BATTLE CREEK, MICH. — The WK Kellogg Co’s fiscal 2023 was buoyed by price increases taken earlier in the year. For the full year, price/mix increased 12.6% while volume sold fell 9.8%. Of concern for management may be the fourth quarter trend of price/mix rising 7.5% and volume declining 10.1%.

“Net sales for the fourth quarter were $651 million, a 2.7% decline versus the prior year period,” said David McKinstray, chief financial officer, during a Feb. 13 conference call to discuss the results. “This performance reflects positive price of 7.5%, offset by volume declines of 10.1% related to, among other things, rising price elasticities due to the timing of our price increases. We spoke about this dynamic on our third-quarter call and said at the time that we expect it to continue into Q4 and early Q1.”

WK Kellogg Co net income for the year ended Dec. 30, 2023, was $110 million, equal to $1.28 per share on the common stock, and an improvement over fiscal 2022 when the company recorded a loss of $25 million.

Annual sales were $2.76 billion, up from $2.70 billion the year before.

Management attributed the positive bottom-line results to the company’s ability to focus solely on the cereal category following its split from the Kellogg Co., and execution of its revenue growth management (RGM) strategy. The RGM strategy has three components, including innovation around premiumization, promotional effectiveness and price pack architecture.

Innovation focused on premiumization has included the introduction of the Mouth Off and Extra brands. Mouth Off is a vegan cereal with 22 grams of plant-based protein, no sugar and 2 grams of net carbs or less per serving. The Extra brand is a taste-led granola, according to the company.

“Promotional effectiveness is about designing and executing our promotional activities to drive better returns,” said Gary H. Pilnick, chief executive officer. “The integration of our teams across marketing, sales and supply chain gives us increased visibility, which allows us to more optimally design and plan. Through our dedicated sales force, we can also execute those promotions better and our single category focus means we could drive better merchandising and amplify promotions in-store.”

WK Kellogg also has introduced standardized pack sizes across multiple brands.

“This drives more standardization in our business, which creates efficiency within our supply chain and allows customers to offer the type of unique value their consumers are looking for,” Pilnick said.

For fiscal 2024, the WK Kellogg Co is guiding more of the same, with positive returns from pricing actions taken in March 2023 and a continued volume decline.

“We expect 2024 full-year net sales growth to be in the range of negative 1% to positive 1%,” McKinstray said. “Due to our revenue growth management initiatives, we expect full-year price to be positive low single digits and volume to decline low single digits.

“For 2024, EBITDA, we expect growth in the range of 3% to 5%, which reflects EBITDA dollar delivery of between $265 million and $270 million. This is an increase versus the $255 million to $265 million range.”

Additionally impacting the company in fiscal 2024 will be the elevated costs of some inputs.