General Mills Inc. Reports Operating Results (10-Q)
General Mills, Inc. has a market cap of $25.44 billion; its shares were traded at around $40.02 with a P/E ratio of 15.4 and P/S ratio of 1.5. The dividend yield of General Mills, Inc. stocks is 3.4%. General Mills, Inc. had an annual average earning growth of 7.3% over the past 10 years. GuruFocus rated General Mills, Inc. the business predictability rank of 4.5-star.
Highlight of Business Operations:For the first quarter of fiscal 2013, net sales grew 5 percent to $4,051 million including 6 percentage points contributed by acquired businesses, primarily Yoplait S.A.S. Total segment operating profit of $769 million was 6 percent higher than the first quarter of fiscal 2012. Diluted earnings per share (EPS) of $0.82 was up 34 percent and diluted EPS excluding certain items affecting comparability of $0.66 increased 3 percent compared to the first quarter of fiscal 2012 (see the Non-GAAP Measures section below for our use of this measure and our discussion of the items affecting comparability).
Cost of sales increased $22 million from the first quarter of fiscal 2012 to $2,423 million. Higher volume drove a $241 million increase in cost of sales partially offset by a $99 million decrease attributable to product mix. In the first quarter of fiscal 2013, we recorded an $82 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 increase of $38 million in the first quarter of fiscal 2012.
Selling, general, and administrative (SG&A) expenses increased $31 million to $839 million in the first quarter of fiscal 2013 versus the same period in fiscal 2012. The increase in SG&A expenses was primarily driven by two additional months of activity from Yoplait S.A.S. in fiscal 2013 as compared to fiscal 2012. SG&A expenses as a percent of net sales in the first quarter of fiscal 2013 were down 30 basis points compared with fiscal 2012. Media and advertising expense decreased 7 percent compared to fiscal 2012.
Net earnings attributable to General Mills were $549 million in the first quarter of fiscal 2013, up 35 percent from $406 million last year. Diluted EPS was $0.82 in the first quarter of fiscal 2013, up 34 percent from $0.61 last year. These results include the effects from the mark-to-market valuation of certain commodity positions and grain inventories, restructuring charges reflecting employee severance expense related to our 2012 productivity and cost savings plan, and a reduction to income taxes related to the restructuring of our GMC subsidiary. Diluted EPS excluding these items affecting comparability, a non-GAAP measure used for management reporting and incentive compensation purposes, was $0.66 in the first quarter of fiscal 2013, up 3 percent compared to $0.64 in the first quarter of fiscal 2012 (see the Non-GAAP Measures section below for our use of this measure and our discussion of the items affecting comparability).
During the first quarter ended August 26, 2012, our operations generated $489 million of cash compared to $441 million in the same period last year. The $48 million increase is primarily due to an increase in net earnings partially offset by a decrease in deferred income taxes, primarily the $67 million reduction as a result of the restructuring of our GMC subsidiary. Changes in current assets and liabilities were consistent with the same period last year including an increase in grain inventory balances partially offset by an increase in accounts payable balances primarily due to extended payment terms.
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