Kathryn Koessel – Vice President, Investor Relations A. D. David Mackay – President and Chief Executive Officer John A. Bryant – Chief Operating Officer Ronald Dissinger – Chief Financial Officer

Terry Bivens - J.P. Morgan Robert Moskow - Credit Suisse Cornell Burnette - Citi Investments David Palmer - UBS Investment Research Alexia Howard - Sanford Bernstein Ken Zaslow - BMO Capital Markets Vincent Andrews - Morgan Stanley Alex Patterson - RCM Edward Aaron - RBC Capital Markets Corp. Judy Hong - Goldman Sachs Eric Katzman - Deutsche Bank Chris Growe - Stifel Nicolaus

Good morning and welcome to the Kellogg Company fourth quarter and full year 2009 earnings conference call. (Operator's Instructions). At this time I will turn the call over to Kathryn Koessel, Kellogg Company Vice President of Investor Relations. Ms. Koessel, you may begin your conference.

Thank you, Christina. Good morning, thank you for joining us today and welcome to the review of our 2009 fourth quarter and full-year results and a discussion of our ongoing strategy and outlook. Joining me are David Mackay, our President and CEO, John Bryant, Chief Operating Officer and Ronald Dissinger, Chief Financial Officer. The press release and slides that support our remarks today are posted on our website at www.kelloggcompany.com. As you are aware, certain statements made today such as projections for Kellogg Company’s future performance, including earnings per share, net sales, margin, operating profit, interest expense, tax rate, cash flow, brand building, up-front costs, impact of the recalls and inflation are forward-looking statements. Actual results could be materially different from those projected. For further information concerning factors that could cause these results to differ, please refer to the second slide of this presentation as well as to our public SEC filings. As a reminder a replay of today’s conference call will be available by phone through Monday February 8th, the call will also be available via webcast which will be archived for 90 days. Now let me turn it over to David. A. D. David Mackay: Thanks, Catherine and good morning, everyone. We're pleased to report another strong year of sustainable, dependable performance of the Kellogg Company, our business model and focus strategy are helping us weather the tough consumer and customer environment and positioning us for growth now and well into the future despite the current economic backdrop. Our focus has been and will continue to be to sustainably grow the top-line, drive investment in our brands, build an effective and cost efficient infrastructure and consistently deliver solid results for the long-term. As I said last quarter, and I think it bears repeating, 2009 is certainly presented us with challenges and yet at the same time, given us opportunities to build an even stronger Kellogg Company. The weaker global economic environment has lessened the inflationary pressure on pricing and increased distress level on consumers which has translated into moderating top-line growth. However, consumers are seeking ways to maximize value and trading into some of our core categories such as, cereal and markets like the U.S. and the U.K. Consumers recognize that our brands recognize value great taste and good nutrition so that positions us well for the future, another benefit of the weaker economy is media deflation in key markets. As a result our increased investment and advertising has significantly grown our underlying impressions. On an internal basis, our advertising grew 15% in the back half of the year and nearly 7% for the full year. As discussed at our (inaudible) and on previous earnings calls, we've been focusing on improving productivity and reducing costs. We completed the first year of our three year billion dollar plus cost reduction program. In 2009 we exceeded our expectations in cost savings, now adding a plus to the billion dollar challenge, the result? Strong earnings per share growth and record cash flow for 2009. Benefiting from the 2009 momentum we enter 2010 with a solid pipeline of innovation and renovation as well as a renewed commitment to productivity and cost savings. We continue to focus on building a Kellogg Company resilient to economic conditions and poised to forge ahead. With excellent financial visibility into our future financial performance we remain confident in our ability to deliver another year of sustainable and dependable growth. And with that I'd now like to introduce our newly appointed CFO, Ron Dissinger for the review of financials. Ron, over to you.

