General Mills 1Q Profit Rises, Revenue Misses

Reuters

General Mills, the maker of Cheerios cereal and Yoplait yogurt, reported a better-than-expected quarterly net profit as U.S. sales showed further recovery.

The company's shares rose 1.7 percent to $57.77 in premarket trading on Tuesday.

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General Mills' U.S. sales rose 3.6 percent to $2.53 billion in the first quarter ended Aug. 30, accounting for more than 60 percent of total revenue.

The company's sales in the United States have been under pressure as consumers change their eating habits, shifting away from some of the main products it sells, such as meals and cereals.

Sales in the latest reported quarter were helped partly by the acquisition of organic food producer Annie's. The deal boosted General Mills's organic food business, which includes Cascadian Farm and healthy snacks makers Food Should Taste Good.

Net earnings attributable to the company rose to $426.6 million, or 69 cents per share, from $345.2 million, or 55 cents per share, a year earlier.

Excluding items, the company earned 79 cents per share, well above average analyst estimate of 69 cents, according to Thomson Reuters I/B/E/S.

Net sales fell 1.4 percent to $4.21 billion, hurt by a strong U.S. dollar.

Analysts were expecting the Minneapolis, Minnesota-based company to post revenue of $4.75 billion, according to Thomson Reuters I/B/E/S.

(Reporting by Amrutha Penumudi in Bengaluru; Editing by Saumyadeb Chakrabarty)