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  • KelloggCompany

    Page1 of11

    May5,2016

    KelloggCompany2016FIRSTQUARTERFINANCIALRESULTS

    May5,2016

    ForwardLookingStatements

    2

    Thispresentationcontains,orincorporatesbyreference,forwardlookingstatementswithprojectionsconcerning,amongotherthings,theCompanysglobalgrowthandefficiencyprogram(ProjectK),theintegrationofacquiredbusinesses,theCompanysstrategy,zerobasedbudgeting,andtheCompanyssales,earnings,margin,operatingprofit,costsandexpenditures,interestexpense,taxrate,capitalexpenditure,dividends,cashflow,debtreduction,sharerepurchases,costs,charges,ratesofreturn,brandbuilding,ROIC,workingcapital,growth,newproducts,innovation,costreductionprojects,workforcereductions,savings,andcompetitivepressures.Forwardlookingstatementsincludepredictionsof futureresultsoractivitiesandmaycontainthewordsexpects,believes,should,will,anticipates,projects,estimates,implies,can,orwordsorphrasesofsimilarmeaning.

    TheCompanysactualresultsoractivitiesmaydiffermateriallyfromthesepredictions.TheCompanysfutureresultscouldalsobeaffectedbyavarietyoffactors,includingtheabilitytoimplementProjectKasplanned,whethertheexpectedamountofcostsassociatedwithProjectKwilldifferfromforecasts,whethertheCompanywillbeabletorealizetheanticipatedbenefitsfromProjectKintheamountsandtimesexpected,theabilitytorealizetheanticipatedbenefitsandsynergiesfromtheacquisitionsintheamountsandatthetimesexpected,theimpactofcompetitiveconditions;theeffectivenessofpricing,advertising,andpromotionalprograms;thesuccessofinnovation,renovationandnewproductintroductions;therecoverabilityofthecarryingvalueofgoodwillandotherintangibles;thesuccessofproductivityimprovementsandbusiness transitions;commodityandenergyprices;laborcosts;disruptionsorinefficienciesinsupplychain;theavailabilityofandinterestratesonshorttermandlongtermfinancing;actualmarketperformanceofbenefitplantrustinvestments;thelevelsofspendingonsystemsinitiatives,properties,business opportunities,integrationofacquiredbusinesses,andothergeneralandadministrativecosts;changesinconsumerbehaviorandpreferences; theeffectofU.S.andforeigneconomicconditionsonitemssuchasinterestrates,statutorytaxrates,currencyconversionandavailability;legal andregulatoryfactorsincludingchangesinfoodsafety,advertisingandlabelinglawsandregulations;theultimateimpactofproductrecalls;businessdisruptionorotherlossesfromwar,terroristactsorpoliticalunrest;andotheritems.

    Forwardlookingstatementsspeakonlyasofthedatetheyweremade,andtheCompanyundertakesnoobligationtoupdatethempublicly.

    NonGAAPFinancialMeasures.ThispresentationincludesnonGAAPfinancialmeasures. PleaserefertotheAppendicesforareconciliationofthesenonGAAPfinancialmeasurestothemostdirectlycomparableGAAPfinancialmeasures.ManagementbelievesthattheuseofsuchnonGAAPmeasuresassistsinvestorsinunderstandingtheunderlyingoperatingperformanceofthecompanyanditssegments.

    May5,2016 KELLOGGCOMPANY|Q12016EARNINGS

  • KelloggCompany

    Page2 of11

    May5,2016

    OverviewofFirstQuarter2016

    3

    *Onacurrencyneutralcomparablebasis

    May5,2016 KELLOGGCOMPANY|Q12016EARNINGS

    Operatingprofitandearningsexceededourexpectations

    GoodunderlyingperformanceandsharegainsinU.S.Cerealbusiness

    Netsales*performanceexpectedtoimproveastheyearprogresses

    Reported$

    ReportedGrowth

    CurrencyNeutralComparableGrowth*

    CurrencyNeutralComparableGrowth

    excl.VZ*

    NetSales $ 3,395 (4.5)% 6.6% (1.0)%

    OperatingProfit $ 438 14.0% 34.9% 1.7%

    FirstQuarter2016

    SummaryofFinancialResults

    4

    * PleaserefertoappendicesforreconciliationofnonGAAPmeasurestothemostdirectlycomparableGAAPmeasure.

