Vending

General Mills boosts Q4 and FY results, surpassing expectations

Image provided by iStock.

June 29, 2022

General Mills Inc. surpassed analyst expectations for its Q4 and FY 2022 financial results, boosting sales and earnings, according to an earnings release. Highlights include:

• Net sales increased 8% from $4.5 billion in Q4 2021 to $4.9 billion for the quarter ending May 29, 2022, including a four-point net headwind from divestiture and acquisition activity and one point of unfavorable foreign currency exchange. Organic net sales increased 13%.
• Net earnings rose 97% from $416.8 million to $823 million in the comparable quarters.
• Diluted EPS jumped 98% from 68 cents to $1.35, driven primarily by higher operating profit and lower average diluted shares outstanding.
• Adjusted diluted EPS rose 23% from 91 cents to $1.12, driven primarily by higher adjusted operating profit and lower average diluted shares outstanding.
• For the full year, net sales increased 5% from $18.13 billion to $19 billion, including a one-point net headwind from divestiture and acquisition activity. Organic net sales increased 6%.
• For the full year, net earnings rose 17% from $2.35 billion to $2.7 billion.
• Diluted EPS for the full year was up 17% from $3.78 to $4.42, primarily reflecting higher operating profit, a lower effective tax rate and lower average diluted shares outstanding.
• Adjusted diluted EPS for the full year rose 4% from $3.79 to $3.94 in constant currency, driven primarily by higher adjusted operating profit, lower net interest expense and lower average diluted shares outstanding, partially offset by lower non-service benefit plan income.
• Fourth-quarter net sales for General Mills' North America retail segment increased 11% to $3 billion, driven by favorable net price realization and mix, partially offset by lower pound volume.
• For the full year, North America retail sales increased 3% to $11.6 billion.
• Fourth-quarter net sales for the North America foodservice segment increased 25% to $526 million, driven by favorable net price realization and mix.
• For the full year, North America foodservice net sales increased 24% to $1.8 billion.

Shares traded at $74 today against a 52-week range of $56.67-$74.27.

The $4.9 billion in quarterly revenue beat analyst expectations by $80 million while the non-GAAP EPS of $1.12 beat expectations by 11 cents, according to Seeking Alpha.

The company declared a 54 cents per share quarterly dividend, marking a 5.9% increase from the prior 51 cents dividend.

"Fiscal 2022 was another successful year for General Mills, marking the fourth consecutive year that we've delivered results that met or exceeded our targets for top and bottom line growth and cash generation," Jeff Harmening, CEO and chairman, said in the press release. "Though significant inflation and supply chain disruptions put pressure on our margins, we responded quickly to address those challenges and keep our brands on shelf for our customers and consumers."

General Mills expects the largest factors impacting its performance in fiscal 2023 will be the economic health of consumers, the inflationary cost environment and the frequency and severity of disruptions in the supply chain.