2. Forward-Looking Statements
This presentation contains, or incorporates by reference, “forward-looking statements” with
projections concerning, among other things, the Company’s strategy, and the Company’s sales,
earnings, margin, operating profit, costs and expenditures, interest expense, tax rate, capital
expenditure, dividends, cash flow, debt reduction, share repurchases, costs, brand building, ROIC,
working capital, growth, new products, innovation, cost reduction projects, and competitive pressures.
Forward-looking statements include predictions of future results or activities and may contain the
words “expects,” “believes,” “should,” “will,” “will deliver,” “anticipates,” “projects,” or words or phrases
of similar meaning.
The Company’s actual results or activities may differ materially from these predictions. The
Company’s future results could also be affected by a variety of other factors, including competitive
conditions and their impact; the effectiveness of pricing, advertising, and promotional spending
programs; the success of productivity improvements and business transitions; the success of
innovation and new product introductions; the recoverability of carrying amounts of goodwill and other
intangibles; the availability of and interest rates on short-term financing; changes in consumer
behavior and preferences; commodity and energy prices and labor costs; actual market performance
of benefit plan trust investments; the levels of spending on systems initiatives, properties, business
opportunities, integration of acquired businesses, and other general and administrative costs; U.S. and
foreign economic conditions including interest rates, taxes and tariffs, and currency rate translations or
unavailability; legal and regulatory factors; the underlying price and volatility of the Company’s
common stock and the impact of equity-based employee awards; business disruption or other losses
from terrorist acts or political unrest; and other items.
Forward-looking statements speak only as of the date they were made, and the Company undertakes
no obligation to publicly update them.
2
3. First Quarter 2008: Continued Momentum
• Strong Revenue Growth
• Affirming Full-Year Guidance
• Returning Cash to Shareholders
3
4. Summary of Financial Results
Millions, except EPS
First Quarter Growth
2008 2007 Reported Internal
Net Sales 1 $ 3,258 $ 2,963 10% 5%
Operating Profit 1 $ 545 $ 499 9% 6%
Earnings Per Share $ 0.81 $ 0.80 1%
2
Cash Flow $ 181 $ 289 -37%
1) Internal sales and operating profit growth exclude the impact of foreign currency translation and if applicable,
acquisitions, dispositions, and shipping day differences.
2) Cash Flow, defined as cash from operating activities less capital expenditures, is reconciled to the comparable
GAAP measure at the end of this presentation.
4
6. Reinvestment for the Future:
Growth in Advertising
% Change, Net Sales and Advertising
Net Sales
Advertising
+10%
+DD
+9%
+ MSD
Q1 2007 Building Q1 2008 Building
Net Sales Brand Net Sales Brand
6
7. Gross Profit and Margin*
$ Millions
- Acquisitions
+ Operating leverage
- Energy and fuel
+ Productivity savings
- Commodities
+ Price/Mix
$1,364
$1,264
8%
Growth
Q1 2007 Q1 2008
Gross Margin* 42.7% 41.9%
* Gross profit as a % of net sales
7
8. First Quarter 2008:
Internal Operating Profit Growth by Area
Year-Over-Year % Change, Internal Growth (1)
9.8%
6.4%
3.9%
-0.6% -6.8%
Total North Latin
Europe Asia
America Pacific (2)
Company America
1. Internal operating profit growth excludes the impact of foreign currency translation
and if applicable, acquisitions, dispositions, and shipping day differences.
2. Includes Australia, Asia, and South Africa.
8
9. First Quarter 2008: Strong Cash Flow *
$ Millions
$289
$181
$101
Q1 2006 Q1 2007 Q1 2008
*Kellogg defines Cash Flow as cash from operating activities, less capital
expenditure; see reconciliation to GAAP cash flow at the end of this presentation.
