General Mills reported results for the third quarter of fiscal 2015 ended February 22, 2015. Net sales totaled $4.35 billion, down 1 percent from last year's third-quarter results due to foreign currency effects.
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On a constant-currency basis, quarterly net sales grew 3 percent. Segment operating profit totaled $698 million, up 1 percent. In constant currency, segment operating profit rose 3 percent.
Diluted earnings per share (EPS) totaled 56 cents compared to 64 cents a year ago.
Adjusted diluted EPS, which excludes certain items affecting comparability of results, totaled 70 cents in the third quarter of 2015, up 13 percent from 62 cents in last year's third quarter. On a constant-currency basis, adjusted diluted EPS grew 15 percent.
Constant-currency net sales, total and constant-currency segment operating profit, adjusted diluted EPS and adjusted diluted EPS growth rate in constant currency are each non-GAAP measures. Please see Note 9 to the Consolidated Financial Statements below for reconciliation of these measures to the relevant GAAP measures.
General Mills chairman and chief executive officer Ken Powell said, "Our third-quarter results reflect strengthened operating performance. Our U.S. Retail segment posted net sales and profit growth including contributions from the Annie's business acquired in October 2014.
"Constant-currency net sales and profit growth accelerated for our International segment. And the Convenience Stores and Foodservice segment led our operating results, with sales up 6 percent and profit up 11 percent."
Third-quarter net sales of $4.35 billion were 1 percent below year-ago results, as foreign currency exchange reduced net sales growth by 4 percentage points. On a constant-currency basis, net sales grew 3 percent, including 1 point of growth contributed by the Annie's acquisition.
Pound volume was 1 percent below year-ago levels. Net price realization and mix added 4 points of net sales growth. Gross margin was below year-ago levels, primarily reflecting negative product mix and restructuring charges. Selling, general and administrative expenses declined, driven by an 8 percent decrease in advertising and media expense along with cost savings from restructuring actions.
Segment operating profit rose 1 percent to $698 million. General Mills posted restructuring and project-related charges totaling $74 million pretax in the third quarter, including $25 million recorded in cost of sales.
Third-quarter net earnings attributable to General Mills totaled $343 million and diluted EPS totaled 56 cents. Adjusted diluted EPS, which excludes restructuring charges and certain other items affecting comparability, totaled 70 cents, up 13 percent from 62 cents in last year's third quarter. Foreign currency exchange reduced 2015 third-quarter adjusted diluted EPS by approximately 1 cent. ■