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Kellogg Reiterates Outlook for Sustainable Growth in 2003 & Beyond

BATTLE CREEK, Mich., Feb. 18 /PRNewswire-FirstCall/ -- In a presentation to investors at the Consumer Analyst Group of New York Conference, Kellogg Company (NYSE: K) reiterated its near-term sales and earnings outlook and emphasized its goal of steady, sustainable growth.

The Company reconfirmed its earnings per share guidance of $0.38 - 0.40 for the first quarter of 2003, and $1.86 - 1.90 for the full year.

"At this conference a year ago, we laid out plans to build a better company," said Carlos Gutierrez, Kellogg's chairman and chief executive officer. "Today we can confidently say that Kellogg truly is a better company. Our growth targets are realistic, and they put us on a path of consistent growth and value creation that can be sustained over time."

David Mackay, President of Kellogg USA, reviewed the recent performance and 2003 plans for Kellogg's U.S. business. Investment in brand-building and innovation, along with a focus on value instead of volume, will allow each of the U.S. businesses -- Retail Cereal, Retail Snacks, Other -- to generate low single digit sales growth in 2003.

Alan Harris, President of Kellogg International, described a similar approach to driving low single-digit net sales growth for Kellogg's international business. Implementing "volume to value" and increasing investment in brand-building and innovation will drive cereal growth, and the Company will continue to expand its Snacks business in core international markets.

Mr. Gutierrez said, "In the past year we have added capabilities and improved our execution, which has lifted our sales growth. Meanwhile, we have become more profitable and we are generating significant cash flow. We have a sustainable financial model and an improved financial flexibility which will allow us to sustain our growth in the future."

About Kellogg Company

With 2002 sales of $8.3 billion, Kellogg Company is the world's leading producer of cereal and a leading manufacturer of convenience foods such as cereal bars, frozen waffles, toaster pastries, cookies, and crackers. The company also produces natural and vegetarian foods.

Founded in 1906 and dedicated to providing nutritious, good-tasting foods, Kellogg has manufacturing facilities in 19 countries and sells its products in more than 180 countries. Kellogg brands include Kellogg's, Keebler, Pop- Tarts, Eggo, Nutri-Grain, Cheez-It, Morningstar Farms, and Kashi. For more information, visit Kellogg's web site at

Forward-Looking Statements Disclosure

This news release contains forward-looking statements related to business performance, cash flow, costs, sales, operating profit, earnings and growth. Actual performance may differ materially from these statements due to factors related to the Keebler acquisition, including integration problems, failures to achieve synergies, unanticipated liabilities, and the substantial amount of indebtedness incurred to finance the acquisition (which could, among other things, hinder the company's ability to adjust rapidly, make the company more vulnerable to a downturn, and place the company at a competitive disadvantage to less-leveraged companies); competitive conditions and their impact; pricing and promotional spending; the effectiveness of marketing spending and programs; the success of productivity improvements and business transitions; the success of innovation and new product introductions; the availability of and interest rates on short-term financing; commodity prices and labor costs; actual market performance of investments; changes in consumer behavior and preferences; U.S. and foreign economic factors such as interest rates, statutory tax rates, and foreign currency translations or unavailability; legal factors; business disruption or other losses from terrorist acts or political unrest; and other factors.

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