Thanks, David. Good morning, everyone. Let me begin with a summary of our 2009 financial results on slide four, as David said despite the challenges of a weak economy in a competitive landscape, we had a good year. We met and exceeded our 2009 guidance on growth rates of 3%-4% internal net sales, 8%-10% internal operating profit and 10%-12% currency neutral earnings per share. In 2009, out internal net sales grew 3%, with strong operating profit growth at the top-end of our range. As you are aware our internal numbers exclude the effect of foreign exchange acquisitions and a 53rd week in 2008, our net sales growth reflects a particularly strong year in retail cereal and a solid year in retail snacks, which helped to off-set the pressures we experienced in our food severance business due to industry trends, and the supply disruption in our Eggo Waffle business. We continue to invest in our brand and we've increased our up-front cost investments to $0.26 per share for the full-year compared with $0.14 per share in 2008. Our solid sales performance combined with our cost savings and our productivity initiatives as well as moderating commodity inflation drove 10% internal operating profit growth for the year. This resulted in our full-year 2009 earnings per share of $3.16 a 6% increase on a reported basis and a 13% increase on a currency neutral basis. As we said on our third quarter call, we expected below the line items to negatively impact our full-year and fourth quarter results. The primary drivers include full-year interest expense of $295 million, which includes the cost of the bond tender offer, completed in December 2009. This enabled us to refinance a portion of our 2011 bond maturity at an attractive interest rate. Impacting the other income and expense line was a charitable contribution in the fourth quarter. In addition, we took an approximate $0.02 hit to our earnings per share in the fourth quarter from the impact of Venezuelan. The situation in Venezuela is changing rapidly, however profits from this business are only 1%-2% of total company results and we think we are appropriately positioned. Partially off-setting these expenses we'd benefitted from some discrete favorable tax items in 2009, lowering our tax rate to 28.2%. On slide five we'll walk through the components of our internal sales growth for the fourth quarter and full year. Year-over-year reported net sales for the full-year 2009 declined by 1.9%, on an internal basis net sales grew 3%. The following components contributed to our sales performance, our (inaudible) declined by seven tenths of a point during the year, much of this decline came from our continued transition away from low margin products in Russia and China and the Eggo supply disruption. This decline masks a strong volume performance in cereal. Price and mix contributed 3.7 points of growth to the business, currency reduced our reported growth by 3.7 points and acquisitions increased our reported growth by a modest three tenths of a point. Also note that the 53rd week on the fourth quarter of 2008, impacted our reported sales growth unfavorably by 1.5% for the full year. Each of our operating segments contributed to net sales growth for the year, internal net sales for North America increased 2.8%, Europe rose 1.6% and Latin America grew 6.8%, while Asia Pacific improved by 5%. Our fourth quarter internal net sales grew approximately 2%. Now, let's turns to slide six to discuss cost pressures. As expected commodity prices moderated during the year, reducing our cost pressures and cost of goods sold to approximately 3%. This compares to much higher inflation rates of the past several years. Our billion dollar plus challenge cost reduction initiatives combined with price execution early in the year more than offset these cost pressures in 2009, and improved our growth margin during the year. For 2010 we expect cost pressures to remain at approximately 3%. For 2009, our gross profit was $5.4 billion. On an internal basis our gross profit grew 6% for the year. Gross margin increased 100 basis points to 42.9% due to price increases as well as savings initiatives and cost of goods sold and these more than offset inflation and higher upfront costs. Internal gross margin was up 120 basis points and if we exclude the impact of upfront costs, gross margin was up 160 basis points for the year. For 2010 we expect gross margin improvement of approximately 100 basis points. As you can see on slide eight, we have continued our commitment to reinvesting in our brands through advertising, it remains a key component of our business model and we believe essential to achieving our long-term goals. As we have said, we experienced media deflation in the year, lower prices combined with increased media efficiencies, and increased investment resulted in a significant increase in impressions. In 2010 we expect our advertising to grow at a higher rate than sales, even with expected media deflation in key markets. Slide nine highlights are internal operating profit growth by area. Despite heavy investment in advertising and upfront costs our North America business still delivered 11% internal operating profit growth. And in the fourth quarter North America internal operating profit increased by a healthy 25%, while Europe delivered moderate sales growth for the year both operating efficiencies and media deflation contributed to a strong 7% internal operating profit increase for the year. In the fourth quarter, Europe delivered 13% internal operation profit growth. Latin America showed strong internal sales growth for the year, however, internal operating profit declined by 2%, significantly higher input costs and increased advertising contributed to the full-year decline. In addition, a December reduction in trade inventory impacted both full-year and the fourth quarter sales and profits. This trade inventory reduction increased advertising investment and higher upfront costs contributed to a 52% decline in internal operating profit for the fourth quarter. And in Asia Pacific internal operating profit increased by 14% for the full year driven by sales performance, however, increased advertising contributed to a 21% decline in fourth quarter internal operating profit. Now, let's turn to slide 10 to discuss cash flow. Managing for cash continues to be a key operating principle for Kellogg, we are focused on growing net earnings and remain disciplined about core working capital and our balance sheet. We delivered record cash flow of $1.27 billion in 2009. Our strong cash flow generation has given us flexibility to support our business and continue to return cash to shareholders. Capital spending declined to 3% of net savings in 2009, versus 3.6% in 2008. As we said on our third quarter call for 2010, we expect capital spending to be approximately $500 million at the high-end of our 3%-4% range. Driven by capacity increased our Eggo Waffle network and cost to re-implement SAP across our Americas' businesses. Also in the fourth quarter we reduced our commercial papers significantly and took our net debt to one of the lowest of levels since the Keebler acquisition, providing us with a strong liquidity position. Given the potential for continued volatility in the economy we believe this position does very well for the future. For 2010 we expect our cash flow to be comparable to 2009, given the increase in capital spending. In sum, we were pleased with our 2009 performance posting solid sales growth and effectively managing our cost structure, while at the same time increasing our investment in advertising and upfront costs. We posted a double digit increase in internal operating profit, invested in our future growth and improved our financial visibility. It was a very good year for Kellogg delivering high quality earnings in a very difficult economic environment, another year of sustainable and dependable performance. Now let's turn to slide 12 for our expectations for 2010, we remain confident in our ability to deliver another year of sustainable and dependable growth and we are raising our 2010 currency neutral EPS forecast. We expect to continue to drive volume and mix to grow internal met sales to 2%-3%. Our focus on productivity and expected moderate inflationary environment and lower upfront cost should result in approximately 100 basis points of gross margin expansion. 