Tuesday reported flat third-quarter earnings, despite higher commodity prices, missing analysts' estimates.
The Minneapolis-based food company had net income of $242 million, or 63 cents a share, on revenue of $2.70 billion, vs. $240 million, or 63 cents a share, on sales of $2.64 billion a year ago. The consensus estimate was for 66 cents a share, according to Thomson One Analytics.
The quarterly results include costs related to the company's 2002 acquisition of rival Pillsbury. Without that, the company earned 64 cents a share in its fiscal 2004 third quarter ended Feb. 22, compared to 67 cents a share in the year-ago period.
"Our third-quarter results were disappointing, and reflect the impact of higher supply chain costs and soft unit volumes," the company said in a statement. "We are introducing a number of new products, some of which address consumers' current interest in lower carbohydrate choices. These new product introductions will be supported with increased levels of marketing spending in the fourth quarter."
General Mills offered a revised forecast for full-year 2004 EPS of $2.75, including an estimated 10 cents a share worth of restructuring, merger and other related costs. The consensus forecast for the fiscal year ending in May is for $2.84 a share.
During the third-quarter, sales fell 1% at the company's retail unit and 6% at its bakery and food services group. International sales rose 20%, partly because of the weaker dollar.
Shares fell 35 cents, or 0.8%, to $46.35 in premarket trading.