General Mills raises outlook after “strong” first half

General Mills has raised its full-year outlook, after reporting a 4% jump in Q2 sales and operating profit that “essentially matched” year-ago levels.

The company’s net sales rose to $5.22 billion in the quarter, compared with analysts’ estimates of $5.19 billion, according to Refinitiv data, cited by Reuters.

Following its “strong” first-half performance, the Cheerios cereal maker raised its full-year forecast for organic net sales growth, saying that it now expects a rise of between 8% and 9% in fiscal 2023, compared with its previous forecast of a 6% to 7% increase.

General Mills’ biggest unit – North American retail – recorded an 11% net sales increase to $3.37 billion, driven by favourable net price realisation and mix, partially offset by lower pound volume and the impact of the sale of Helper and Suddenly Salad.

Second-quarter net sales for the International segment were down 27% to $671.7 million, reflecting in part the impact of yogurt and dough divestitures and a Haagen Dazs ice cream recall. Meanwhile, organic net sales were up 5%, with growth in Brazil, Europe and Australia partially offset by the impact of the ice cream recall and a decline in China due to continued consumer mobility restrictions. Segment operating profit totalled $18 million, compared with $59 million in Q2 2021, reflecting higher input costs and lower volume.

“We continued to execute well and delivered strong top- and bottom-line growth in the second quarter,” said General Mills chairman and CEO, Jeff Harmening.

“Amid ongoing volatility in the operating environment, we remain focused on driving our ‘Accelerate’ strategy by investing in brand building and innovation, strengthening our capabilities and continuing to reshape our portfolio.”

He added: “With strong first-half results and positive momentum on our business, we are increasing our full-year outlook for organic net sales, adjusted operating profit and adjusted diluted EPS growth”.