K Kellogg Company 2018 Cagny Conference Presentation

Kellogg Company February 21, 2018
Boca Raton
February 21, 2018
Deploy For Growth
Forward-Looking Statements
This presentation contains, or incorporates by reference, “forward-looking statements” with projections concerning, among other things, the
Company’s global growth and efficiency program (Project K), the integration of acquired businesses, the Company’s strategy, zero-based budgeting,
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, charges, rates of return, brand building, ROIC, working capital, growth, new products, innovation, cost
reduction projects, workforce reductions, savings, and competitive pressures. Forward-looking statements include predictions of future results or
activities and may contain the words “expects,” “believes,” “should,” “will,” “anticipates,” “projects,” “estimates,” “implies,” “can,” 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 factors, including the ability to implement Project K (including the exit from its Direct Story Delivery system) as planned, whether the
expected amount of costs associated with Project K will differ from forecasts, whether the Company will be able to realize the anticipated benefits
from Project K in the amounts and times expected, the ability to realize the benefits from our implementation of a more formal Revenue Growth
Management discipline, the ability to realize the anticipated benefits and synergies from the acquisitions in the amounts and at the times expected,
the impact of competitive conditions; the effectiveness of pricing, advertising, and promotional programs; the success of innovation, renovation and
new product introductions; the recoverability of the carrying value of goodwill and other intangibles; the success of productivity improvements and
business transitions; commodity and energy prices; labor costs; disruptions or inefficiencies in supply chain; the availability of and interest rates on
short-term and long-term financing; 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; changes in consumer behavior and
preferences; the effect of U.S. and foreign economic conditions on items such as interest rates, statutory tax rates, currency conversion and
availability; legal and regulatory factors including changes in food safety, advertising and labeling laws and regulations; the ultimate impact of product
recalls; business disruption or other losses from war, 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 update them publicly.
This presentation includes non‐GAAP financial measures. Please refer to the Appendices for a reconciliation of these non‐GAAP financial measures to
the most directly comparable GAAP financial measures. Management believes that the use of such non-GAAP measures assists investors in
understanding the underlying operating performance of the company and its segments.
CAGNY 2018 I DEPLOY FOR GROWTH 2
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Reasons to Believe
Special Sound Financial Commitment and

Food, Brands, Footing Ideas for Growth
& Culture
• Health & Wellness heritage • Reduced cost structure • Better commercial plans
• In most households • Improving top-line performance • Increased investment
• Taste, convenience, • Durable cash flow • New growth platforms
nutrition, affordability
• Weighted toward snacking
• Will to win
Agenda
• Foundation for Growth
• Current Trajectory for Growth
• Deploy for More Growth
• A Realistic Algorithm for Growth
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Big, Strong, Relevant Brands

2017 Net Sales, $ in Billions, Global >$1 billion
$0.5-1.0 billion
$0.3-0.5 billion
A Health & Wellness Company
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A Snacking Company
Composition of Net Sales, Total Company
A Global Company
Composition of Kilos, Total Company
CAGNY 2018 I DEPLOY FOR GROWTH * Shaded area represents percentage of volume associated with Joint Ventures, if we were to include our share of their kilos. 8
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Increasing Emerging Markets Scale & Portfolio

Kellogg Emerging Markets, Volume in Kilos
Joint Ventures
6.8%
CAGR
Snacks: Snacks: 2013-2017
19% of Volume 43% of Volume x-JVs
x-JVs
Agenda
• Deploy for Growth
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Assessing Growth – Portfolio Segments

Net Sales, 2017 * Excludes joint ventures
Growing, larger scale
Emerging
Already growing Markets *
Developed Stabilizing
Developed
Markets – Frozen Markets –
Cereal
Developed
Markets –
Snacks
Returning to growth
Developed Markets Cereal
Recent Past Current Progress Path Forward
• Consumers to protein • Stabilized Canada, U.K., • Expanding occasions

• Special K decline Australia • Influencing food beliefs
• Stabilizing Special K • New pack formats
• Expanding granola • Executing playbook
• Channels expansion
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Developed Markets Snacks
• Special K decline • Pringles global growth • Increased Brand Building

• DSD declining ROI • Transition from DSD • New pack formats
• Rationalizing tail SKUs • RXBAR growth platform
Developed Markets Frozen
• Portfolio trimmed for • Strong growth • On-trend categories

focus • Innovation/renovation • Focus on core
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Emerging Markets
* Excludes joint ventures
*
• Lacked scale • Organic growth • Pringles expansion

