Europe
Kellogg Europe turned in another solid year in 2007. In what continues to be a challenging operating environment, overall sales increased mid single-digits, lapping similar growth in 2006. Europe's growth was broad-based across countries and categories – driven by strong commercial programs, category-leading product innovations and a double-digit increase in advertising investment.
Our two most developed markets, U.K. and Ireland, posted mid single-digit growth in cereal and even stronger growth in snacks. We increased our share in a U.K. ready-to-eat cereal catagory that continued to show strong growth. We also grew share in the cereal bar category in both markets. Programs like our Special K "Drop a Jeans Size" proved very effective in engaging consumers. And there was strong response to cereal innovations like Special K Sustain and Coco Pops Creations. Special K Mini Breaks snacks were introduced in the second half of the year to a strong start, and both Rice Krispies Squares and Rice Krispies cereal enjoyed tremendous growth, driven by engaging advertising campaigns.
Adult consumption of cereal continues to expand across the region. Optivita, our heart health cereal, was launched, and combined with market leader Special K, continued to drive our adult business.
Southern Europe reported the strongest growth across the area, with high single-digit sales increases in both Italy and Spain. With per capita cereal consumption in these markets below the levels of Northern Europe, further growth potential exists.
Our Snacks business in these markets is still young and continues to expand rapidly, helped by increased availability and inclusion in major cereal programs.
Performance in France, our second largest European market, was also positive with mid single-digit growth in cereal.
