General Mills' Stock Falls After Profit And Sales Miss Expectations

By Tomi KilgoreMarketsMarketWatch Pulse

General Mills Inc.'s stock shed 3.3% in premarket trade Tuesday, after the consumer foods company missed profit and sales expectations. Earnings for the quarter to Nov. 27 fell to $481.8 million, or 80 cents a share, from $529.5 million, or 87 cents a share, in the same period a year ago. Excluding non-recurring items, adjusted earnings per share was 85 cents, below the FactSet consensus of 86 cents. Revenue fell 7% to $4.11 billion, missing the FactSet consensus of $4.22 billion, with its U.S. retail and convenience stores and foodservice sales falling short of expectations. For fiscal 2017, the company cut its sales guidance to a decline of 3% to 4% from a previous outlook of flat to down 2%, but its adjusted EPS growth outlook of 6% to 8% was above the growth implied by the FactSet consensus of 5.1%. "Our organic sales declines reflect the actions we've taken to optimize our spending and prioritize profitable volume, as well as weakening food-industry trends in the U.S.," said Chief Executive Ken Powell. The stock has climbed 9.4% year to date through Monday, while the S&P 500 has gained 10.7%.

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