9
10. 2008 Outlook:
Another Year of Growth
Full-Year 2008
Internal Net Sales* +Mid SD
- Greater than our long-term target
Internal Operating Profit* +Mid SD
- Significant investment in innovation
- Strong advertising
- Incremental commodity, energy, fuel,
benefits expense of approximately 80 cents
- Continued up-front cost investment
Earnings Per Share
Guidance Range of $2.92 to $2.97
- Higher tax rate of approximately 31%.
* Internal sales and operating profit growth exclude the impact of foreign currency
translation and if applicable, acquisitions, dispositions, and differences in the
number of shipping days.
10
12. First Quarter 2008:
Broad-Based Growth in North America
Year-Over-Year %, Internal Net Sales Growth (1)
10%
5%
4% 4%
(2) (3)
Total North America Retail Cereal Retail Snacks Frozen and (4)
Specialty Channels
1) Internal sales growth excludes the impact of foreign currency translation and if
applicable, acquisitions, dispositions, and differences in the number of shipping days.
2) Includes U.S. and Canada retail cereal.
3) Includes biscuits, wholesome snacks, Pop-Tarts, and fruit snacks.
4) Includes frozen foods, Food Away From Home, and custom manufacturing.
12
13. North America Retail Cereal:
Internal Net Sales Growth*
Year-Over-Year % Change
8%
4%
4%
3%
0%
Q1 Q2 Q3 Q4 Q1
2007 2008
* Internal sales growth excludes the impact of foreign currency translation and if
applicable, acquisitions, dispositions, and differences in the number of shipping days.
13
14. North America Retail Snacks:
Internal Net Sales Growth*
Year-Over-Year % Change
11%
9%
5% 4%
2%
Q1 Q2 Q3 Q4 Q1
2007 2008
* Internal sales growth excludes the impact of foreign currency translation and if
applicable, acquisitions, dispositions, and differences in the number of shipping days.
14
15. First Quarter 2008:
North America Retail Snacks
Year-Over-Year Change, Net Sales
Sales
Toaster Pastries
Crackers
Cookies
Wholesome Snacks
Portfolio +4%
15
16. North America Frozen & Specialty Channels(1):
Internal Net Sales Growth (2)
Year-Over-Year % Change
10%
8%
6%
6%
5%
Q1 Q2 Q3 Q4 Q1
2007 2008
1) Includes Frozen Foods, Food Away From Home, and custom manufacturing.
2) Internal sales growth excludes the impact of foreign currency translation and if applicable,
acquisitions, dispositions and differences in the number of shipping days.
16
17. Kellogg International:
Internal Net Sales Growth*
Year-Over-Year % Change
6% 6%
5% 5%
4%
Q1 Q2 Q3 Q4 Q1
2007 2008
* Internal sales growth excludes the impact of foreign currency translation and if
applicable, acquisitions, dispositions, and differences in the number of shipping days.
17
18. First Quarter 2008: International Growth
Year-Over-Year % Change, Internal Sales Growth (1)
7%
6% 5% 5%
Latin Asia (2)
Total Europe
America Pacific
International
1) Internal sales growth excludes the impact of foreign currency translation and if
applicable, acquisitions, dispositions, and differences in the number of shipping days.
2) Includes Australia, Asia, and South Africa.
18
19. First Quarter 2008: Continued Momentum
• Strong Q1 Execution
• Strong Innovation & Investment
• Sustainable and Dependable
19
21. Appendix 1
Reconciliation of Kellogg-Defined* Cash Flow to GAAP Cash Flow
Year-to-date period ended
March 29, March 31,
2008 2007
(unaudited)
Operating activities
Net earnings $315 $321
Adjustments to reconcile net earnings to
operating cash flows:
Depreciation and amortization 94 87
Deferred income taxes (11) (33)
Other 70 28
Postretirement benefit plan contributions (41) (30)
Changes in operating assets and liabilities (179) (18)
Net cash provided by operating activities 248 355
Less:
Additions to properties (67) (66)
Cash flow $181 $289
*We use this non-GAAP measure of cash flow to focus management and investors on the
amount of cash available for share repurchases, dividend distributions, acquisition
opportunities, and debt reduction.
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