2010 upfront investments are projected to be approximately $0.16 per share, about half of these costs are allocated to the K LEAN manufacturing initiative. While our upfront costs should help accelerate our internal operating profit growth to 8%-10%, which is above our long-term targets. Below the line we expect interest expense to be in the range of $250-$260 million, our effective tax rate is projected to be between 30%-31%. Shares outstanding are expected to decline as we execute the remaining $463 million of the 2009 share repurchase authorization plus the $650 million we authorized for 2010. We expect to lower shares outstanding by 2%-3% for 2010. Our guidance for earnings per share has increased and is now 11%-13% growth on a currency neutral basis. To understand the impact of foreign exchange on our 2009 results and in 2010, please turn to slide 13. As we discussed on previous calls, moving from currency neutral to reported earnings per share guidance requires us to estimate the impact of foreign exchange on our earnings per share performance. The full-year 2009 adverse impact of translational foreign exchange was $0.22 on EPS, up from our November estimate of $0.21. Slide 13 shows our key current currencies for 2009 actual rates and current spot rates as of February 1, 2010. Based on these spot rates, foreign exchange is estimated to be flat compared with our earlier estimate of a favorable $0.08, approximately one half of the change is related to the devaluation of the currency in Venezuela. As you are well aware foreign exchange is a moving target, so we are prepared to update you on the impact on a quarterly basis. And now I'd like to turn it over to John to discuss our business operations. John A. Bryant: Thanks, Ron and good morning, everyone. We delivered strong results in 2009 and are well positioned to deliver another year of sustainable dependable performance in 2010. As you can see on slide 14, our 2009 North America internal sales grew 3% versus 6% last year. It was a particularly strong year for both retail cereal and snacks. However, weakness in frozen and food service, which I will address in a moment, dampened net sales for the year and particularly in the fourth quarter. As we look forward to 2010, we expect that North American sales growth will be in the low single digit range. Let me discuss each business in greater detail beginning with cereal on slide 15. (inaudible) cereal continues to be a strong category responding well to brand building, nutrition and innovation. Cereal is also great value and we have seen growth in all of our core markets around the world. By our estimate the (inaudible) cereal category in the U.S. grew around 2%-3% for the quarter and approximately 3% for the full year. Our category share increased approximately 20-40 basis points for the quarter and 10-20 basis points for the year. We continue to drive growth and support for our top eight brands plus Kashi, which on a combined basis grew more than 7% in the quarter and even more for the full year. North American ready-to-eat Cereal business delivered a healthy 4% internal net sales growth for the full year it was up 6% for the quarter, driven by a double digit increase in advertising. In addition, to the growth in our large brands, there were two other factors which impacted our North American cereal shipments in the fourth quarter. Firstly, as we've mentioned before we've continued to manage the tail of our portfolio axing On-the-Go and Straws because performance was not meeting expectations. Secondly, we did build our trade inventories at the end of the quarter, in preparation of January events. We believe about 2% of our fourth quarter North American cereal shipments was due to trade inventory. Our innovation and renovation pipeline is solid, Fruit Loops and Apple Jacks with Fiber hit store shelves in August plus in Mini-Wheats, Little Bites, Original Flavor, Special K Granola and Cinnabon cereal will be introduced in the first quarter. Kashi is also introducing Go Lean Crisp, two new bare naked granolas. Kellogg Canada also continued to perform well in the cereal category with share growth in both the quarter and the year. Kashi's performance was particularly strong in Canada. Turning to our North American snack business we posted a full-year internal net sales increase of 3% and 5% in the fourth quarter. On slide 17 you can see that we achieved broad based growth across our North America snack business. Our pop-tart brand is performing well, delivering mid-single digital internal net sales growth for the year. Crackers grew mid-single digits for the year driven by another strong year from Cheez-Its. In the first quarter we are launching two new SKUs of Wheatables Nut Crisps and two new SKUs of Cheez-Its. Cookies posted a slight gain for the year, driven by the fudge shop and mother's brand, and we saw some softness in the fourth quarter due to heavy promotional activity and ranging. Within snacks our best performing category was wholesome snacks, which grew double-digits for the year and achieved strong share gains. The introduction of FibrePlus, Special K Chocolaty Pretzel and Cinnabon bars helped drive wholesome snack growth for the year. Turning to the frozen and specially (inaudible) business we experienced a tough 2009. The negative trends in the food service industry and the Eggo supply disruption contributed to a 13% decline in the quarter, to finish the year down 1%. A combination of a flood and extensive enhancements and repairs at our Eggos' facilities significantly impacted production in the second half of the year. While all of our plants are operational we have not been able to achieve previous capacity levels so demand continues to exceed supply. We are evaluating our inventory plans and working hard to increase capacity, however as a result of the supply disruption the impact on the top-line will continue through the first half of 2010 and the estimated impact is included in our 2010 guidance. On a more positive note, Morning Star Farms Veggie Foods net sales grew over 3% for the year gaining over one share point, Kashi frozen meals grew over 10% for the year capturing almost 25% of the national organic meal category. Our Food Away From Home business posted lower sales for the year and the quarter, reflecting the weak economic environment and the impact that this has had on the food service industry. We don’t expect to see significant improvement in this business until the middle of 2010. Please turn to slide 19, we will discuss the international business. Outside North America our international business continues to perform well delivering 3% internal net sales growth for the year. In Europe the operating environment remains difficult. As anticipated the first half of 2009 was flat due to custom issues, but regained momentum in the back half of the year. Europe delivered 2% internal net sales growth for the year and 2% for the quarter. In the fourth quarter Europe achieved share gains in the U.K., France and Italy supported by an increase in brand impressions. Crunchy Nut and Rice Krispies in the U.K. and Extra and (inaudible) throughout the continent contributed to this growth. In Russia, we continue to transition away from bulk to higher margin packaged biscuits and cereal and we also achieved significant package share gains in those categories. However, the large reduction in the bulk business adversely impacted the overall volume picture in Europe and for the entire company. In 2010 Europe is expected to deliver low single digit sales growth, despite a continuing tough economic environment. Turning to Latin America we delivered strong results with 7% internal net sales growth for the year despite flat internal net sales in the fourth quarter. During the quarter we reduced trade inventories in Mexico and the Caribbean and experienced supply constraints in Venezuela. In Mexico we gained share growth in the quarter and the full year aided by the success of newly launched all-bran Yogofibara(ph) and a new long-target media campaign for Zucaritas. Looking to 2010, Latin America is projected to deliver mid single digits growth in internal sales, we enter the year with healthy trade inventory levels, good consumption momentum and strong commercial plans. For the full-year our Asia Pacific business delivered 5% internal net sales growth building upon last year's growth of 8%. Our businesses in South Korea, Australia and India all had strong cereal performance. In China we continue to move away from low-margin volume which impacted the fourth quarter and will continue to impact the first half of 2010. For Asia Pacific we expect to see top-line growth in the mid single digit range in 2010. And now, I'd like to turn it over to David for closing remarks. A. D. David Mackay: Thanks, John. In summary we are pleased with our 2009 performance, we entered 2010 with confidence in our business model and focus strategy, yet at the same time we are realistic, given the head winds of a volatile economy and consumers struggling under significant stress. While current conditions are unusual, we will continue to drive the business to overcome these challenges. Our financial performance of 2010 will be strong, given our cost savings and activity momentum and investments we're making. The top-line is expected to be in line with our long term guidance, and we have a clear focus to leverage the current tough environment to take advantage to build Kellogg into an even stronger company for the futures. We're planning to grow our top-line through exciting innovation and renovation and continued investment in advertizing. We're optimizing our global organization and striving for enhanced effectiveness in many areas of our business. We're off to a great start with the completion of the first year of our three year billion dollar plus challenge. We've significantly increased our investment in upfront costs which will help grow the efficiency gains, help offset commodity and energy inflation in future periods, and provide the fuel to sustain our momentum. And we will continue to reinvest heavily in the future of our business as we did in 2009. All of these elements combined with excellent financial visibility support our increased confidence that we're on track to deliver our timely rates of growth in 2010 and beyond. We've demonstrated our commitment to manage our business the right way, a long term, sustainable dependable performance. And I'd like to thank our shareholders for their continued interest in K and I'd like acknowledge and thank the K employees around the world for their dedication to the company and commitment to excellence as we begin 2010. And now I'd like to open it up to your questions.

