General Mills to Exit Certain Products

MINNEAPOLIS, MN. (TheStreet) -- General Mills(GIS) has decided to exit some of its underperforming products in the U.S. retail market.

In a notice filed with the SEC today, General Mills explained that it would use the resulting additional capacity at its U.S. retail division to sell profit-making products.

Without specifying what the products are, General Mills says that it generated $35 million in revenue in fiscal 2009. The decision comes with a $24.1 million non-cash restructuring, impairment and other exit charge against the related assets in the second quarter of fiscal 2010 ending November 29, 2009. General Mills says the decision has not resulted in any workforce reductions.

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General Mills warns that an additional $2.5 million of other exit costs related to its decision could be recorded in its books at a later time and that the actions associated with the decision will be completed by the end of second quarter fiscal 2011.

General Mills says the this charge is consistent with its 2010 full-year earnings guidance and that its second quarter 2010 earnings per share will be at least in line with the Thomson Reuters average consensus estimate of $1.43.

General Mills shares have inched up 0.2% at $68.50 in midday trading. The company owns brand such as Cheerios, Chex, Pillsbury and Betty Crocker. Kellogg(K) shares are unchanged at $53.87. Another competitor, Ralcorp(RAH), has notched up 0.5% to $57.69 per share.

-- Reported by Andrea Tse in New York

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