General Mills today (19 March) confirmed a fall in underlying profits in its third quarter, with the Yoplait yoghurt and Old El Paso meal kits maker pointing to pressure on sales in the US.
Adjusted diluted earnings per share, excluding factors including commodity positions, the devaluation of the Venezuelan bolivar and the costs of integrating Brazilian firm Yoki, hit US$0.62 for the 13 weeks to 23 February, down $0.66 a year earlier.
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General Mills pre-warned the market last week its earnings per share could reach $0.61-0.62, below analyst consensus expectations of $0.68 a share.
The US food group today reported a 10% fall in adjusted segment operating profit to $690m.
Net sales slid 1% to $4.38bn. Foreign exchange translation reduced net sales by one percentage point. General Mills said “net price realisation and mix” boosted net sales by a point, although while lower pound volume reduced sales by the same amount.
General Mills also cited “generally weak food industry trends” and the impact of increased investment in its US yoghurt business.
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By GlobalDataChairman and CEO Ken Powell said: “This year’s severe winter weather dampened sales performance across the food industry, and third-quarter results for our US retail and convenience stores and foodservice segments reflect that disruption.
“International segment results were stronger, with constant-currency sales gains in every region including double-digit growth in both Asia-Pacific and Latin America.”
He added: “We anticipate strong double-digit growth in adjusted diluted EPS for the final quarter of fiscal 2014. Our quarterly input cost inflation is expected to be well below year-ago levels.”
