General Mills has posted a 6% rise in full-year profits despite higher input costs and an increase in marketing spending.
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Operating profit rose to US$2.4bn and net earnings increased 13% to $1.3bn. EPS, excluding one-offs, increased 11% to $3.52 for the year ended 25 May.
Sales in fiscal 2008 were up 10% to $13.5bn, the company revealed today.
“Fiscal 2008 was a strong year for General Mills. Sales and operating profit grew for all three of our major business segments. We posted particularly good growth in the fourth quarter, and we’ve carried momentum into the start of 2009,” chairman and CEO Ken Powell said.
In the fourth quarter, sales increased 13% to $3.5bn on increased volumes and higher pricing. Segment operating profits were up 5% to $517m, despite higher costs and a 20% increase in marketing expenditure in the quarter.
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By GlobalDataHowever, fourth-quarter net earnings dropped 17% to $185.2m after gains from commodities trading declined.
Looking to next year, the US cereal manufacturer said it anticipated sales and earnings gains despite an estimated 9% increase in supply-chain costs.
“Net sales are expected to grow at a mid single-digit rate, driven primarily by price and mix. Segment operating profits are also expected to grow at a mid single-digit rate, in line with our long-term model,” Powell said.
