Kashi, based in La Jolla, Calif., since the company’s founding in 1984, will move to the Kellogg Co. headquarters in Battle Creek, said Kris Charles, a company spokesperson for Kellogg. With the move, Kashi will be best positioned for continued growth, she said.
Kellogg eliminated 14 Kashi jobs and offered 14 other Kashi employees the opportunity to relocate to Battle Creek, Ms. Charles said.
“We do not take lightly the impact on the Kashi team and are working with impacted employees to consider alternative roles across Kellogg Co., where possible,” she said.
Kashi joined the Kellogg brand portfolio in 2000. Kellogg’s Morning Foods & Kashi business, which is comprised of U.S. cereal, Kashi, Health & Wellness and Pop-Tarts toaster pastries, had fiscal-year 2012 operating profit of $595 million, which was down from $611 million in fiscal year 2011. Fiscal-year sales rose to $3,707 million from $3,611 million.
The Kashi brand plays well in the natural and organic segment, said Michael Allen, president of Kellogg’s U.S. Frozen Foods, in a Feb. 5, 2013, earnings conference call.
“It’s a brand that consumers know and trust, and we’ve added innovations to our existing pizza and entrée businesses,” he said. “In 2012, we launched Kashi steamed meals, a convenient and easy way to get delicious, natural meals.”
In cereal, however, Kellogg faces challenges in its Kashi business, said John Bryant, president and chief executive officer of Kellogg, in the Feb. 5 call.
“We’re not happy with the performance of our Kashi business,” he said. “We think it’s more tactical in nature. Over the next six months we’re going to work to fix and improve that business, get it back in the right direction. But we obviously have some work to do there.”
Phil and Gayle Tauber founded the Kashi business in 1984 and originally had one product, Kashi breakfast pilaf. Kashi branded products now include hot cereal, ready-to-eat cereal, snack bars, crackers, entrees, pizza, cookies, pilaf and waffles.