    ($inmillions,exceptEPS)

    EarningsPerShare(Comparable*) $0.97(1)%

    May5,2016 KELLOGGCOMPANY|Q12016EARNINGS

    EarningsPerShare(CurrencyNeutralComparable*) $1.33+36%

  • KelloggCompany

    Page3 of11

    May5,2016

    NetSalesComponents

    5

    (yearoveryear,%change)FirstQuarter2016

    May5,2016 KELLOGGCOMPANY|Q12016EARNINGS

    Q12015 Volume Price/Mix ProjectK/ShipDayDiff.

    Acq./Div. Currency Q12016

    $3,556M

    +7.3%

    (4.5)%

    +0.4%

    $3,395M

    (0.7)%

    (11.7)%

    CurrencyNeutralComparableGrowth+6.6%,(1)%ex.VZ

    +0.2%

    CurrencyNeutralComparableGrossProfit*

    6

    * PleaserefertoappendicesforreconciliationofnonGAAPmeasurestothemostdirectlycomparableGAAPmeasure.

    FirstQuarter2016

    38.0%Margin*

    40.1%Margin*

    2015 2016

    FirstQuarter

    $1.5b$1.4b

    May5,2016 KELLOGGCOMPANY|Q12016EARNINGS

    + PricinginVenezuela

    Continuedinvestmentinfood

    Category/channelmix

    + Ontracktopostimprovementforyear

  • KelloggCompany

    Page4 of11

    May5,2016

    OperatingProfitPerformancebyRegion

    7

    ($inmillions,currencyneutralcomparableperformance,*yearoveryear%change)FirstQuarter2016

    NorthAmerica

    Europe

    LatinAmerica

    AsiaPacific

    $362

    $70

    $23

    $17

    8%

    329%

    (6)%

    NetinputdeflationandsavingsfromProjectKandzerobasedbudgeting

    Drivenbytimingofinvestmenttosupportcommercialprograms,offsetbysalesperformance

    Largelyduetoinvestmentincapabilitiesandtimingoftransactionalcurrencyimpact

    ReportedDollars

    CurrencyNeutralComparableGrowth*

    *PleaserefertoappendicesforreconciliationofnonGAAPmeasurestothemostdirectlycomparableGAAPmeasure.

    1%

    DrivenbypricinginVenezuela

    May5,2016 KELLOGGCOMPANY|Q12016EARNINGS

    OperatingCashFlow(aftercapitalexpenditure)*

    8

    * PleaserefertoappendicesforreconciliationofnonGAAPmeasurestothemostdirectlycomparableGAAPmeasure.

    Firstquartercashflowof$(139)million

    Included$145millionassociatedwithabondtenderinthequarter

    Resultsinlinewithexpectationsandontracktodeliver$1.1billionforthefullyear

    FirstQuarter2016(millions)

    May5,2016 KELLOGGCOMPANY|Q12016EARNINGS

  • KelloggCompany

    Page5 of11

    May5,2016

    CoreWorkingCapital(a)

    9

    (12monthrolling,asapercentageofsales)

    (a) InternalKelloggMetric:Periodending.Last12monthsaveragetradereceivablesandinventory,less12monthsaveragetradepayables,dividedbylast12monthssales.

    7.6%7.3%

    6.8%6.4% 6.2%

    5.6%

    4Q2014 1Q2015 2Q2015 3Q2015 4Q2015 1Q2016

    May5,2016 KELLOGGCOMPANY|Q12016EARNINGS

    2016Outlook Guidance

    10

    (a) 2016guidanceexcludestheimpactofcurrencytranslation,differencesinthenumberofshippingdays,marktomarketadjustments,integrationcosts,costsrelatedtoProjectK,Venezuelaremeasurement,VIEdeconsolidation,andotheritemsthatcouldaffectcomparability.DoesincludetheimpactofprioracquisitionsandinvestmentinJVs.

