Cereal maker General Mills (GIS) posted a 35% increase in first-quarter earnings and higher year-over-year sales on Wednesday, led by the acquisition of Yoplait and other snacks businesses, as well as new products.
The company, which introduced new snacks like Apple Cinnamon Chex and Nature Valley Protein Bars last quarter, reported net earnings of $549.9 million, or 82 cents a share, compared with a year-earlier $405.6 million, or 61 cents.
Excluding one-time items, Minneapolis-based General Mills earned 66 cents, topping average analyst estimates of 62 cents in a Thomson Reuters poll.
Revenue for the three months ended Aug. 26 climbed 5% to $4.05 from $3.85 billion a year ago, narrowly below the Street’s view of $4.08 billion, however the company said the performance has put it on track to meet 2013 targets.
“Results for the first quarter were broadly consistent with our plans, and included sequential improvement in our volume and gross margin trends from the fourth quarter of 2012,” General Mills CEO Ken Powell said in a statement.
Shares of General Mills opened up more than 1% to $39.80 on Tuesday.
While first-quarter sales slipped 1% in the U.S. to $2.49 billion, General Mills' international segment jumped 27% to $1.09 billion, led primarily by acquisitions, including its 2011 purchase of a 51% stake in Yoplait International for $1.2 billion.
Looking ahead, Powell said the company is seeing “slow improvement” in price and volume trends across its retail food categories in its key U.S. market. The maker of Cheerios, Toaster Strudel and Pizza Rolls said it will ramp up advertising for its new items.
The company reaffirmed its fiscal 2013 earnings outlook of $2.65, excluding special items, which is a penny below the consensus of $2.66.