US food manufacturer General Mills said fiscal Q3 and full-year profits will fall short of earlier forecasts. US sales slowed as it hooked up its sales teams with those of Pillsbury, which it acquired from UK drinks major Diageo in October for US$10.4bn. Profits in the quarter ending this month will be between 27 and 29 cents per share, on sales volumes down by 3-4%.
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This represents a steep decline on the expected profit figures, which General Mills in December forecast at 40-44 cents before one-time items. Sales were expected to ease up by a low single-digit percentage.
Going forward, sales improved in January and are expected to increase further this month, the company said.
Analysts have warned that integrating Pillsbury might not be straightforward as its business became sluggish during the 15-month waiting period before the Federal Trade Commission gave the deal the green light.
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