Thank you. Ladies and gentlemen, the floor is now open for questions. (Operator's Instructions) Our first question comes from Terry Bivens of J.P. Morgan. Please state your question. Terry Bivens – J.P. Morgan: Good morning, everyone. One of the things we've been looking at you know for several years – Wal-Mart's growth has considerably outpaced that of the general grocery industry. It appears that that may be slowing down and I guess this question would be for you, Dave. They are also for the time being cleaning out Action Alley and we think really hurting some companies that depend on that for merchandising space. I'd like to get your comment on that and just what sort of effect you think that will have on your domestic volumes as we move through this year. I know you don't like to talk about individual accounts, but if we could just get some sense of how you're looking at that? A. D. David Mackay: Yeah sure Terry. I think first of all. In background perspective, if you look at North America in particular I think most retailers are feeling the impact of a degree of deflation, particularly when you look at the dairy and general produce sections and I think that's putting a lot of pressure on them. As costs rise and yet in many areas they're absolute sales are actually dropping a bit, and I think that's an area where most retailers are now looking to see how can they drive a greater efficiency and effectiveness through this supply chain and through their systems. We have been working with many of them, cutting our own SKU's looking to work with them to see where we can drive further efficiency. As far as talking about a particular retailer, I think a number of retailers have looked to clean up their stores a little bit. I think the impact of that is typically more felt in the DSD type area where you have the ability and have normally been able to build incremental displays. So where customers are cutting back on that, probably in our DSD area we're feeling it a little more than anywhere else. And most of that, we'll feel a little bit of impact of that probably through the first half and then most of the activity started mid-2009, so not material but probably a little bit of an impact. But in general terms I think when you look at the overall retail environment, very challenging given what's going on with some of the big segments being somewhat deflationary. Terry Bivens - J.P. Morgan: Okay, thanks for that. I'll pass it on.