• Limited portfolio • Pringles expansion • Granola & wholesome snacks
• Challenging macro • Brazil & Egypt acquisitions • New pack formats
environment • Joint Ventures growth • M&A
Path to Low Single-Digit Sales Growth

Net Sales Growth, Currency-Neutral
Current Trajectory ~+1%
+MSD
Stable
+LSD
“Deploy
For +1-3%
Growth”
+LSD
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Agenda
Deploy For Growth
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Win
Through
Getting the Food Right
Occasions
• Removing “negatives”
• Adding “positives”
• Taste is still king
Win
Through
Getting the Packaging Right
Occasions
Single-Serve, Share of Category, Across All Kellogg U.S. Categories
12.4%
7.2%
2016 2017 2016 2017
Source: Nielsen AOD – xAOC + Convenience – Calendar Years
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Win Building a Stronger Innovation Pipeline

Through
Occasions
Shape a
Investing Where the Growth Is
Growth
Portfolio
Accelerated Growth in ‘17
Global Expansion 20+ Years of Growth
+DD
Consumption
Growth
+DD Consumption
in ‘17 +DD Consumption
Growth in ‘17
Growth in ‘17
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Shape a
M&A For Growth & Scale
Growth
Portfolio
2017 Net Sales:

+Double Digits
2017 Net Sales:*

+Triple Digits
2017 Net Sales:

+Double Digits
2017 Net Sales:*

+Double Digits
CAGNY 2018 I DEPLOY FOR GROWTH * Year-on-Year growth since acquisition, currency-neutral 23
Create
Big Ideas, Big Events
World Class
Marketing
Consumption
+DD
Weeks before and after
Super Bowl
(U.S. Pringles)
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Create
Customized Messaging
World Class
Marketing
When you watch videosabout the latest new
When you watch avideo about how to cook a turkey
tech gadgets
Consumption
When you watch avideo about kid friendlycrafts When you watch a video about kid friendlymeals
+10%
Latest 13 weeks
(U.S. Rice Krispies Treats)
Create
Brand Experience & Conversation
World Class
Marketing
Consumption
+12%
in 2017
(U.K. Corn Flakes)
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Create
Cultural Relevance
World Class
Marketing
• October 2017:
Most-ever Eggo
social mentions
in a single month
• Q4 2017: Eggo
consumption
+14% year-on-
year
Deliver
Perfect
Aiming for Perfect Service
Service &
Store
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Deliver
Perfect
Aisle Reinvention
Service &
Store
Early in
Roll-Out; In Test;
Strong Lift Strong Lift
Deliver
Perfect
In-Store Theater
Service &
Store
Australia Spain
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Deliver
Perfect
E-Commerce
Service &
Store
E-Commerce
Sales
approx. +40%
in 2017
People
Must Be
Talent, Tools, Technology
Competitive
Advantage
• Differentiating
performance and rewards
• Realigning compensation
to drive growth behaviors
• Focusing on leadership and

commercial capabilities
• Leveraging new
technologies
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Change Is Already Visible – Including in Q4 ‘17!
• Targeted areas of growth
• Increased Brand Building
• More differentiated Innovation
• Faster expansion in Emerging Markets
New cereal plant in Nigeria

• M&A for scale or white-space
Agenda
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Financial Approach – Balance
Financial Delivery: Capital Allocation:
Dividend
Bolt-On Acquisitions
Share Repurchases
Investment-Grade
Debt
Sound Financial Footing

Adjusted EPS Growth, Currency-Neutral Basis; Cash Flow in Billions
Guidance
2016 2017 2018
Adjusted EPS * +23% +9% +9-11%
Cash Flow ** $1.1 $1.1 $1.2-1.3

Restructuring Outlays: $0.1 $0.2 $0.2
Cash Flow x-Restructuring Outlays: $1.2 $1.4 $1.4-1.5
• Reduced cost structure

• Stabilized price/mix
• Restructuring-related cash outlays
• Pringles capacity expansion
* Please refer to appendices for reconciliation of non-GAAP measures to the most directly comparable GAAP measure.
** Cash Flow defined as cash from operating activities, less capital expenditure. Please refer to appendices for reconciliation of non-GAAP measures to the most directly
comparable GAAP measure.
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Margins – Continuous Focus on Productivity

