When we last checked in with snacks-and-cereal maker Kellogg (NYSE: K), quarterly results were bland. At first glance, things seem to have really turned around at the home of Tony the Tiger, although our Fool decoder ring reveals a somewhat different story.

First-quarter sales gained 5%, to $3.3 billion. Excluding favorable currency effects, sales rose 2%.

Compared to the year-ago period, volume, as measured by tonnage, inched up by 0.5%, and product price/mix contributed another 1.3% to sales growth. Tonnage showed a nice improvement from the prior quarter, but the real highlight awaited on the bottom line.

Earnings per share of $1.09 represented a 30% year-over-year jump. That far outshines the most recent quarterly EPS growth turned in by key competitor General Mills (NYSE: GIS).

However, if we adjust for a lower tax rate in this year's first quarter, and a one-time loss last year, EPS growth falls to a more modest 17%. Don't get me wrong; that's still impressive, particularly because the gain came not just from lower commodity costs, but also from productivity savings.

Goings-on in the company's North American segment revealed interesting insights into the U.S. consumer, not to mention the competitive landscape among consumer-staples companies. First, the retail snacks category posted organic sales growth of 5%, which suggests that consumers are loosening their wallets for nonessential purchases.

At the same time, retail cereal eked out only a 0.5% gain in organic sales, partially because of increased competition. According to one analyst, cereal maker Ralcorp Holdings (NYSE: RAH) is trying to win back market share.

Also, Kellogg management reported that products are selling faster in dollar and club stores than in regular grocery channels. That obviously bodes well for the likes of Costco (NYSE: COST), Dollar General (NYSE: DG), and Family Dollar (NYSE: FDO), all of which sell Kellogg items. But it also suggests that consumers are looking for the best possible deal, even as they once again buy "fun foods" such as cookies and other snacks.

And that, in turn, casts a shadow on future sales growth among the full range of consumer-staples names.

Fortunately, Kellogg's got a grade-A cost-savings program in full swing. Plus, management just announced a $2.5 billion three-year stock buyback program, which, at today's prices, represents more than 10% of market cap.

That should help the company achieve its long-term target of high single-digit EPS growth (excluding currency). At a forward price-to-earnings ratio of 14, shares don't represent a grr-rr-reat value, but investors who buy at today's prices should do reasonably well.

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Fool contributor Mike Pienciak holds no financial interest in any company mentioned in this article. The Fool has a disclosure policy.