General Mills Sees Weaker Quarterly Earnings as Costs Rise
General Mills reported higher-than-expected quarterly earnings on Wednesday, but lifted its full-year forecast only slightly, citing higher costs.
General Mills shares were lower in pre-market trading after the announcement. (Click here to track the company's shares before the opening bell.)
The maker of Cheerios cereal and Progresso soups said it expected earnings in the current fourth quarter to be lower than a year earlier, hurt by increased spending for in-store merchandising.
The company also expects a 3 percent rise in costs for fuel and ingredients such as grain.
For fiscal 2013, which will end in May, General Mills forecast earnings of $2.66 to $2.68 a share, a penny higher than its prior range of $2.65 to $2.67.
In the third quarter ended on Feb. 24, net income was $398.4 million, or 60 cents per share, up from $391.5 million, or 58 cents per share, a year earlier.
Excluding one-time items, earnings were 64 cents per share. On that basis, analysts on average were expecting 57 cents on $4.36 billion in revenue, according to Thomson Reuters I/B/E/S.
Net sales rose 7.5 percent to $4.43 billion.
For fiscal 2014, the company expects high single-digit earnings growth, which it said was in line with its long-term model.