Sep 19, 2012 • By

First-quarter earnings for fiscal 2013

Today General Mills announced earnings for our fiscal 2013 first quarter.

General Mills Chairman and CEO Ken Powell told investors our first-quarter performance was broadly in line with our expectations.

“Across our U.S. retail categories, we’re seeing pricing moderate and volume improve as we begin to lap last year’s significant price increases,” said Ken. “We’re seeing improving trends for our business, as well.”

“Our confidence reflects that fact that our categories are on-trend with consumer demand for great-tasting, healthy and convenient foods, all at a good value,” he added. “Our categories are growing because they’re on trend.”

Jon Nudi, president of our snacks division, gave investors an update on one of these growing categories: our snacks business.

Jon said U.S. consumers are snacking more than ever. “Consumers have changed what they grab for a quick refuel. Instead of mindless munching, consumers are increasingly looking for options that provide real nutritional benefits,” he said.

Grain bars is our largest and fastest-growing business. General Mills created this category back in 1975 with the launch of Nature Valley granola bars. Today Nature Valley granola bars are marketed in 80 countries.

In 2006 we launched the Fiber One snack bar line, and have seen tremendous growth on that brand. In fiscal 2012, we further expanded the Fiber One line with the introduction of 90-calorie brownies.

In one year, just two brownie flavors generated more than $100 million in retail sales. To put that in context, Jon said the industry benchmark sets a standard of $15 million for a successful new product introduction. We’re also currently launching a 90-calorie chocolate chip cookie that is off to a terrific start.

But when it comes to grain snacks, Nature Valley continues to be our flagship brand.

Our newest variety is Nature Valley Protein bars, which contain 10 grams of protein in each bar. They contributed to double-digit retail sales growth for the brand in fiscal 2012, and according to Jon, they’re on track to be as big as Fiber One brownies in year-one retail sales.

Here are some other highlights from our first-quarter report:

•Diluted earnings per share (EPS) totaled 82 cents, including a net benefit from a discrete tax item and higher mark-to-market valuation of certain commodity positions.

•First-quarter fiscal 2013 adjusted diluted EPS, which excludes certain items affecting comparability, totaled 66 cents, compared to 64 cents in last year’s first quarter. This compares to the consensus of analyst estimates of 62 cents.

•Net sales grew 5 percent to $4.05 billion, reflecting contributions from acquired businesses.

•Segment operating profit grew 6 percent to $769 million.

•General Mills launched more than 100 new products worldwide in the first quarter.

•The company reaffirmed its full-year fiscal 2013 EPS guidance.

For further details on our first-quarter results, you can access our investor webcast on