Int’l Sales, Acquisitions Boost General Mills Profits
Thanks in large part to recent global growth, General Mills, Inc., reported a 22 percent jump in second-quarter profits—beating Wall Street expectations.
The Golden Valley-based food giant’s profits totaled $541.6 million, or 82 cents per diluted share, for the quarter that ended November 25—up from $444.8 million, or 67 cents per diluted share, for the same period last year.
Analysts polled by Thomson Reuters expected 79 cents per share.
Net sales for the quarter, meanwhile, grew 6 percent to $4.88 billion, up from $4.62 billion for last year’s second quarter.
International sales were particularly strong, having grown 19 percent to reach $1.38 billion. The increase was driven in part by sales from General Mills’ Yoki Alimentos business in Brazil, which it acquired on August 1 for $939.8 million. (Yoki makes snacks, dry soups, side dishes, seasonings, and other products.) Yoplait yogurt’s Canada operation also contributed.
U.S. sales, meanwhile, grew 2 percent to $2.98 billion in the second quarter. General Mills said that the snacks and meal divisions recorded gains, and net sales of frozen foods were essentially flat. However, sales of Yoplait yogurt, cereal, and baking products declined.
Among the new products that made the strongest contributions to second-quarter sales: Yoplait Greek and Greek 100 calorie yogurts, Nature Valley protein bars, and Peanut Butter Multigrain Cheerios. Meanwhile, established brands that helped fuel growth are Lucky Charms, Chex cereals, Fiber One 90-calorie snack bars, Totino’s frozen snacks, and Pillsbury refrigerated crescent rolls.
Through the first six months of fiscal 2013, General Mills’ sales grew 5 percent to $8.93 billion.
Following the positive sales results, the company slightly increased its outlook for the full fiscal year. It now expects diluted earnings per share of between $2.65 and $2.67 per share—up from a solid $2.65 per share that was previously anticipated.
On Wednesday, in addition to announcing quarterly earnings, General Mills also announced the new products it plans to introduce in the second half of the 2013 fiscal year. Among them: Honey Nut Cheerios Medley Crunch, Fiber One 80 Calories Chocolate, Peanut Butter Toast Crunch, Fiber One protein bars in caramel nut and coconut almond flavors, Green Giant-branded veggie chips, and new flavors of Totino’s Pizzeria Rolls.
Shares of General Mills’ stock closed down about 1.2 percent at $41.27 on Wednesday.
General Mills is among Minnesota’s 15-largest public companies based on revenue, which totaled $16.7 billion in fiscal 2012.