And our next question comes from Robert Moskow of Credit Suisse. Please state your question. Robert Moskow - Credit Suisse: Thanks. I just wanted to know what your outlook is for commodity cost inflation. I don't think I quite picked it up on the call. The fourth quarter came in a little lighter than we had expected, and yet you're raising guidance for the internal operating income, so can you give us a sense of what degree that is just related to commodity costs or any kind of incremental cost savings that you're getting – why did you raise the guidance? A. D. David Mackay: Well, just specifically on commodity costs, we're expecting that our cost of goods for the year will rise about 3%, and when you look at that it's driven by employee benefits and wages, some packaging costs, sugar is at a thirty year high. You know, some things are down, some things are up so you have a lot of offsetting components in there. But you know, pension and employee costs are also in that number, and that's relatively consistent with what we saw through 2009. What was the second part of the question? Robert Moskow - Credit Suisse: I think that was the whole question. But to what degree is pension expense a benefit in 2010 on a comparison basis?

Pension expense is not a benefit as we move into 2010, this is Ron speaking. Actually we're seeing our employee related costs and specifically benefit costs increasing including pensions. Robert Moskow - Credit Suisse: So is it greater than 3% or is it around that same kind of basket level?

It's included in the 3% cost structures. Robert Moskow - Credit Suisse: Okay and then just finally. I think some of us were hoping that there would be a kind of easy comparison in the first quarter compared to trade inventory de-loading a year ago but it looks like you got a benefit from loading inventory in North America cereal and forth, so can you just give it a sense of first quarter on the comparisons? Is it still an easy comparison or is it about neutral? A. D. David Mackay: Well – I think last year there were a number of companies that did see inventory reductions at the end of the year, I think on the call when we did this call a year ago we said we hadn't seen that, our inventory levels were relatively stable, and where we expect them to be. This year however in the cereal business for a variety of reasons we did notice that in Q4 our shipments were 6% and consumption was probably around four-ish and as we looked at our inventories they were slightly higher than we believe our customers would like them to be. So on a shipment base we'll see a couple percent of what we saw in fourth quarter come out in first quarter. It's nothing more than that, making sure we manage our inventory levels to an appropriate level on behalf of our retail partners, and then the other impacts that you'll see probably in the first and second quarter for us as we mentioned the Eggo disruption which will impact through the first half, and food service probably because it started to hit us in the back half of 2009, given we're pretty much non-commercial, our food service versus the restaurant type trade. That'll have an impact through the first half too. But that's all balanced into the full year guidance of 2%-3%. Robert Moskow - Credit Suisse: Thank you very much.

Our next question comes from David Driscoll of Citi Investments. Please state your question. Cornell Burnette - Citi Investments: Good morning, this is actually Cornell Burnette calling in for David. Just wanted to ask you guys – just getting back to commodities. In your guidance, is any of that including the sell off that we've seen in the grain markets post the January 12 USDA report, or have you already been significantly hedged so you're not experiencing any of that benefit. A. D. David Mackay: Yeah, we're about 70% hedged on a global basis at this point in time, Cornell, so you know. And the markets you're talking about have bumped around from low-ish to the much higher and back down a little bit. But for us, it's never our expectation when we take hedges we'll get it perfect at the top or the bottom but we're 70% hedged, so very comfortable where we're hedged. It puts us in a good position for 2010. Cornell Burnette – Citi Investment: Okay and then another correction if may just moving on to the consumer marketing side. I noticed obviously that gross profit margins were up 350bp's in the quarter but operating margins weren't, were actually down. I now you had some higher upfront costs here at running through the SG&A line, but it also wold also seem that advertising was up significantly in the quarter. Just wondering, was a lot of that concentrated in the international markets and particularly did you witness a big bump up in advertising spending in your developing markets kind of in line with the strategy to fund future growth there? A. D. David Mackay: Yeah, well our fourth quarter advertising was up very strongly and I think that was across the board. But I think in Europe it was up very strongly as it was in Asia Pacific and Latin America but it was also up strongly in North America. So our belief in advertising is that we have to invest in our brand to sort of keep the brand equity strong, continue to reinforce the value, the quality of the products we sell. Particularly in an environment where consumers need to be reminded of these things on an ongoing basis. So we think that puts us in good stead as we head into 2010. Cornell Burnette - Citi Investment: Thank you.

Our next question comes from David Palmer of UBS. Please state your question. David Palmer - UBS Investment Research:

