General Mills Rises on Q1 Results

General Mills

released its fiscal first-quarter earnings results prior to the opening bell on Wednesday. The stock has been rising during the trading session and was last up a little better than two percent to $40.00. The company reported better than expected earnings per share results, but missed Wall Street consensus revenue estimates. The company also delivered some cautious commentary on the U.S. market, although it backed its fiscal 2013 forecast. Chairman and CEO Ken Powell said, "Results for the first quarter were broadly consistent with our plans, and included sequential improvement in our volume and gross margin trends from the fourth quarter of 2012." General Mills reported adjusted net earnings of $0.66 per share, versus $0.64 in the year ago period. This exceeded analysts' consensus EPS estimates of $0.63. Net sales in the period were up 5.3 percent to $4.05 billion from $3.85 billion last year. This missed Street consensus revenue estimates of $4.08 billion. The U.S. retail segment saw sales fall one percent to $2.49 billion, but international sales were up 27 percent to $1.09 billion. Quarterly gross margins were up 260 basis points to 40.2 percent and operating margins rose 270 basis points to 19.3 percent. In backing its fiscal 2013 outlook, General Mills noted that it is seeing slow price and volume improvement across its U.S. core market retail food operations. For fiscal 2013, General Mills expects adjusted earnings per share of $2.65. This is a penny below current analysts' estimates of $2.66.