Operating Profit Margin, Currency-Neutral Comparable Basis
Affirming 2018 Guidance & Plan

Growth vs. Recast 2017*
Delivering margin expansion and Completing several critical

improving top-line performance. strategic transitions.
Net Sales(a) ~ Flat • Completing Project K initiatives

Currency Neutral
• Operating in post-DSD U.S. Snacks
Adjusted Operating Profit (b) +4-6% • Increasing Brand Investment
Currency-Neutral
• Integrating and growing acquired businesses

Adjusted EPS(b) +9-11%
Currency-Neutral • Investing to grow joint ventures
Cash Flow $1.2-$1.3B • Incorporating U.S. Tax Reform
* Please refer to appendices for reconciliation of non-GAAP measures to the most directly comparable GAAP measure, as well as 2017 recast information for accounting-rules changes.
(a) 2018 guidance for Currency Neutral Net Sales growth excludes the impact of foreign currency translation.
(b) 2018 guidance for adjusted Operating Profit and Earnings Per Share excludes the impact of mark-to-market adjustments and costs related to Project K. Currency neutral also excludes the impact of foreign
currency translation.
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Targeting Long-Term Sustainable Growth

All Growth Rates are Currency-Neutral
Net Sales 1-3%

Adjusted Operating Profit 4-6%
Adjusted EPS 6-8%
Dividend Yield 2-3% *
Total Shareowner Return 8-11% *
Dependable growth, augmented by M&A, complemented by dividend yield.
CAGNY 2018 I DEPLOY FOR GROWTH * Independent of changes in valuation multiple and market fluctuations 39
Values
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In Summary…
• Strong foundation for growth
• Visible progress
• Deploying for growth
• Seeking balanced financial delivery
APPENDIX
CAGNY 2018 I DEPLOY FOR GROWTH
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EPS – Reconciliation to non-GAAP Measure
Growth Growth
2017 2016 Rate 2016 2015 Rate
Reported EPS $ 3.62 $ 1.96 $ 1.96 $ 1.72
Mark-to-market (pre-tax) 0.13 (0.74) (0.74) (1.25)
Project K and cost reduction activities (pre-tax) (0.75) (0.92) (0.92) (0.91)
Debt redemption (pre-tax) - (0.43) (0.43) -
VIE deconsolidation (pre-tax) - - - 0.13
Venezuela deconsolidation (pre-tax) - (0.20) (0.20) -
Venezuela remeasurement (pre-tax) - (0.03) (0.03) (0.47)
Income tax impact applicable to adjustments, net 0.22 0.56 0.56 0.74
U.S. Tax Reform adoption impact (0.01) - - -
Foreign currency impact (0.01) - (0.57) -
Currency-neutral Adjusted EPS $ 4.04 $ 3.72 8.6% $ 4.29 $ 3.48 23.3%
Note: These figures are not yet recast for the accounting-standards changes effective in 2018.
43
Cash Flow – Reconciliation to non-GAAP Measure

Kellogg Company and Subsidiaries
Reconciliation of Non-GAAP amounts - Reported Cash Flow to Kellogg-Defined Cash Flow
Years ended 2015-2017 Exhibit 2
2015 2016 2017

Operating Activities
Net Income $ 614 $ 695 $ 1,269
Adjustments to reconcile net income to operating cash flows:
Depreciation and amortization 534 517 481
Postretirement benefit plan expense 320 198 (427)
Deferred income taxes (169) (26) (56)
Stock compensation 51 63 66
Venezuela deconsolidation 72
Venezuela remeasurement 169 11
VIE deconsolidation (49)
Non current income taxes payable (21) (12) 144
Other 8 (62) 27
Postretirement benefit plan contributions (33) (33) (44)
Changes in operating assets and liabilities, net of acquisitions 267 205 186
Net cash provided by (used in) operating activities 1,691 1,628 1,646
Less:
Additions to properties (553) (507) (501)
Cash flow (operating cash flow less property additions) (a) $ 1,138 $ 1,121 $ 1,145
(a) Cash flow is defined as net cash provided by operating activities less capital expenditures. We use this non-GAAP
financial measure to focus management and investors on the amount of cash available for debt repayment, dividend
distributions, acquisition opportunities and share repurchase.
44
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Financial Guidance – Reconciliation to non-GAAP Measures