Hello, David, are you on the line? Okay our next question comes from Alexia Howard of Sanford Bernstein. Please state your question. Alexia Howard - Sanford Bernstein: Hello there and good morning everyone. Can I ask about the competitive dynamics in the cereal segment that you are seeing? I mean, it seems as though advertising spending is increasing quite significantly. I guess we're seeing some of the smaller competitors taking pricing downwards to try and secure their share positions. Is that the main reason that we're going to see another bump in advertising spending next year as a percentage of sales given that you are already at fairly lofty levels versus the other packaged food companies of the U.S.? A. D. David Mackay: Well, I think firstly strong advertising and brand building is a fundamental part of our beliefs that underpins our ability to drive sustainable and dependable performance, so that's something you're going to see every year. We did see significant productivity benefits in 2009 plus a lot of cost saving benefits so while you're looking at a number for the year around 7%, I mean our impressions were significantly higher. We see that as a very positive thing. The cereal category remains strong, we gained share in Q4 and for the year just a little, we did see Quaker and to a lesser extent Post come back quite heavily but you've got to remember that this has always been a competitive category, nothing unusual. And Quaker had been out of the market for the back half of 2008 because of the floods, so for them that was just a return to being in the market. And Post had had some disruptions for the first half, so they were probably just getting back into it a little too. So nothing unusual and we think the category will remain strong, it's a very positive category to be in this sort of an environment. Alexia Howard - Sanford Bernstein: That's great. Thank you very much and can I – a real quick follow-up. On the rush in bulk shipped into more packaged product, is that likely to be finished by the end of the first half of the year, or is there a time frame by which that might be completed? A. D. David Mackay: It will be ongoing. I think the magnitude we started at about mid-last year, so while it won't finish for the second half of this year, the degree of change will probably drop off. Alexia Howard - Sanford Bernstein: That's great. Thank you very much. I'll pass it on.

Our next question comes from Ken Zaslow of BMO Capital Markets. Please state your question. Ken Zaslow - BMO Capital Markets: My questions been answered, thank you.

Thank you. And our next question comes from Vincent Andrews with Morgan Stanley. Please state your question. Vincent, are you on the line? Vincent Andrews - Morgan Stanley: Sorry about that, I'm trying to juggle between a couple of calls here. My question would be – can you remind us when or what you were expecting in your fourth quarter 2009 guidance as it relates to both Eggo and then also what to place in Latin America. And then help us understand or quantify if you can what the impact will be in 2010 relative to what your guidance is? A. D. David Mackay: I think you've got two or three questions there on the Eggo supply situation in Q4. It had about a 1%-2% NSV impact on the total company for the quarter. We absorbed the OP impact into the year. For 2010 it's built into our guidance. We have said that you will see more of an impact on top line in the first half, but the OP impact is included in our guidance. On Latin America, Q4 was a difficult quarter but very understandable. There was some inventory reductions in Mexico and the Caribbean, we had some issues in Venezuela, we had massive advertising, so it was more an issue driven by those three things. For 2010 our expectation is that Latin America will continue to grow at mid-single digits, so while the quarter might look a little odd we don't have any worries about Latin America for 2010, see if growing strongly again. Vincent Andrews - Morgan Stanley: So the 4Q – I guess I'm trying to understand for Latin America if that 4Q is sort a one-off and the rate that it should grow off would be a little more normalized fourth quarter or if we should consider that the base? A. D. David Mackay: Yes, on the top line that's a one off. And the bottom line is distorted from the factors I think Ron gave you during the call. Vincent Andrews - Morgan Stanley: Okay, and then just lastly, on the Eggo piece. I just couldn't remember what was in your guidance for the fourth quarter about that and was trying to understand whether it was better or worse than what you had expected or sort of told us to expect. A. D. David Mackay: We really didn't get into a great deal of detail in the Q3 and as we went through Q4 we did see that we didn't make the improvements on restoring the capacity that we were hoping to make, and that's why for the quarter we saw net sales for the total company impacted about 1%-2%, so that's why we're being a little more specific on it now having done a lot of work and actually having arrived at a perspective for what is likely for 2010. Vincent Andrews - Morgan Stanley: Perfect, that's very helpful. Thanks a lot.

And our next question comes from Alex Patterson out of RCM. Please state your question. Alex Patterson - RCM: Just following up on Vincent's questions about the frozen business. Is it your expectation that once you have the capacity back where you wanted it that your business given your very large share in the category should sort of go back to where it was in prior periods? A. D. David Mackay: We've been working very hard to try and get back to our prior capacity levels after we had the flood and we did some enhancements and repairs, and that created a bit of the disruption. It's frustrating but we haven't been able to get back there yet. So demand currently exceeds supply. We're taking a pragmatic approach, we're evaluating our industry plans, we're going to work hard to increase capacity and we are looking to add capacity o Eggo, but that will probably take us a while. So we think 2010, it's baked into our guidance. First half there'll be impact until we lap what was a relatively soft second half. And once we're back to capacity then our expectation would be – the brand is very strong and we'll see a gradual return to the prior levels but forecasting where exactly that will be, Alex, I think is a bit premature. Alex Patterson - RCM: Okay, so just so I understand. You're forecasting that your capacity will be back online to normal levels by the middle of the year, roughly speaking. A. D. David Mackay: More towards the end of the year if we're being pragmatic. We'd like to think mid-year but we're taking the view that it may be later than that. Alex Patterson - RCM: Okay, I understand now. So then on your gross margin outlook overall, you've got a cost of goods 3% outlook and then you've got a productivity that should probably exceed that, implying a good chunk of your gross margin increase source. Does that sort of paint a picture of pricing environment where you expect to be able to be a little more, I don't know promotional as need be, or more volume oriented than necessarily price mix oriented? A. D. David Mackay: I think the environment for 2010 probably we'll see minimal pricing. It depends region to region of the world. We are seeing inflation at higher levels in some parts of the world than others like Latin American. But in general terms on a global basis I think there will be minimal pricing so you know volume and mix will be more important, but that's why is essence you know we are giving guidance at our long term and top line range of 2%-3%, low single digits. Alex Patterson - RCM: Okay and then just Venezuela – you guys didn't really spell out the impact for 2010 in terms of hyper-inflationary accounting.

