General Mills Shares Gain On Higher Q4 Adj. Earnings, Sales Growth; $3 Bln Cost Savings Target

(RTTNews) - Shares of General Mills, Inc. were gaining around 7 percent in the early morning trading on the NYSE, after the branded food major reported Wednesday higher fourth-quarter adjusted earnings and net sales, and announced a $3 billion cost savings plan by fiscal 2030.

Meanwhile, including one-time costs, the company slipped to a hefty loss in the quarter, and warned on weak adjusted earnings in fiscal 2027. General Mills added that its top priority is to restore profitable organic net sales growth over the long term.

Chairman and Chief Executive Officer Jeff Harmening stated, "With our price investment work behind us, our focus in fiscal 2027 is to improve our topline growth by driving a step change in the remarkability of our brands. … At the same time, we are laser focused on increasing our efficiency to help offset elevated inflation, fund our growth investments, and generate stronger earnings and cash flow."

Looking ahead for fiscal 2027, General Mills expects adjusted earnings to be between $3.00 and $3.20 per share, compared to $3.55 last year, and adjusted operating profit to be down 13 percent to down 8 percent in constant currency.

Organic net sales are expected to range between down 1.5 percent and up 0.5 percent.

The company said its top priority is to restore profitable organic net sales growth over the long term by improving the remarkability of its brands.

Further, the firm said it is targeting $3 billion in cumulative cost savings by fiscal 2030, primarily through Holistic Margin Management productivity program and global transformation initiative. In this, at least $750 million is expected to be delivered in fiscal 2027.

In the fourth quarter, net loss attributable to General Mills totaled $2.01 billion or loss per share of $3.74, compared to net earnings of $294.0 million or $0.53 per share last year.

The latest quarter was mainly hit by goodwill and other intangible assets impairments of $3.15 per share and Valuation loss on held for sale business of $1.45 per share.

Adjusted earnings per share were $0.95, compared to $0.74 a year ago.

Net sales were up 1 percent to $4.61 billion from $4.56 billion a year ago, including a 7-point benefit from the 53rd week. Organic net sales were flat, including a 1-point benefit from favorable trade expense timing.

In addition, the board of directors declared a quarterly dividend at the prevailing rate of $0.61 per share, payable August 3, to shareholders of record July 10.

On the NYSE, the shares were trading at $37.16, up 6.74 percent.