General Mills Reaffirms Guidance For Fiscal 2018

MINNEAPOLIS, Nov. 14, 2017 /PRNewswire/ -- In conjunction with discussions today at the Morgan Stanley Global Consumer & Retail Conference, General Mills (NYSE: GIS) reaffirmed its key financial targets for the fiscal year ending May 27, 2018.  Organic net sales are expected to decline between 1 and 2 percent from 2017 levels.  Total segment operating profit in constant currency is expected to range between flat and up 1 percent, and adjusted operating profit margin is expected to increase over year-ago levels.  Fiscal 2018 adjusted diluted earnings per share (EPS), which excludes certain items affecting comparability, are expected to increase between 1 and 2 percent in constant currency.

The company also commented on its expectations for fiscal 2018 second quarter results, including significant improvement in organic net sales trends compared to first-quarter results, driven largely by continued improvement in retail sales trends in U.S. measured outlets.  Second-quarter adjusted gross margin and adjusted operating profit margin are expected to be below last year.  Constant-currency segment operating profit and adjusted diluted EPS are also expected to be below year-ago levels in the second quarter, though the rate of decline is expected to be less than in the first quarter of 2018. 

"We feel good about the progress we are making across many of our key products and geographies," said Jeff Harmening, General Mills chief executive officer.  "We also feel good about the year, particularly the improvement we'll deliver on the topline, but we are not satisfied.  My team knows we still have much to do to get back to delivering the type of results our investors expect from General Mills over the long term, and we are moving in the right direction." 

A webcast of today's General Mills discussion can be accessed live at www.generalmills.com/investors beginning at 3:00 PM Eastern Time. The webcast will be available through May 13, 2018.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on our current expectations and assumptions. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from the potential results discussed in the forward-looking statements. In particular, our predictions about future net sales and earnings could be affected by a variety of factors, including: competitive dynamics in the consumer foods industry and the markets for our products, including new product Introductions, advertising activities, pricing actions, and promotional activities of our competitors; economic conditions, including changes in inflation rates, interest rates, tax rates, or the availability of capital; product development and innovation; consumer acceptance of new products and product improvements; consumer reaction to pricing actions and changes in promotion levels; acquisitions or dispositions of businesses or assets; changes in capital structure; changes in the legal and regulatory environment, including labeling and advertising regulations and litigation; impairments in the carrying value of goodwill, other intangible assets, or other long-lived assets, or changes in the useful lives of other intangible assets; changes in accounting standards and the impact of significant accounting estimates; product quality and safety issues, including recalls and product liability; changes in consumer demand for our products; effectiveness of advertising, marketing, and promotional programs; changes in consumer behavior, trends, and preferences, including weight loss trends; consumer perception of health-related issues, including obesity; consolidation in the retail environment; changes in purchasing and inventory levels of significant customers; fluctuations in the cost and availability of supply chain resources, including raw materials, packaging, and energy; disruptions or inefficiencies in the supply chain; effectiveness of restructuring and cost savings intuitive; volatile it in the market value of derivatives used to manage price risk for certain commodities; benefit plan expenses due to changes in plan asset values and discount rates used to determine plan liabilities; failure or breach of our information technology systems; foreign economic conditions, including currency rate fluctuations; and political unrest in foreign markets and economic uncertainty due to terrorism or war.  The company undertakes no obligation to publicly revise any forward-looking statement to reflect any future events or circumstances.

Our fiscal 2018 outlook for organic net sales growth, constant-currency total segment operating profit and adjusted diluted EPS growth, and adjusted operating profit margin are non-GAAP financial measures that exclude, or have otherwise been adjusted for, items impacting comparability, including the effect of foreign currency exchange rate fluctuations, restructuring charges and project-related costs, and commodity mark-to-market effects. Our fiscal 2018 outlook for organic net sales growth also excludes the effect of acquisitions and divestiture.  We are not able to reconcile these forward-looking non-GAAP financial measures to their most directly comparable forward-looking GAAP financial measures without unreasonable efforts because we are unable to predict with a reasonable degree of certainty the actual impact of changes in foreign currency exchange rates and commodity prices or the timing of acquisitions, divestitures and restructuring actions throughout fiscal 2018.  The unavailable information could have a significant impact on our fiscal 2018 GAAP financial results.

For fiscal 2018, we currently expect: foreign currency exchange rates (based on blend of forward and forecasted rates and hedge positions), acquisitions, and divestitures to have an immaterial impact on net sales growth; foreign currency exchange rates to have an immaterial impact on total segment operating profit and adjusted diluted EPS growth; and total restructuring charges and project-related costs related to actions previously announced to total approximately $42 million.

About General Mills
General Mills is a leading global food company that serves the world by making food people love. Its brands include Cheerios, Annie's, Yoplait, Nature Valley, Fiber One, Häagen-Dazs, Betty Crocker, Pillsbury, Old El Paso, Wanchai Ferry, Yoki, and more. Headquartered in Minneapolis, Minnesota, USA, General Mills generated fiscal 2017 consolidated net sales of US $15.6 billion, as well as another US $1.0 billion from its proportionate share of joint-venture net sales.

SOURCE General Mills, Inc.

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