We're actually happy with our underlying business performance in Venezuela. It's only 1%-2% of our sales and profits as I mention before, we took a $0.02 hit in the fourth quarter. We did convert over to the parallel rate for translation of our profits in 2010, and that has impacted our earnings per share performance and I commented on that in terms of the currencies impact to earnings per share. It's roughly half of the $0.08 we declined so approximately four pennies. Our underlying business performance, the underlying growth will be just fine we do expect growth in Venezuela over the course of 2010. A. D. David Mackay: I think the only other comment on Venezuela is, you know it's a volatile situation. We're watching it carefully. We did have some display of disruptions to supply in the fourth quarter because there wasn't electricity and all of the raw materials we needed we couldn't necessarily access, so we've got a very strong watching brief on Venezuela and really to Ron's point, it did take our FX upside to 10 which we saw would be $0.08 and wiped out $0.04 of it in moving to the parallel rate, but that's all built into the guidance we've given today. Alex Patterson - RCM: Great, thanks very much.

Our next question comes from Ed Aaron of RBC Capital Markets. Please state your question. Edward Aaron - RBC Capital Markets Corp.: Thanks for taking my question. In the North America cereal business, do you think it's prudent to expect that sales there in the first quarter will be up year over year, just when you consider the inventory build in Q4, the full lapping of the price increases and then I think you also have a tougher market share comparison there. So I'm just trying to get a little bit more clarity on how you'd manage expectations just around, kind of next quarter. A. D. David Mackay: We'd expect growth in the first quarter. It will be modest given the fact that we are pulling down our inventories from year end through the quarter so you know, I'm not going to give you a number, but modest growth. Edward Aaron - RBC Capital Markets Corp.: That's helpful, thank you . And then on the Eggo waffle issue you mentioned the 1%-2% sales impact on the fourth quarter. Would you be able to give us sort of a flow through assumption on that, just so we can get a better sense on what the EPS impact might have been on the quarter there. A. D. David Mackay: No, we absorbed it into our results for 2009 and we've got it covered in 2010. Edward Aaron - RBC Capital Markets Corp.: Okay, thanks, and then one more quick one if I could. At your analyst day in November you talked about a lot of seeing rationalization that took place in North America in 2009. I'm just trying to understand how to think about what that does from a sales comparison perspective and how much volume growth we might pick up in 2010, just given the fact that you're re-lapping against that pruning from 2009? A. D. David Mackay: Yeah, the pruning is basically from about mid-2009 and will be completed by mid-2010 so you're going to have some impact in the first half. I don't think major. And really when we look at that we think that was a very proactive move to try and simplify our portfolio as our retail partners are looking to simplify theirs and manage what was a complex and tough environment from their perspective. Nothing major, a bit of an impact on the first half, but nothing worth really calling out. Edward Aaron - RBC Capital Markets Corp.: Thank you.

Our next question comes from Judy Hong of Goldman Sachs. Please state your question. Judy Hong - Goldman Sachs: Thanks, good morning everyone. Dave, I just wanted to go back to the question about the odd spending and the competitive dynamic, because in 2009 clearly you've talked about the efficiencies and the productivities that you've gained and the ad side and there's a media deflation that's helped you as well. But at the same time you've also seen some of your competitors really take spending up in a pretty significant way. So I'm just wondering, if you think about 2010 you talked about ad spending growing faster than sales growth, but how meaningful does ad spending have to step up again, especially now that you're lapping the media deflation that you probably got in 2009 as well? A. D. David Mackay: Judy, firstly our view is in a couple of major markets we are going to see deflation, you know mid to high single digits. And that's built into our expectations, so while advertising will be above sales our impressions will be significantly enhanced by that assumption that we're very comfortable with. So again, when you look at the base dollar spend, if you take 2009, I mean you could add , 5%-8% from our dollar spend to our true impressions and therefore in-market impact, and likewise for 2010. That deflation is really going to help us get a lot more impressions for a much lower cost. Our view is that – I think strategic approach of investing behind your brands in this sort of market is clearly one that most other major branded companies are recognized support that they're trying to catch up on. Judy Hong - Goldman Sachs: I guess it's more just on the relative spending side. Because I mean, clearly even with media deflation you've seen your competitors raise spending much more in 2009 and at the same time your sales growth sort of slowing down, albeit within your long term target, I mean you were doing internal sales growth mid to high single digits and it seems like that slowed down. And I'm wondering whether you think there's any correlation to your ad spending maybe not being as much up as some of your competitors. A. D. David Mackay: No, I don't think so. I mean, you look at our performance on sort of the cereal category. We grew share for the year, we released share in the quarter. The category was strong so to the extent that other branded competitors were increasing their spend, that's positive for the category. It's not like you can segment. You take your advertising up more than the other guy you're going to get share, it's a healthy thing for the category, it's a positive dynamic for all of us in my view. Judy Hong - Goldman Sachs: Okay, thank you.

