General Mills (GIS)

U.S. Retail Net Sales Percentage Change by Division

During the third quarter of fiscal 2008, Snacks net sales grew 16.4 percent driven by continued strong sales for Nature Valley grain snacks, Fiber One bars, and fruit snacks. Baking Products net sales rose 15.8 percent due to significant volume growth. Yoplait recorded net sales growth of 13.5 percent, reflecting net price realization, continued strong performance from Yoplait Light yogurt, and introductory shipments of new products, including Yo-Plus and Fiber One yogurt. Pillsbury net sales increased 8.0 percent, driven by refrigerated dough products and Totino’s pizza rolls. The Meals division recorded a 7.5 percent net sales increase, led by Progresso ready-to-serve soups and Green Giant frozen vegetables. Net sales for Big G cereals grew 3.1 percent, driven mainly by pricing and package size changes on established cereal brands led by Cheerios varieties and the Fiber One brand.

Operating profits for the third quarter of fiscal 2008 increased 8.8 percent to $486.2 million from $447.0 million in the same period a year ago. Volume growth increased operating profit by $45.1 million. Increased supply chain costs of $33.4 million and an 11.4 percent increase in consumer marketing expenses were offset by favorable net price realization and product mix.

Operating profits for the nine-month period ended February 24, 2008, improved 3.6 percent to $1,543.3 million from $1,489.9 million in the same period a year ago. Volume growth increased operating profit by $50.5 million. Increased supply chain costs of $129.3 million, and a 9.2 percent increase in consumer marketing expenses were more than offset by favorable net price realization and product mix. Voluntary product recalls reduced operating profits by $21.9 million.

International Segment Results

Net sales for our International segment were up 20.2 percent in the third quarter of fiscal 2008 to $612.8 million. This growth was driven by a 4.4 point increase in sales volume, 10.3 points of favorable foreign exchange, and 5.5 points of net price realization and product mix. Net sales were up 20.4 percent in the nine-month period ended February 24, 2008, to $1,877.9 million. This growth was driven by a 7.0 point increase in sales volume, 8.8 points of favorable foreign exchange, and 4.6 points of net price realization and product mix. Net sales increased across all of our geographic regions.

U.S. Retail Net Sales Percentage Change by Division

During the second quarter of fiscal 2008, Snacks net sales grew 12.0 percent driven by continued strong sales for Nature Valley grain snacks, Fiber One bars, and fruit snacks. Yoplait recorded net sales growth of 11.3 percent, reflecting net price realization, continued strong performance from Yoplait Light yogurt, and new products, including Yo-Plus yogurt. Net sales for Big G cereals grew 2.7 percent, driven mainly by pricing and package size changes on established cereal brands. The Meals division recorded a 0.9 percent net sales increase, led by Progresso ready-to-serve soups that offset slight declines in our dry dinners category. Pillsbury net sales declined 1.8 percent, as the impact of the voluntary frozen pizza recall more than offset growth in other categories within this division.

Operating profits for the second quarter of fiscal 2008, declined 2.0 percent to $583.8 million from $595.6 million in the same period a year ago. Volume declines decreased operating profit by $21.9 million. Increased supply chain costs of $65.1 million, excluding the effect of the frozen pizza recall, and a 7.1 percent increase in consumer marketing expenses were offset by favorable price and product mix. In addition, the voluntary frozen pizza recall reduced operating profits by $19.9 million.

Operating profits for the six-month period ended November 25, 2007, improved 1.4 percent to $1,057.1 million from $1,042.9 million in the same period a year ago. Volume growth increased operating profit by $5.7 million. Increased supply chain costs of $96.6 million, excluding the effect of the frozen pizza recall, and an 8.1 percent increase in consumer marketing expenses were more than offset by favorable price and product mix. In addition, the voluntary frozen pizza recall reduced operating profits by $19.9 million.

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International Segment Results

Net sales for our International segment were up 22.2 percent in the second quarter of fiscal 2008 to $665.7 million. This growth was driven by an 8.1 point increase in sales volume, 9.0 points of favorable foreign exchange, and 5.1 points of net price realization and product mix. Net sales were up 20.5 percent in the six-month period ended November 25, 2007 to $1,265.1 million. This growth was driven by an 8.4 point increase in sales volume, 8.1 points of favorable foreign exchange, and 4.0 points of net price realization and product mix. Sales volumes increased across all of our geographic regions, especially in Europe and Latin America.

U.S. Retail Net Sales Percentage Change by Division

Big G cereals recorded a 5.3 percent net sales increase reflecting introductory shipments of new products, improved levels of non-promoted sales, and the effect of pricing and package size changes on established cereal brands. The Meals division recorded a 6.2 percent net sales increase, led by Progresso ready-to-serve soups and dry dinners. Pillsbury net sales grew by 5.9 percent, led by strength in Totino’s pizza and hot snacks and Toaster Strudel. Snacks division net sales grew 16.0 percent led by strong performance in Nature Valley and Fiber One grain snacks and Betty Crocker fruit snacks, offset by declines in the salty snacks and popcorn categories. Yoplait recorded net sales growth of 3.4 percent led by the Light varieties and multipack segments of the core cup product line, as well as pricing actions taken during the quarter.

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Operating profits for the first quarter of fiscal 2008, improved 5.8 percent to $473.3 million from $447.3 million in the same period a year ago. Volume growth increased operating profit by $27.6 million. Increased supply chain costs of $31.5 million and consumer marketing expenses of $19.1 million were offset by favorable price and product mix.

International Segment Results

Net sales for our International segment were up 18.5 percent in the first quarter of fiscal 2008 to $599.4 million. This growth was driven by an 8.7 point increase in sales volume, 7.0 points of favorable foreign exchange, and 2.8 points of price and product mix. Sales volumes increased across all of our geographic regions, especially in Europe and Latin America.