General Mills Q3 Profit Tops Estimates, Organic Sales Down 5%; Reaffirms Outlook
WASHINGTON (dpa-AFX) - General Mills (GIS) reported third-quarter adjusted EPS of $0.72, up 11 percent from the prior year.
Constant-currency adjusted EPS increased 8 percent. On average, 14 analysts polled by Thomson Reuters expected the company to report profit per share of $0.71, for the quarter. Analysts' estimates typically exclude special items.
Third-quarter total segment operating profit was $662 million, down 2 percent year-over-year in constant currency. Net earnings attributable to General Mills decreased 1.1% to $358 million. Earnings per share was $0.61, up 3 percent, driven by a lower tax rate and 3 percent fewer average diluted shares outstanding.
Third-quarter reported net sales declined 5 percent to $3.79 billion. Organic net sales also declined 5 percent, primarily reflecting volume reductions in the North America Retail segment partially offset by benefits from positive net price realization and mix. Analysts expected revenue of $3.82 billion, for the quarter.
Third-quarter net sales for General Mills' North America Retail segment totaled $2.50 billion, down 7 percent from the prior year, driven primarily by double-digit declines in the U.S. Meals & Baking and U.S. Yogurt operating units. Organic net sales declined 8 percent.
General Mills CEO Ken Powell, said: "Our third-quarter results finished in line with our expectations and keep us on track to deliver the guidance we updated last month. Our net sales declined due primarily to gaps in pricing and promotional activity in key U.S. businesses. Our cost savings efforts helped us expand our adjusted operating profit margin and drive growth in adjusted diluted EPS. Looking ahead, we are highly focused on improving our topline performance while continuing to expand our margins."
General Mills reaffirmed its key full-year fiscal 2017 targets. The company continues to expect: organic net sales to decline approximately 4 percent; constant-currency total segment operating profit growth to be in a range of down 1 percent to up 1 percent; and constant-currency adjusted EPS to increase 5 to 7 percent from the base of $2.92 earned in fiscal 2016. The company estimates currency translation will have an immaterial impact on fiscal 2017 adjusted EPS.
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