Our next question comes from Eric Katzman of Deutsche Bank. Please state your question. Eric Katzman - Deutsche Bank: Hi, good morning everybody. Two just detailed ones and then a broader picture one. The interest expense hit from the refinancing, how much was that?

Approximately seven pennies. Eric Katzman - Deutsche Bank: Seven cents, okay. And then the charitable contribution in the other income line, how much was that?

Approximately four pennies. Eric Katzman - Deutsche Bank: Four pennies. Okay. And then the – I guess the broader question. Can you help me understand why, maybe this follows up a little on Judy's question, but why SG&A as percentage of sales in the quarter was so high? You know, you've been running roughly 26%, 27% of sales and yet this quarter it jumped to close to 30 %, 31%. What's happening there and do you think that's kind of what – well just why don't we go there?

There are really two key items there Eric. First is, in recollect we had indicated on previous calls that we were going to increase our advertising investment double digit in the back half of the year. Eric Katzman - Deutsche Bank: Yeah, but we've been doing that forever so I'm not buying that one.

But those are the results. I mean we increased our advertising significantly in the fourth quarter and in addition to that our up-front costs were up significantly as well. It was the highest investment we had in upfront costs within ST&A. Eric Katzman - Deutsche Bank: I try to look at it excluding the upfront costs so I'm getting clearer picture, and not getting the swings from that. And even excluding that, it's still up significantly. So is that the Venezuela absorption, is that the hit from Russia, which is surprisingly large, I'm not sure why that keeps coming back for such a small acquisition. I don't understand.

It doesn't have anything to do with Venezuela or Russia. It's really the advertising and the upfront costs that are driving the performance. A. D. David Mackay: Eric, I think what's happening a little bit is the upfront costs this year were – in the fourth quarter, one it was the highest quarter of the year for upfront costs and secondly it was largely in the SG&A line. \Which is a bit different to prior quarters in prior years. And also the advertising increase year on year is significant, it's about half the increase in the SG&A margin for all SG&A sales for this quarter. Now whatever advertising we spent in the fourth quarter wasn't so different to any other quarter in the year, but our sales base is lower in the fourth quarter because to seasonality and so it distorts the SG&A margin line. Eric Katzman - Deutsche Bank: All right. Maybe I'll follow up, but I'll pass it on. Thanks.

Okay, one more question.

Okay and our last question comes from Chris Growe of Stifel Nicolaus. Please state your question. Chris Growe - Stifel Nicolaus: Hi, good morning. I just wanted to ask you. Looking at a little softer volume picture here for the company, and I'm just curious when you look at 2010, to the extent that you have big increase in advertising that occurred this year and it looks like it will occur again next year. What else is it you're doing to drive volume growth? The categories look like they're doing okay, but at the same time, new productivity is a little soft this year in 2009, is that picking up into 2010? Or perhaps, what are the levers that we should look at to judge your volume growth in 2010? John A. Bryant: Chris, let me just clarify a little bit on volume in 2009 and then I'll hand it back over to David to talk about 2010, and I think Eric just raised this as well in terms of the impact of Russia. IF you look at volume in the fourth quarter we were down slightly, and the three big \drivers of that were actually China, Russia and frozen. In both China and Russia we're trying to move our business to a higher margin to premium packaged foods business from lower margin or bulk business in some of those markets. What that is doing actually means that we are moving away from some pretty big chunks of volume. And then of course, the frozen issue of Eggo disruption impacted our volume. If you could strip those out, our volume was actually very healthy in the quarter, in fact our cereal volume was up 3%-4% in the course, so we've seen good volume in the core of our business. There's some (inaudible) around the edges which is distorting volume. So we actually feel good about our volume performance. A. D. David Mackay: Yeah, I think if you look at 2010, we'll see a volume grow, a little bit of mix, much lower levels of pricing, just as a result of what's going on with commodity and cost increases, so that's why when you look at our guidance of 2-3 being more in line with our top line it does reflect the fact that the pricing impact is going to be significantly lower, and it's been for probably the last three to four years. Chris Growe - Stifel Nicolaus: Okay, that's helpful. I guess it's good to get a little bit of perspective on how big those drags on the quaternion could have been because that seems like it could have been a bigger driver than any of us expect. A. D. David Mackay: Yes, that could have been. We'll probably come back and give you a bit more color on that (inaudible) Just to give you a sense of what's happening there. Chris Growe - Stifel Nicolaus: And then just one last one relative to your share repurchase activity. You've got a lot to do in the year, your debt level is down to a much lower level. Should we expect a pretty ratable amount of share repurchase throughout the year, are you trying to do any kind of one big, one time share repurchase for the year?

You should expect it to be ratably over the course of the year, in fact we've already started some share repurchase at the beginning of the year. Chris Growe - Stifel Nicolaus: Okay, great, thank you.

Well thank you everybody for joining us today. Please feel free to call me with follow up questions and we'll see you all in a couple weeks at Cagney.

Thank you. Ladies and gentlemen, this does conclude today's teleconference. We thank you for your participation.