General Mills has reported its first quarter results. Net sales declined 4% to $3.8 billion; organic net sales also declined 4%. Operating profit declined 3%; total segment operating profit was down 16%.
General Mills has reported its first quarter results. Net sales declined 4% to $3.8 billion; organic net sales also declined 4%. Operating profit declined 3%; total segment operating profit was down 16% in constant currency. Diluted earnings per share (EPS) increased 3% to $0.69; adjusted diluted EPS totalled $0.71, down 9% in constant currencyThe company reaffirmed its 2018 full-year outlook including organic net sales down 1 to 2%, constant-currency total segment operating profit between flat and up 1%, an increase in adjusted operating profit margin, and adjusted diluted EPS up 1 to 2% in constant currency"Our number one priority in fiscal 2018 is strengthening our topline performance," said General Mills Chief Executive Officer Jeff Harmening. "Our first-quarter net sales finished in line with our expectations, and our focus on our global growth priorities drove important improvement in our retail sales trends. This included a 300 basis point improvement in the U.S., with better results in each of our top 5 categories. We anticipated a slow start to the year on the bottom line, and we continue to expect sequential improvement in profitability in the coming quarters.”“Looking ahead, we're taking deliberate steps through innovation, brand building, and increased organizational agility to position the company for long-term top- and bottom-line growth, in line with our shareholder return model." For fiscal 2018, the company has identified four global growth priorities: 1) growing cereal globally, including CPW; 2) improving U.S. yogurt through innovation; 3) investing in differential growth opportunities including Häagen-Dazs ice cream, snack bars, Old El Paso Mexican food, and its portfolio of natural and organic food brands; and 4) managing Foundation brands with appropriate investment. By directing resources toward these global priorities, General Mills says it expects to drive a 200 to 300 basis point improvement in its organic net sales trends in fiscal 2018, which represents an important step in returning the business to consistent organic net sales growth.