    May5,2016 KELLOGGCOMPANY|Q12016EARNINGS

    GuidanceFromQ42015Call

    CurrentGuidanceQ12016

    2015Reportedearningspershare $1.72 $1.72Itemsaffectingcomparability 1.81 1.81

    2015Comparableearningspershare(EPS) $3.53 $3.53

    EPSgrowth(+68%) EPSgrowth(+1315%)Currencyneutralcomparable2016EPS (a) $3.74$3.81 $4.00$4.07

    Estimateforimpactofcurrency,ex.VZ (0.06) (0.06)(0.04) (0.30)

    Totalimpactofcurrency (0.10) (0.36)

    Comparable2016EPS $3.64$3.71 $3.64$3.71

    Integrationcosts $(0.02)(0.03) $(0.02)(0.03)Upfrontcosts $(0.40)(0.50) $(0.40)(0.50)

    EstimateforimpactofVZcurrency

  • KelloggCompany

    Page6 of11

    May5,2016

    2016Outlook

    11

    EPS(b)CurrencyNeutralComparable

    OperatingProfit(a)CurrencyNeutralComparable

    NetSales(a)CurrencyNeutralComparable

    +46%

    +1113%

    $4.00to$4.07

    (a) 2016guidanceexcludestheimpactofacquisitions,dispositions,currencytranslation,differencesinthenumberofshippingdays, marktomarketadjustments,integrationcosts,costsrelatedtoProjectK,Venezuelaremeasurement,VIEdeconsolidation,andotheritemsthatcouldaffectcomparability.

    (b) 2016guidanceexcludestheimpactofcurrencytranslation,differencesinthenumberofshippingdays,marktomarketadjustments,integrationcosts,costsrelatedtoProject K,Venezuelaremeasurement,andotheritemsthatcouldaffectcomparability.DoesincludetheimpactofprioracquisitionsandinvestmentinJVs.

    May5,2016 KELLOGGCOMPANY|Q12016EARNINGS

    Ex.Venezuela Incl.Venezuela

    +02%

    +46%

    Introduction NorthAmerica

    12May5,2016 KELLOGGCOMPANY|Q12016EARNINGS

    ReturntoProfitableGrowth

    AcceleratemomentumbehindadvantagedbrandsinCereal,Snacks,andFrozen

    TransformVeggieandunlockthefullpotentialofKashiCompany

    Expandmargins(whileinvestingtogrow)ProjectKandZBB

  • KelloggCompany

    Page7 of11

    May5,2016

    U.S.MorningFoods

    13May5,2016 KELLOGGCOMPANY|Q12016EARNINGS

    FirstQuarter2016

    Kellogg Core Six Brands and Overall Portfolio Driving Share Growth

    YearOverYearDollarShareChange(a)

    0.5% 0.5%

    0.2% 0.2%

    FY2015

    KelloggsBrand(c)KelloggsCoreSix(b)

    (a)ACNielsenScantrack,xAOC,weekending04/02/2016;(b)Core6=SpecialK,FMW,RaisinBran,FrostedFlakes,FootLoops,RiceKrispies;(c)Kelloggexcl.Kashi

    Q12016

    U.S.Snacks

    14May5,2016 KELLOGGCOMPANY|Q12016EARNINGS

    FirstQuarter2016

    GoodgrowthinBigThreeCrackerbrands

    ContinuedgoodperformancefromPringles

    Expect sequentialimprovementinsalesacrossthebalanceoftheyear

  • KelloggCompany

    Page8 of11

    May5,2016

    U.S.Specialty

    15

    SharegainsintheConveniencechannel

    K12andonthegogrowthinFoodservice

    Distributiongains inVending

    May5,2016 KELLOGGCOMPANY|Q12016EARNINGS

    FirstQuarter2016

    NorthAmericaOther

    16

    GreatnewinnovationlaunchinginFrozenFood

    PerformanceofKashicerealimprovedandgreatinnovationlaunching

    GrowthinCanadianCerealandWholesomeSnacksbusinesses

    May5,2016 KELLOGGCOMPANY|Q12016EARNINGS

    FirstQuarter2016

  • KelloggCompany

    Page9 of11

    May