Reportable 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, veggie foods and noodles. Kellogg products are manufactured and marketed globally. Principal markets for these products include the United States and United Kingdom.

The Company manages its operations through ten 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.

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

U.S. Morning Foods includes primarily cereal and toaster pastries.

U.S. Specialty Channels primarily represents food away from home channels, including food 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 Foods, Kashi, Canada, and RX 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, the Middle east and Northern Africa; Latin America which consists of Central and South America and includes Mexico; and Asia Pacific which consists of Sub-Saharan 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. Certain immaterial reclassifications have been made to the prior year amounts to conform with current year presentation.



	Quarter ended						Year-to-date period ended
(millions)	September 29, 2018			September 30, 2017			September 29, 2018			September 30, 2017
Net sales
U.S. Snacks	$	737		$	764		$	2,244		$	2,374
U.S. Morning Foods	683			692			2,017			2,064
U.S. Specialty Channels	285			288			960			956
North America Other	483			419			1,424			1,201
Europe	596			599			1,804			1,679
Latin America	239			235			710			687
Asia Pacific	446			249			1,071			708
Consolidated	$	3,469		$	3,246		$	10,230		$	9,669
Operating profit
U.S. Snacks	$	119		$	13		$	332		$	6
U.S. Morning Foods	112			132			400			459
U.S. Specialty Channels	62			76			202			242
North America Other	37			65			180			173
Europe	74			71			245			214
Latin America	28			23			70			82
Asia Pacific	35			24			90			64
Total Reportable Segments	467			404			1,519			1,240
Corporate	(71		)	(71		)	(139		)	(242		)
Consolidated	$	396		$	333		$	1,380		$	998

Supplemental product information is provided below for net sales to external customers:



	Quarter ended				Year-to-date period ended
(millions)	September 29, 2018		September 30, 2017		September 29, 2018		September 30, 2017
Snacks	$	1,688	$	1,649	$	5,146	$	5,000
Cereal	1,330		1,355		3,985		3,958
Frozen and other	451		242		1,099		711
Consolidated	$	3,469	$	3,246	$	10,230	$	9,669