Frozen and Specialty Channels.
Solid performance came from Frozen and Specialty Channels, with sales rising 6% for the year, building on 8% growth in 2006 and 2005.
Frozen.
In 2007 sales in our Frozen business grew, driven by a double-digit increase in advertising from 2006. Our leading market share in frozen breakfast products grew because of strong innovation in Eggo Blueberry pancakes, Eggo waffles and Eggo Stuffed French Toaster Sticks. In addition, our healthy waffle segment had solid growth with the launch of Nutri-Grain Cinnamon waffles and Special K Red Berries waffles.
Our Veggie Food business, under the Morningstar Farms brand, continues to perform well. In 2007 we added to the popular Morningstar Farms sausage patties with the introduction of Breakfast Starters and Breakfast Bites. Our consumers continue to "see veggies differently" with creative new choices like Mushroom Mozzarella Veggie Bites. Consumers can now enjoy meatless diet choices with our product line from breakfast to dinner. With our acquisition of Gardenburger veggie foods, we will be producing more exciting innovations.
With "7 whole grains on a mission," Kashi continues to provide additional growth opportunities with its popular frozen line. Kashi waffles are off to a good start, and the new frozen entrees and pizzas have performed above expectations. We saw a strong response to three additional entrees and introduced three new pizza varieties in 2007.
Another strength is our Club business, which continued to successfully build the Kashi brand franchise. The launches of Kashi frozen entrees and pizzas were key to the brand's continued success in Club.
Specialty Channels.
Growth in our Specialty Channels business was driven by Food Away From Home, as well as Convenience and Drug channels.
Success continued with our strategy to leverage key equities for channel relevance. This was clearly illustrated in our successful launch of Jump-Starts breakfast kits for the K-12 school segment. This convenient breakfast alternative for public schools is designed to provide students access to a quality breakfast.
And finally, the success of our Convenience/Drug business continued from leveraging core equities, such as the introduction of single-serve Keebler Soft Batch cookies for convenience stores. This, along with broad wins in the Drug channel through efficient participation in key promotion periods such as back to school and New Year's resolution, also contributed to our continued success.
