General Mills 3Q Net Income Climbs On Snack Sales
MINNEAPOLIS (AP) — General Mills Inc.’s fiscal third-quarter net income rose 18 percent as it sold more snacks and benefited from strength overseas.
The maker of Nature Valley snack bars and Cheerios cereal also maintained its 2011 adjusted earnings and revenue outlooks Wednesday.
General Mills earned $392.1 million, or 59 cents per share, for the period ended Feb. 27. That compares with $332.5 million, or 48 cents per share, a year earlier.
Adjusted earnings were 56 cents per share, matching the expectations of analysts surveyed by FactSet.
The Minneapolis food company, which is in exclusive talks to buy a majority stake in French yogurt maker Yoplait, said revenue climbed 2 percent to $3.65 billion. Wall Street forecast $3.7 billion.
Revenue for the snack division increased 14 percent, with Nature Valley and Fiber One snack bars among its strongest performers.
Revenue from Yoplait yogurt, which General Mills makes in the U.S. under license from the French company, rose 1 percent.
The company also saw solid results from its Small Planet Foods natural and organic unit, with revenue up 14 percent. Revenue for the bakeries and foodservice division rose 9 percent.
General Mills’ international revenue climbed 8 percent to $688 million, powered by strength in the European and Asia/Pacific regions.
Those increases helped offset weak Big G cereal revenue, which fell 6 percent because it introduced fewer new products.
Looking ahead to the fourth quarter, Chairman and CEO Ken Powell said in a statement that General Mills expects the period to include its “highest earnings growth of the year.” Powell expects higher prices will help partly offset rising commodity costs.
The food maker said it raised prices in several product categories, including flour, frozen vegetables, in January.
While the company had benefited during the economic downturn from more Americans eating at home more often, in recent months it has had to deal with rising costs for ingredients such as grain.
General Mills still expects 2011 adjusted earnings of $2.46 to $2.48 per share. Analysts predict $2.48 per share.
The company is also keeping its forecast for a low-single-digit percentage increase in full-year revenue.
(© Copyright 2011 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)