General Mills today (29 June) revealed that its profits for the fourth quarter declined by 52% on the fourth quarter of last year primarily because, the company said, last year’s results were inflated by gains from divestures.

The maker of branded food products such as Cheerios, Luck Charms, Betty Crocker and Pillsbury reported earnings of US$222m, or $0.62 per share, for the quarter – down from $460m, or $1.14 per share last year. Sales for the quarter increased by almost 5% to $2.85bn.

For the full year, the company reported net sales gains of 4%, outpacing 2% growth in unit volume, up to $11.6bn. Segment operating profits increased by 5% to $2.1bn.

General Mills announced FY diluted EPS of $2.90, which, the company said, exceeded its targeted range. This included a $0.08 charge per share to account for dilution from convertible bonds.

Net earnings and diluted EPS were below the prior year’s reported results, which included a $284m after-tax gain from the divestitures of Lloyd’s refrigerated meats and the company’s interest in a European snacks joint venture, the company said.

Chairman and CEO Steve Sanger said: “Our fourth-quarter results were solid, with both sales and operating profit up 5%. For the year in total, all three of our operating segments achieved net sales gains and even stronger growth in operating profits. We coupled this good growth with improving returns on invested capital  And we returned nearly $1.4bn in cash to shareholders through increased dividends and renewed share repurchases.”