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General Mills Inc. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: March 21, 2012 04:04PM

General Mills Inc. (GIS) filed Quarterly Report for the period ended 2012-02-26. Genl Mills has a market cap of $25.03 billion; its shares were traded at around $38.58 with a P/E ratio of 15.7 and P/S ratio of 1.7. The dividend yield of Genl Mills stocks is 3.1%. Genl Mills had an annual average earning growth of 8.3% over the past 10 years. GuruFocus rated Genl Mills the business predictability rank of 5-star.



Highlight of Business Operations:

Cost of sales increased $397 million from the third quarter of fiscal 2011 to $2,613 million primarily driven by a $252 million increase attributable to higher volume and a $158 million increase attributable to higher input costs and product mix. In the third quarter of fiscal 2012, we recorded a $46 million net decrease in cost of sales related to the mark-to-market valuation of certain commodity positions and grain inventories compared to a net decrease of $33 million in the third quarter of fiscal 2011.

Net earnings attributable to General Mills were $392 million in the third quarter of fiscal 2012, consistent with last year. Diluted EPS was $0.58 in the third quarter of fiscal 2012, down 2 percent from $0.59 last year. These results include the effects from the mark-to-market valuation of certain commodity positions and grain inventories and integration costs resulting from the acquisitions of Yoplait S.A.S. and Yoplait Marques S.A.S. Diluted EPS excluding these items affecting comparability, a non-GAAP measure used for management reporting and incentive compensation purposes, was $0.55 in the third quarter of fiscal 2012, down 2 percent compared to $0.56 in the third quarter of fiscal 2011 (see the “Non-GAAP Measures” section below for our use of this measure and our discussion of the items affecting comparability).

For the nine-month period ended February 26, 2012, net sales grew 12 percent to $12,592 million including 6 percentage points contributed by the acquisition of Yoplait S.A.S. Total segment operating profit of $2,275 million essentially matched the nine-month period ended February 27, 2011. Diluted EPS of $1.86 was down 16 percent and diluted EPS excluding certain items affecting comparability of $1.96 was consistent with the nine-month period ended February 27, 2011. (See pages 33-34 for a discussion of measures not defined by GAAP).

Cost of sales increased $1,386 million from the nine-month period ended February 27, 2011, to $8,043 million primarily driven by a $587 million increase attributable to higher volume and a $580 million increase attributable to higher input costs and product mix. In the nine-month period ended February 26, 2012, we recorded an $86 million net increase in cost of sales related to the mark-to-market valuation of certain commodity positions and grain inventories compared to a net decrease of $133 million in the nine-month period ended February 27, 2011.

Net earnings attributable to General Mills were $1,242 million in the nine-month period ended February 26, 2012, down 16 percent from $1,478 million in the same period last year. Diluted EPS was $1.86 in the nine-month period ended February 26, 2012, down 16 percent from $2.22 last year. These results include the effects from the mark-to-market valuation of certain commodity positions and grain inventories, integration costs resulting from the acquisitions of Yoplait S.A.S. and Yoplait Marques S.A.S., and the net benefit from two uncertain tax matters in fiscal 2011. Diluted EPS excluding these items affecting comparability, a non-GAAP measure used for management reporting and incentive compensation purposes, of $1.96 matched the same period of fiscal 2011 (see the “Non-GAAP Measures” section below for our use of this measure and our discussion of the items affecting comparability).

Read the The complete Report



Stocks Discussed: GIS,
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