Kellogg Company and Subsidiaries
Reconciliation of Non-GAAP amounts - 2018 Full Year Guidance*
Exhibit 3
Operating Effective Earnings

Impact of certain items excluded from non-GAAP guidance: Net Sales Profit Tax Rate Per Share
Project K and cost restructuring activities $90-110M $0.27-0.32
Income Tax benefit applicable to adjustments, net** $0.05-0.06
Adjusted, currency-neutral guidance Flat 4-6% 20-21% 9-11%
* 2018 full year guidance for net sales, operating profit, and earnings per share are provided on a non-GAAP basis only because certain
information necessary to calculate such measures on a GAAP basis is unavailable, dependent on future events outside of our control and
cannot be predicted without unreasonable efforts by the Company. The Company is providing quantification of known adjustment items
where available.
** Represents the estimated income tax effect on the reconciling items, using weighted-average statutory tax rates, depending upon the
applicable jurisdiction.
Reconciliation of Non-GAAP amounts - Cash Flow Guidance

(billions)
Approximate
Full Year 2018
Net cash provided by (used in) operating activities $1.7 - $1.8
Additions to properties ~($.5)
Cash Flow $1.2 - $1.3
45
2017 Recast Items – Accounting Standard Change
Comparable Basis
Reported Basis
46
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2017 Recast Items – Product Transfers
47
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Kellogg Company February 21, 2018

Deploy For Growth

CAGNY 2018 I DEPLOY FOR GROWTH 2

Special Sound Financial Commitment and

CAGNY 2018 I DEPLOY FOR GROWTH 3

• Foundation for Growth

• Current Trajectory for Growth

• Deploy for More Growth

• A Realistic Algorithm for Growth

CAGNY 2018 I DEPLOY FOR GROWTH 4

Big, Strong, Relevant Brands

CAGNY 2018 I DEPLOY FOR GROWTH 5

A Health & Wellness Company

CAGNY 2018 I DEPLOY FOR GROWTH 6

CAGNY 2018 I DEPLOY FOR GROWTH 7

Increasing Emerging Markets Scale & Portfolio

CAGNY 2018 I DEPLOY FOR GROWTH 9

• Foundation for Growth

• Current Trajectory for Growth

• Deploy for Growth

• A Realistic Algorithm for Growth

CAGNY 2018 I DEPLOY FOR GROWTH 10

Assessing Growth – Portfolio Segments

Developed Markets Cereal

Recent Past Current Progress Path Forward

• Consumers to protein • Stabilized Canada, U.K., • Expanding occasions

CAGNY 2018 I DEPLOY FOR GROWTH 12

Developed Markets Snacks

Recent Past Current Progress Path Forward

• Special K decline • Pringles global growth • Increased Brand Building

CAGNY 2018 I DEPLOY FOR GROWTH 13

Developed Markets Frozen

Recent Past Current Progress Path Forward

• Portfolio trimmed for • Strong growth • On-trend categories

CAGNY 2018 I DEPLOY FOR GROWTH 14

Recent Past Current Progress Path Forward

• Lacked scale • Organic growth • Pringles expansion

CAGNY 2018 I DEPLOY FOR GROWTH 15

Path to Low Single-Digit Sales Growth

Current Trajectory ~+1%

CAGNY 2018 I DEPLOY FOR GROWTH 16

• Foundation for Growth

• Current Trajectory for Growth

• Deploy for More Growth

• A Realistic Algorithm for Growth

CAGNY 2018 I DEPLOY FOR GROWTH 17

Deploy For Growth

CAGNY 2018 I DEPLOY FOR GROWTH 18

• Taste is still king

CAGNY 2018 I DEPLOY FOR GROWTH 19

2016 2017 2016 2017

Source: Nielsen AOD – xAOC + Convenience – Calendar Years

CAGNY 2018 I DEPLOY FOR GROWTH 20

Win Building a Stronger Innovation Pipeline

CAGNY 2018 I DEPLOY FOR GROWTH 21

Accelerated Growth in ‘17

Global Expansion 20+ Years of Growth

2017 Net Sales:

2017 Net Sales:*

2017 Net Sales:

2017 Net Sales:*

CAGNY 2018 I DEPLOY FOR GROWTH 24