General Mills (GIS) revealed a slightly better-than-expected fourth-quarter profit on Wednesday but a fiscal 2013 earnings outlook that fell short of the consensus, sending its shares down more than 2.3%.
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The cereal and snacks giant reported net earnings of $325.4 million, or 49 cents a share, compared with a year-earlier $320.2 million, or 48 cents.
Excluding one-time items, earnings were 60 cents per share, a penny ahead of average analyst estimates in a Thomson Reuters poll.
Revenue for the three months ended May 27 climbed 12% to $4.06 billion from $3.6 billion a year ago, missing the Street’s view of $4.11 billion.
For fiscal 2012, General Mills earned $2.35 a share on sales of $16.7 billion, below average analyst estimates of $2.54 a share and matching the Street’s view on sales.
The results come a day after the Progresso soup maker said it was raising its quarterly dividend by 8% to 33 cents a share.
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The company’s shares have fallen nearly 8% so far this year, leading the Minneapolis food giant to launch a productivity and cost savings plan in May that may cut up to 850 global jobs.
General Mills CEO Ken Powell said the year brought the highest input-cost inflation in more than three decades and a slow economic recovery that put pressure on consumer budgets.
The company took strategic actions during the year to strengthen its portfolio, Powell said, including increasing advertising investments as well as new products and acquisitions such as Yoplait, India spice company Parampara and Brazilian packaged-food maker Yoki that expands its presence in emerging markets.
Sales for its Big G cereal division grew 4% to $2.4 billion with the help of existing cereal like Cheerios, Cinnamon Toast Crunch and Chex, and new products like Fiber One and Nature Valley.
Looking ahead, General Mills said it expects 2013 to be “another year of good growth,” reflecting sales and profit increases from its base business and new operations. The company plans to continue boosting marketing spending in U.S. yogurt and other selected product lines, while accelerating growth in emerging markets, particularly China.
However, its earnings estimate fell short of expectations. General Mills sees fiscal 2013 earnings of $2.65 a share, below the $2.75 forecasted by analysts.