Reportable Segments

3 Months Ended

Apr. 04, 2015

Reportable Segments [Abstract]

Reportable Segments [Text Block]

Note 12Reportable segments

Kellogg Company is the world's leading producer of cereal, second largest producer of cookies and crackers, and a leading producer of savory snacks and frozen foods. Additional product offerings include toaster pastries, cereal bars, fruit-flavored snacks and veggie foods. Kellogg products are manufactured and marketed globally. Principal markets for these products include the United States and United Kingdom.

The Company has the following reportable segments: U.S. Morning Foods; U.S. Snacks; U.S. Specialty; North America Other; Europe; Latin America; and Asia Pacific.  Beginning in the first quarter of 2015, a new Kashi operating segment was established in order to optimize future growth potential of this business. This operating segment is included in the North America Other reportable segment. Previously, results of Kashi were included within the U.S. Morning Foods, U.S. Snacks, and the U.S. Frozen operating segments. Goodwill was reallocated between operating segments on a relative fair value basis. In conjunction with the reallocation of goodwill, an impairment analysis was performed. No impairment of the operating segments was noted. Reportable segment results of prior periods have been recast to conform to the current presentation.

The Company manages its operations through nine operating segments that are based on product category or geographic location. These operating segments are evaluated for similarity with regards to economic characteristics, products, production processes, types or classes of customers, distribution methods and regulatory environments to determine if they can be aggregated into reportable segments. 

The reportable segments are discussed in greater detail below.

U.S. Morning Foods includes cereal, toaster pastries, health and wellness bars, and beverages.

U.S. Snacks includes cookies, crackers, cereal bars, savory snacks and fruit-flavored snacks.

U.S. Specialty primarily represents food away from home channels, includingfood service, convenience, vending, Girl Scouts and food manufacturing. The food service business is mostly non-commercial, serving institutions such as schools and hospitals. The convenience business includes traditional convenience stores as well as alternate retail outlets.

North America Other includes the U.S. Frozen, Kashi and Canada operating segments.  As these operating segments are not considered economically similar enough to aggregate with other operating segments and are immaterial for separate disclosure, they have been grouped together as a single reportable segment.

The three remaining reportable segments are based on geographic location – Europe which consists principally of European countries;Latin America which consists of Central and South America and includes Mexico; and Asia Pacific which consists of South Africa, Australia and other Asian and Pacific markets.

The measurement of reportable segment results is based on segment operating profit which is generally consistent with the presentation of operating profit in the Consolidated Statement of Income. Intercompany transactions between operating segments were insignificant in all periods presented.

			Quarter ended
			April 4,		March 29,
(millions)			2015		2014
Net sales
	U.S. Morning Foods	$	776	$	799
	U.S. Snacks		854		864
	U.S. Specialty		361		372
	North America Other		433		482
	Europe		607		705
	Latin America		295		278
	Asia Pacific		230		242
	Consolidated	$	3,556	$	3,742
Operating profit
	U.S. Morning Foods	$	127	$	126
	U.S. Snacks		80		86
	U.S. Specialty		78		87
	North America Other		59		83
	Europe		61		65
	Latin America		51		48
	Asia Pacific		12		16
	Total Reportable Segments		468		511
	Corporate (a)		(84)		103
	Consolidated	$	384	$	614
(a)	Includes mark-to-market adjustments for pension plans and commodity contracts totaling $(67) million and $116 million for the quarters ended April 4, 2015 and March 29, 2014, respectively.